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Minutes for HB2141 - Committee on Taxation
Short Title
Increasing the Kansas standard deduction for income tax purposes.
Minutes Content for Mon, Feb 8, 2021
Chairperson Smith opened the hearing on HB2141.
Mr. Siebers provided an overview on HB2141 stating the bill would increase the Kansas Standard Deduction for tax year 2021 and thereafter. (Attachment4)
Kathleen Smith, Department of Revenue stated HB2141 would decrease the State General Fund revenues by $47.5 million in FY2022, $36.9 million in FY2023, and $37.2 million in FY2024. The Department indicates the bill would require $17,095 from the State General Fund in FY2022 to implement the bill and to modify the automated tax system.
Proponents:
Representative Gartner, 53rd District testified on HB2141 to increase the standard deductions. He noted SB22 will be coming in the next few weeks that has itemization in the bill at the present time. He pointed out to the Committee members to make a comparison if there is a cut in taxes to look at increasing the standard deduction. About 1% of tax filers below the median income ($21,422) will benefit from itemization. He noted the benefits of itemization will flow to the top 18% of income earners; specifically, between $100,000 and $250,000 annually. The projection is 6.6% additional taxpayers would benefit from itemization. He remarked one of the keys to HB2141 is if we increase the standard deduction everybody gets some benefit. The fiscal note on SB22 for itemization in the out years is about $61 million and what we could do over and above for HB2141 is to raise the married filing jointly to $8,500. (Attachment 5)
Representative Gartner stood for questions from Committee members.
In response to a question, Kathleen Smith stated for tax year 2019 there are around 92% of taxpayers that claim the standard deduction and around 8% that claim itemization deductions.
Written testimony as a proponent to HB2141 was submitted by Ronald and Navella Richey, Topeka residents. (Attachment 6)
Neutral:
Emily Fetsch, Director of Fiscal Policy, Kansas Action for Children provided neutral written testimony for HB2141. (Attachment 7)
Chairperson Smith closed the hearing on HB2141.
