18 April 2018 Utah state income tax rates lowered retroactively to January 1, 2018, tax commission to issue revised withholding guide and tables Recently enacted HB 293 reduces the state income tax rate from 5% to 4.95%. The change is effective retroactively to January 1, 2018. The bill also reduces the corporate income tax rate from 5% to 4.95%. The reduction in the tax rate is expected to lower the overall income tax liability by $52.9 million in FY 2019 and $56.3 million in FY 2020. For a personal income tax filer making $60,000 per year, the median tax decrease is $29 in FY 2019 and $35 in FY 2023. According to a Utah Foundation report, the state is set to receive a windfall in income tax revenues as a result of the passage of the federal Tax Cuts and Jobs Act of 2017 (TCJA). The foundation's report goes on to say that the .05% reduction in the personal and corporate income tax rates will decrease the tax windfall, but will not result in a significant tax cut for households. A previous foundation report estimated that in order to roll back the full impact of the $80 million tax windfall from the TCJA, Utah's income tax rates would have needed to be reduced to 4.90%. According to a Utah State Tax Commission representative, a revised Publication 14, Employer Withholding Tax Guide, will soon be issued, containing revised withholding tables. Employers will start using the revised withholding tables as of the date of the revision and will not be required to retroactively adjust withholding. (Email response to inquiry.) For more information on Utah withholding taxes, see the commission's website.
Document ID: 2018-0837 | ||||||||||||||
