taxnews.ey.comPrint

22 April 2025

Georgia law lowers personal income tax retroactive to January 1, 2025, allows for future tax cuts

On April 15, 2025, Georgia Governor Brian Kemp signed into law H.B. 111, which retroactive to January 1, 2025, lowers the state's income tax rate from 5.29% to 5.19%, accelerating the largest tax cut in Georgia's history. (Governor Kemp press release, 4-15-2025.)

Consistent with existing law, and provided revenue goals are met, H.B. 111 calls for a further reduction in the tax rate of 0.10% annually starting in 2026 until the tax rate reaches 4.99%.

The updated withholding formula, once available, will be posted here.

Background

In 2024, Governor Kemp enacted H.B. 1015, which effective January 1, 2024, lowered the personal income tax rate from 5.49% to 5.39% with additional annual tax cuts of 0.10% starting in 2025 if budget goals are met. (Tax Alert 2024-0841.)

As a result of the automatic rate reductions under H.B. 1015, the personal income tax rate dropped to 5.29% effective January 1, 2025. H.B. 111 accelerated the rate cut to 5.19%.

Ernst & Young LLP insights

Employers should consider notifying employees of the personal income tax changes that apply in 2024 and review the information they have provided on Form G-4, State of Georgia Employee's Withholding Allowance Certificate.

* * * * * * * * * *
Contact Information

For additional information concerning this Alert, please contact:

Workforce Tax Services - Employment Tax Advisory Services

Published by NTD’s Tax Technical Knowledge Services group; Andrea Ben-Yosef, legal editor

Document ID: 2025-0930

 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

Copyright © 1996 – 2025, Ernst & Young LLP

 

All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.

 

EY US Tax News Update Master Agreement | EY Privacy Statement