HB 240: Income tax, state; contributions to Virginia College Savings Plan accounts, report.

Official summary

Abstract published by the legislature (via Open States). Text as published by the legislature; reproduced verbatim.

Income tax; contributions to Virginia College Savings Plan accounts; report. Increases the maximum individual income tax deduction for amounts paid or contributed to a prepaid tuition contract or college savings trust account entered into with the Virginia College Savings Plan from $4,000 to $7,500 in taxable year 2024, $11,000 in taxable year 2025, and $15,000 for taxable year 2026 and thereafter. Such amount shall be adjusted for changes in the Consumer Price Index for All Urban Consumers (C-CPI-U) beginning in taxable year 2024. The deduction is limited to $4,000 for taxpayers with federal adjusted gross income that is greater than $100,000 for an individual or $200,000 for married persons filing a joint return. The bill also creates an individual or corporate deduction, as applicable, of up to $4,000 for the amount a child day center or child day program paid or contributed to a customer's or client's prepaid tuition contract or college savings trust account entered into with the Virginia College Savings Plan. The bill also provides a nonrefundable income tax credit for taxable years 2024 through 2028 for 35 percent of expenses incurred by a business during the taxable year for contributions into a Virginia College Savings Plan account owned by an employee of the business. If the employee receiving the contribution is a qualified employee, as defined in the bill, the bill specifies that the credit shall not exceed $500 annually for each such employee. If the employee receiving the contribution is a qualified employee who is not highly compensated, as defined in the bill, the bill specifies that the credit shall not exceed $1,000 annually for each such employee. The bill provides that the total amount of tax credits available for a calendar year shall not exceed $5 million and that any unused tax credit may be carried over for five years.

Sponsors

Sponsors by party (alphabetical): Democratic 10 · Republican 1

“Support” is shown only as formal sponsorship recorded by the legislature. Roll-call votes are available on the official bill page.

Recent official actions

1. November 18, 2024Left in Finance
2. February 7, 2024Continued to 2025 in Finance (Voice Vote)
3. February 4, 2024Impact statement from TAX (HB240)
4. February 2, 2024Assigned Finance sub: Subcommittee #1
5. January 4, 2024Referred to Committee on Finance
6. January 4, 2024Prefiled and ordered printed; offered 01/10/24 24101386D