CHARLESTON, W.Va. — The state of West Virginia is on track to return up to $375 million to state taxpayers over the next several weeks in connection with last year’s personal income tax decrease.
State Deputy Revenue Secretary Mark Muchow told lawmakers Monday the amount will end up being about $150 million more than refunds totaled in last year’s tax filing season. Muchow said it’s all connected to the 21% reduction in personal income taxes approved by lawmakers last year and signed into law by Gov. Jim Justice.
The tax cut was retroactive so taxpayers paid under the old rate for the first few months of 2023.
“We’re projecting somewhere between $365 million and $375 million in refunds during the normal refund season that are attributable to individual tax returns,” Muchow said.
As of Monday’s tax filing deadline, the state had already returned nearly $236 million to taxpayers. Muchow said the state will be processing returns until about June 30.
Muchow was also asked Monday if the state’s revenue collections were going to reach a point when triggers would kick-in later this year for another personal income tax reduction. Muchow said it was too early to tell.
“I do believe that the income taxes are going to trend lower during the April-May period, it may come up in June, but there’s are too many variables out there to make a firm analysis on the trigger,” Muchow said.
He did predict Monday that the state would end the fiscal year closer to a $800 million revenue collection surplus, which would be significantly more than originally predicted.
“The fact that we are talking about triggers is rather significant because at the beginning of the year we were forecasting a little more than a $600 million surplus for this year and now it’s getting closer to $800 million and that’s telling us we’re doing better than we thought we would several months ago,” Muchow said.
Muchow said the personal property care tax rebate, which was part of the tax cut package passed by lawmakers last year, will show up during next year’s tax season. He said it will likely produce about $200 million in refunds.