Senate Bill 337: Tax Relief and Recovery Act

• Reduces North Carolina individual income tax rate from 5.25% to 4.99% of taxable income, effective for taxable years beginning January 1, 2022.

• Increases standard deductions for all filing statuses: married filing jointly increases from $21,500 to $25,500; head of household from $16,125 to $19,125; single from $10,750 to $12,750; married filing separately from $10,750 to $12,750.

• Increases child tax deduction amounts by $500 across all income levels and filing statuses for taxpayers claiming federal child tax credits, effective for taxable years beginning January 1, 2022.

• Modifies corporate franchise tax calculation to require use of a single tax base (the greatest of net worth, appraised property value, or tangible property investment) instead of three separate bases, effective for taxable years beginning January 1, 2023.

• Changes controlled company franchise tax treatment to include the same percentage of the noncorporate limited liability company's single tax base in corporate calculations, effective for taxable years beginning January 1, 2023.