Budget & Taxes

HB 2841 amends Oklahoma's management rules for the Tobacco Settlement Endowment Trust Fund, directly affecting the fund and its Board of Investors. It requires the Board to invest fund assets using "prudent person" standards, diversify investments to minimize risk, and hire investment managers through competitive bidding. The bill mandates that at least 2% of the fund's principal balance or $40 million (whichever is greater) must be spent annually on grant and incentive programs. The changes take effect July 1, 2025.

HB 1198 adds a $1,000 property tax break for Oklahoma homeowners with household income under $30,000 annually. It directly affects low-income primary homeowners (defined as those maintaining a home and providing for household necessities) by exempting $1,000 of their property's assessed value from taxes. Homeowners must apply yearly by March 15 (or within 30 days of a valuation notice) and certify income, which includes most earnings like Social Security but excludes veterans' benefits and pandemic relief payments. Seniors aged 65+ who previously qualified do not need annual applications but must report income exceeding $30,000 to maintain the exemption.

HB 1267 adjusts Oklahoma's individual income tax rates for tax years beginning in 2024. It lowers the top marginal tax rate from 5.50% to 4.75% for most taxpayers (single filers and married couples filing jointly), creating new tax brackets starting at 0.25% for lower income levels. The bill eliminates deductions for federal income taxes when calculating Oklahoma taxable income. These changes affect all Oklahoma residents and nonresidents filing state income tax returns for 2024 and subsequent years, with the top rate reduction contingent on a State Board of Equalization determination.

HB 1258 creates a new defined contribution retirement plan for Oklahoma teachers hired on or after November 1, 2024. Teachers must make a one-time irrevocable election to join this plan, which replaces the existing defined benefit system for them; those who don’t elect it default to the current retirement system. Employees contribute a mandatory minimum of 4.5% of salary, with employers matching 6% (increasing to 7% if employees contribute more), all managed in tax-qualified retirement accounts. The plan prevents accrual of service credits under the old system, and participation is binding for all future service with participating employers.