HB 2604
Continuing personal income tax adjustment to gross income of certain retirees receiving pensions from defined pension plans
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- Passed House of Delegates
- Passed Senate
- To Governor
- Became Law
Bill overview
This bill adjusts West Virginia’s personal income tax rules for retirees receiving pensions from defined pension plans. Specifically, it allows retirees who had their pension plan terminated and are receiving a reduced benefit guarantee from a guarantor to subtract the difference between the expected maximum benefit and the actual received from their pension plan from their federal adjusted gross income. The adjustment was originally enacted in 2008 but has expiration dates that are being modified by this bill.
Key provisions
- Allows retirees with terminated defined benefit pension plans to deduct a difference between expected and actual pension benefits from federal adjusted gross income.
- Applies to pension plans covered by a guarantor with a reduced maximum benefit guarantee.
- The adjustment was originally effective January 1, 2008, and was set to expire on January 1, 2015.
- The bill modifies the expiration dates of the adjustment.
- The adjustment is effective for tax years beginning on and after January 1, 2025.
- The adjustment terminates for tax years after December 31, 2026.
- The adjustment is available regardless of the type of tax return form filed.
- The Tax Commissioner can reduce the percentage of the reduction if it exceeds $2 million annually.
Who is affected
- Retirees
- Pension recipients
- Defined benefit pension plan participants
- Financial institutions guaranteeing pension plans
- Taxpayers
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