What Are The Recent Tax Changes?
In the year 2021, the US government has introduced certain amendments in its existing tax laws to put at ease the US citizens in the time of this ongoing Covid 19 crisis. These changes are made keeping in mind the section that is most affected by the pandemic- the middle class.
The new tax laws include tax relaxation, decrement, and some taxes that were earlier present are even waived off.
On January 1, 2021, Arkansas marched into the third phase of a series of tax informs wherein the tax rate has been reduced from 6.5% to 6.2%. There are newer plans that claim these will further drop to as much as 5.9% till 2022.
The net operating loss (NOL) has also increased in 2021. The carryforward period is now 10 years which was 8 years in the year 2020.
Oregon raised the tax on cigarettes from 1.3$ to 3.3$ per pack and also doubled the tax capital on the same from 0.50$ to 1$ per cigar.
In some states, the marginal corporate income tax rate reduced from 12 to 9.8%. In addition to that, the alternative minimum tax (AMT) has also been revoked for this year.
A slight tax reduction was ratified for certain newly registered businesses. These come with relaxations in the year 2021,2022 or 2023 with a three-year suspension of the 800$ ‘first-year tax’ that the new businesses were charged.
New Jersey’s top corporate income tax rate stands at 11.5% now till the fiscal year 2023.
The usage of revenue from the state’s income and personal property taxes is now promoted to be used in other areas of interest. Previously, the revenues generated from these fields could only be used to support children with disabilities.
Starting from this year, a new payroll tax is being imposed in Connecticut to fund the state’s paid family and medical leave program. This new tax demands a rate of 0.5%.
From this year, voter agreement is indispensable before the state creates new government enterprises that aim at earning more than $100 million during the first five years in operation. This was exempted earlier.
A new lodging tax is imposed In Wyoming at a rate of 5% and the local administrations can collect their lodging tax at a maximum rate of 2%.
Utah now imposes an excise tax at a rate of 1.2% for its prepaid wireless telecommunications service.
Marijuana is now legal in most states in the USA. However, retain sails are not to begin any time before 2022. Once the sales begin, taxation would be 20% of the retail price.
Illinois has been phasing out its franchise tax (capital stock tax). The exemption increased from 30$ to 1000$. Currently, it is a minimal change but the plans are to completely repeal it in or till 2024.
The district’s estate tax dispensation has dropped to $4 million this year. With this decrease, naturally, the rates have also dropped. Earlier this year the rates went from 12% to 16%. In 2021, these rates range from 11.2% to 16%.
In California, the people dealing in used vehicles are now required to collect and repeal the sales tax on their generated sales.