NC S712

Creates a state income tax exemption for income earned by firefighters, EMS personnel, 911 call center workers, sworn law enforcement officers, child care workers, public school employees, probation/parole officers, and corrections officers, effective for taxable years beginning January 1, 2025

Establishes a tiered income tax structure with a higher 5.05% rate on income above certain thresholds ($1,000,000 for joint filers, $800,000 for heads of household, $600,000 for single filers, $500,000 for married filing separately)

Appropriates $165 million recurring annually for the 2025-2026 fiscal biennium to the Division of Child Development and Early Education for subsidized child care services for qualifying caregiver workers

Limits child care subsidy eligibility to caregiver workers with household income not exceeding $125,000 who work at least 30 hours per week, with priority given to child care workers

Includes a rate reduction trigger mechanism that could lower tax rates by 0.50% (to a floor of 2.49%) if General Fund revenues exceed specified amounts ranging from $33.042 billion in FY 2025-2026 to $39 billion in FY 2032-2033