HB163 Summary

• Increases the optional standard deduction for tax years beginning after December 31, 2021, with new amounts ranging from $2,500 to $8,500 depending on filing status and income level.

• Expands the adjusted gross income threshold at which the maximum standard deduction applies, raising it from $23,000 to $25,500 for married couples filing jointly and other filing statuses.

• Increases the dependent exemption income ranges for tax years beginning after December 31, 2021, raising the lower threshold from $20,000 to $50,000 for the maximum $1,000 dependent exemption.

• Modifies standard deduction phase-out rules to apply the new higher income thresholds while maintaining minimum deduction floors to prevent taxpayers from losing benefits at higher income levels.

• Effective immediately upon passage and approval by the Governor or upon otherwise becoming law.