August 21, 2023 Connecticut budget includes middle-class income tax cuts effective January 1, 2024 The Connecticut state budget (HB 6941) approved by Governor Ned Lamont on June 12, 2023, includes reductions to the state's personal income rates for middle-class income taxpayers. The rate cuts take effect January 1, 2024. Middle-class income tax cuts Effective January 1, 2024, the first $10,000 ($20,000 for married filing joint) will be taxed at 2%, down from 3%, The next $40,000 ($80,000 for married filing joint) will be taxed at 4.5%, down from 5%. This tax relief is capped for individual taxpayers who earn $150,000 or more and married couples filing joint who earn $300,000 or more. The remaining tax rates are unchanged, with the highest marginal tax rate remaining at 6.99%. Governor Lamont stated that an estimated one million taxpayers will benefit from the reduced personal income tax rates. Connecticut does not allow for a supplemental rate of withholding for bonuses and irregular wage payments. Unmarried taxpayer rate effective January 1, 2024
Married filing joint rate effective January 1, 2024
Ernst & Young LLP insights Employees should consider reviewing their 2024 Form CT-W4, Employee's Withholding Certificate, taking into account the lower tax rates that will apply. ———————————————
Published by NTD’s Tax Technical Knowledge Services group; Andrea Ben-Yosef, legal editor | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||