SB 80 increases the state income tax deduction for contributions to state-run 529 college savings plans. It raises the deduction from $5,000 to $7,500 for individual filers and from $10,000 to $12,500 for married couples filing jointly. The bill directly affects taxpayers who contribute to these state-established tuition savings accounts. This change lowers taxable income for eligible contributors, making college savings slightly more affordable.
HB 5113 exempts Connecticut taxpayers from state income tax on forgiven amounts for student loans, medical debt, and credit card debt. The bill adds a new deduction to Connecticut's tax code, allowing taxpayers to exclude debt relief that would otherwise be taxable under federal law. This directly affects residents who receive debt settlement or relief for these specific debt types. The provision takes effect January 1, 2027, and aligns Connecticut tax treatment with federal rules for these debt forgiveness scenarios.
HB 5052 would allow Connecticut taxpayers to deduct charitable contributions they already reported on their federal income tax returns from their state personal income tax. The deduction applies only to gifts claimed on federal returns, matching the amount reported to the IRS. This would reduce the state tax burden for eligible taxpayers who itemize deductions on their federal returns. The bill does not alter federal deduction rules or create new charitable giving incentives.
SB 189 would remove income limits that currently restrict who can deduct Social Security benefits from their state personal income tax. Currently, taxpayers with higher incomes cannot claim this deduction, but the bill would eliminate those thresholds, making the deduction available to all state residents receiving Social Security benefits regardless of their total income. The bill amends section 12-701 of the state tax code to achieve this change. This policy adjustment directly affects taxpayers who rely on Social Security benefits and file state income tax returns.
HB 5206 establishes a tax credit of up to $2,500 against personal income tax for volunteer firefighters who meet specific service requirements. The credit directly affects volunteer firefighters certified by their fire chief as having completed the required service hours. Key provisions require fire chiefs to verify qualifying service, with the credit applying against the individual's state income tax liability. This policy change provides direct financial relief to eligible volunteer firefighters without altering tax rates or creating new obligations for the state.
HB 5061 would increase Connecticut's property tax credit against personal income tax for primary residences or motor vehicles. It raises the maximum credit from $300 to $1,000 per year, increases the minimum credit threshold, and expands eligibility by raising the income limits for qualifying residents. The bill directly affects Connecticut homeowners and vehicle owners who pay property tax and meet the updated income thresholds. This change would reduce eligible taxpayers' annual income tax bills by up to $1,000.
HB 5010 would amend state tax law to exclude tips or gratuities and overtime pay from taxable personal income. This change directly affects workers who earn these specific income types, such as servers, hospitality staff, and hourly employees receiving overtime. The bill's key provision requires updating the tax code to remove these earnings from the base used to calculate personal income tax. As a result, individuals would pay income tax only on their regular wages, not on declared tips or overtime earnings.
HB 5192 would create a new personal income tax deduction for workers who declare tips or gratuities to the IRS. Specifically, it adds a deduction for the full amount of tips reported by taxpayers in their annual tax filings. This directly affects service industry workers (like servers, bartenders, and hair stylists) who receive tips as part of their income. The policy change would reduce taxable income for these workers by the amount of their declared tips, lowering their overall tax bill.
SB 377 creates a personal income tax deduction in Connecticut for military personnel who receive compensation for serving on funeral honor guard details. It directly affects active-duty and reserve military members who are paid for this duty, allowing them to deduct that specific compensation from their taxable income. The deduction applies to amounts already counted as federal taxable income, reducing Connecticut tax liability for this income. The change takes effect for tax years beginning January 1, 2027.
HB 5089 would exempt overtime wages, tips or gratuities, and Social Security benefits from the state's personal income tax. This directly affects workers who earn overtime pay, receive tips (like in restaurants), or rely on Social Security benefits as part of their income. The bill's key mechanism is amending tax law to remove these specific income sources from taxable personal income. It does not change tax rates for other income types, focusing solely on these exemptions.
