BREAKING NEWS FROM THE NC SENATE

FROM THE OFFICE OF NC SENATOR NORMAN SANDERSON

Breaking News from the NC Senate
In This Issue Historic Tax Reform Quick Links NC General Assembly Website  Norman's Website Newsletter Sign-Up	At 4:30pm this afternoon, the NC Senate took a final vote on the "Tax Simplification and Reduction Act" (HB 998). This historic tax reform plan will make North Carolina's tax code friendlier for business, jumping the Tar Heel State from 44th to 17th in the Tax Foundation's State Business Tax Climate Index and will keep more money in taxpayer pockets. This legislation is on it's way to Governor McCrory, who has pledged to sign it. Please read more information about the plan below. If you have ideas, questions or concerns, PLEASE contact me via email at Norman.Sanderson@ncleg.net or by phone(919) 733-5706 (Raleigh). Your input is needed on the decisions being made. I appreciate all those who have called with suggestions.    Norman
Tax Reform for North Carolina    In a historic move, the NC Senate this afternoon signed legislation to update the tax code in North Carolina, creating a more business-friendly environment, keeping more money in taxpayer pockets. Our tax code had not been updated since the 1930s, and this tax reform bill makes NC much more competitive with neighboring state for job creation.    We are pleased to report that this tax plan received support from the NC Association of CPAs, Americans for Prosperity, and Civitas Institute. The national nonpartisan group, Americans for Tax Reform, called our plan the most significant one likely to be approved in 2013 among other states.       TAX REFORM HIGHLIGHTS  Personal Income Tax: *Reduces and simplifies the 3-tiered state personal income tax from the current maximum rate of 7.75% and minimum rate of 6% to 5.8% in 2014 and 5.75% in 2015.   *Increases the standard deduction for all taxpayers, applied to the: o   First $15,000 of income for those married filing jointly o   First $12,000 of income for heads of household o   First $7,500 of income for single filers; *Retains the state child tax credit and increases it for families making less than $40,000; *Offers a $20,000 combined maximum deduction for mortgage interest and property taxes; *Makes charitable contributions fully deductible; *Protects all Social Security income from state taxes. Corporate Income Tax: *Reduces the corporate income tax from 6.9% to 6% in 2014 and then to 5% in 2015 - a 29% rate reduction. *If the state meets revenue targets (i.e. if tax revenue grows due to a growing economy), the corporate income tax will drop to 4% in 2016 and 3% in 2017. Other Highlights: *Caps the state gas tax *Eliminates North Carolina's death tax *Preserves the sales tax refund for nonprofits