Signed by Governor Mary Fallin

Vote Smart's Synopsis:

Vote to pass a bill that establishes tax revenue provisions including but not limited to standard deductions and tax return filing, effective January 1, 2017.

Highlights:

• Specifies that the taxable interest income from any political organization that is not exempt by law to corporations is taxable under adjusted gross income (Sec. 1).

• Requires the amount of net operating loss tax deductions to be equal to the amount of Oklahoma net operating losses (Sec. 1).

• Establishes that taxable income includes income received from real property, tangible and intangible personal property, and capital gains and losses resulting from the sale of an ownership stake in a publicly traded partnership (Sec. 1).

• Requires every resident with a gross income to file a tax return yearly, which must document their taxable income and adjusted gross income (Sec. 2).

• Requires any nonresident with an Oklahoma gross income of at least $1,000 to file an Oklahoma income tax return (Sec. 2).

• Specifies that the gains or losses from a sale of ownership or interest in a business or partnership is considered taxable income (Sec. 1).

• Specifies that the taxable income of Oklahoma insurance companies is the same as the taxable income for federal tax purposes (Sec. 1).

• Specifies that an insurance company’s income from premiums is taxable income (Sec. 1).

• Specifies that net income and loss include income from patent and copyright royalties, purchase discounts, and interest accounts arising from business activities (Sec. 1).

• Specifies that the average value of real estate for property taxes is calculated by averaging the values of a given property at the beginning and end of the tax period (Sec. 1).

• Establishes that any farming-related loss is considered a net operating loss and is tax-deductible up to the amount of $60,000 (Sec. 1).

• Specifies that taxable income of corporations, estates, and trusts must be adjusted for qualifying gains of taxable income in accordance with current Oklahoma Code (Sec. 1).

• Specifies that personal exemptions given to individuals are given in units of $1,000 (Sec. 1).

• Authorizes an exemption of $1,000 for each taxpayer who is blind or has a blind spouse (Sec. 1).

• Authorizes an exemption of $1,000 for each taxpayer who is over the age of 65 or has a spouse over the age of 65 (Sec. 1).

• Specifies that taxpayers may not claim exemptions unless their income is $25,000 if married and filing jointly, $12,500 if married and filing separately, $15,000 for single individuals, or $19,000 for qualifying heads of household (Sec. 1).

• Requires that individuals using standard deductions after January 1, 2017 add the difference necessary to allow a standard deduction of $6,350 for single individuals and married couples who are filing separately or $12,700 for married couples who are filing jointly or widowers with dependent children (Sec. 1).

• Specifies that disabled individuals may deduct the amount necessary to modify their motor vehicles, home, or workplace in order to compensate for their handicap (Sec. 1).

• Authorizes a late filing deadline for certain members of the Armed Forces who cannot file a tax return on time (Sec. 1).

• Specifies that social security benefits are exempt from taxable income (Sec. 1).

• Nonrecurring expenses related to the adoption of a child are tax deductible (Sec. 1).

• Specifies that any scholarship or stipend from participation in the Oklahoma Police Corps program is tax exempt income (Sec. 1).

• Specifies individuals may deduct $10,000 from their gross income for the donation of a human organ for transplant while living, but this deduction may only be claimed once (Sec. 1).

Full Bill Text