Budget & Taxes (Income Tax)

HB 5133 increases the highest marginal personal income tax rate from 6.99% to 7.99%. This change directly affects high-income earners who currently pay the top tax rate under the state's income tax structure. The bill amends Section 12-700 of the general statutes to implement this specific percentage increase, with no other provisions or mechanisms described in the text. The measure focuses solely on adjusting the tax rate for the highest income bracket.

SB 41 creates a state tax deduction for Connecticut taxpayers aged 65 or older who sell their primary home. It allows these seniors to deduct capital gains (the profit from the sale) that are already counted as taxable income for federal tax purposes. The deduction applies only to gains from selling a primary residence, not rental properties or second homes. This policy directly affects older homeowners by reducing their state income tax bill on the profit from their main residence sale.

HB 5082 increases 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 income threshold for eligibility, and expands access by raising the qualifying Connecticut adjusted gross income limits. This change directly benefits Connecticut residents who own a primary home or vehicle and pay property taxes, reducing their personal income tax liability. The bill modifies existing tax provisions without altering the credit's structure or adding new requirements.

HB 5067 creates a personal income tax deduction for taxpayers with unreimbursed medical expenses exceeding 7.5% of their adjusted gross income. It directly affects individual taxpayers who pay out-of-pocket medical costs not covered by insurance, such as doctor visits, prescriptions, or hospital stays. The bill's key provision allows these taxpayers to subtract the amount of qualifying medical expenses above the 7.5% threshold from their taxable income. This change lowers the taxable income subject to state tax rates, potentially reducing the overall tax liability for eligible filers. The deduction applies only to expenses not reimbursed by insurance or other sources.

SB 66 would create a temporary tax deduction for workers who declare tips or gratuities on their income tax returns. It allows a deduction of up to $25,000 per year for tips earned during 2026-2028, reducing taxable income for affected workers. The deduction phases out for single filers with incomes over $150,000 and married couples filing jointly over $300,000. This policy directly impacts service industry workers who report tip income, lowering their tax burden for the specified period.