An organization representing senior citizens is praising Gov. Jim Justice for signing a bill phasing out state taxes on Social Security benefits.
“We thank the Governor for signing this legislation, and we thank the Legislature for taking action to put more money into the pockets of older West Virginians, much of which will be reinvested in our state’s economy,” said Gaylene Miller, state director for AARP West Virginia.
“For far too long, West Virginia has been an outlier in its tax treatment of Social Security income.”
Miller said the organization’s members and the governor identified elimination of the personal income tax on Social Security as a top legislative priority this past regular session.
“Thousands of older West Virginians engaged with lawmakers through AARP’s grassroots advocacy efforts, and it made all the difference in achieving meaningful tax relief for West Virginia retirees,” Miller said.
The governor signed HB 4880 on Wednesday, the last day he could take action on bills that passed during the session.
The bill was one of the proposals highlighted by the governor during his State of the State address. The Justice administration says 50,000 senior households would be affected.
The phase-out would mean a 35% cut retroactive to Jan. 1, 2024; 65% in 2025 and 100% in 2026. The estimated financial effect of fully eliminating income taxes on Social Security benefits would be a little more than $37 million.
The legislation builds on a 2019 bill signed into law by the governor to exempt Social Security income from personal income taxes for most West Virginians, particularly those in lower tax brackets. That was also a three-year phase-out.
This proposal would exempt those in higher brackets from being taxed on Social Security benefits.
Delegate Paul Espinosa, R-Jefferson, said he supported both the 2019 legislation and the bill that just passed.
“This really completes that exemption for all West Virginians, and I just think it really eliminates a situation where essentially we were double taxing individuals who had retired, who were receiving those Social Security benefits,” Espinosa said.
“West Virginia, as I understand, was one of the few states that still assessed a state tax on those Social Security benefits. So, very happy that we’ll be phasing those out.”