HB 4125
Eliminate double taxation on foreign income at the state level
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Sign in to take action- Introduced
- Passed House of Delegates
- Passed Senate
- To Governor
- Became Law
Bill overview
This bill aims to prevent double taxation of income earned in foreign countries by West Virginia residents. It allows residents to claim a credit against their West Virginia state income tax for income taxes paid to other states or foreign countries. The credit is limited to the percentage of West Virginia income subject to tax and is subject to certain conditions, including demonstrating that without the credit, double taxation would occur under federal tax law. The credit will expire in 2070.
Key provisions
- Allows West Virginia residents to claim a credit against their state income tax for income taxes paid to other states or foreign countries.
- The credit is limited to the percentage of West Virginia income subject to tax.
- Requires taxpayers to demonstrate that double taxation would occur without the credit.
- Excludes credits offered by other jurisdictions that provide similar relief.
- Defines ‘West Virginia income’ to include adjusted gross income, estate/trust income, and electing pass-through entity income.
- The credit sunsets on July 1, 2070.
Who is affected
- West Virginia residents
- Individuals with income from foreign countries
- Pass-through entities operating in West Virginia
Notable changes
- Establishes a state income tax credit for taxes paid to other states or foreign countries.
- Introduces a sunset provision, ending the credit in 2070.
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