Payroll

Proposed legislation (House Bill 54), recently signed by the Senate, seeks to reduce the individual income tax rate and modify the earned income tax credit. Effective for a taxable year beginning on or after January 1, 2023, the individual income tax rate would be reduced to 4.65% from 4.85%. Also, the definition of "personal exemption" would be amended to mean $1,750 multiplied by the number of the claimant's qualifying dependents, plus an additional qualifying dependent in the year of a qualifying dependent's birth. The calculation of the nonrefundable earned income tax credit would be modified to be the lesser of 20% (previously, 15%) of the amount of the federal earned income tax credit that a qualifying claimant was entitled to claim on a federal income tax return for the current taxable year; and the total Utah wages reported on the qualifying claimant's W-2 form for the current taxable year [L. 2023, H54].