Session of 1998
                   
SENATE BILL No. 440
         
By Committee on Assessment and Taxation
         
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            9             AN ACT enacting the income tax relief act of 1998; amending K.S.A. 79-
10             32,110, 79-32,119 and 79-32,121 and repealing the existing sections.
11            
12       Be it enacted by the Legislature of the State of Kansas:
13           Section 1. K.S.A. 79-32,110 is hereby amended to read as follows:
14       79-32,110. (a) Resident Individuals. Except as otherwise provided by sub-
15       section (a) of K.S.A. 79-3220, and amendments thereto, a tax is hereby
16       imposed upon the Kansas taxable income of every resident individual,
17       which tax shall be computed in accordance with the following tax sched-
18       ules:
19           (1) Married individuals filing joint returns.
20       If the taxable income is:
 The tax is:
21       Not over $30,000
 3.5% of Kansas taxable income
22       Over $30,000 but not over $60,000
 $1,050 plus 6.25% of excess over $30,000
23       Over $60,000
 $2,925 plus 6.45% of excess over $60,000
24           (2) All other individuals.
25       (A) For tax year 1997:
26       If the taxable income is:
 The tax is:
27       Not over $20,000
 4.1% of Kansas taxable income
28       Over $20,000 but not over $30,000
 $820 plus 7.5% of excess over $20,000
29       Over $30,000
 $1,570 plus 7.75% of excess over $30,000
30       (B) For tax year 1998, and all tax years thereafter:
31       If the taxable income is:
 The tax is:
32       Not over $15,000
 3.5% of Kansas taxable income
33       Over $15,000 but not over $30,000
 $525 plus 6.75% of excess over $15,000
34       Over $30,000
 $1,537.50 plus 7.75% of excess over$30,000
35       (C) For tax year 1999:
36       If the taxable income is:
 The tax is:
37       Not over $15,000
 3.5% of Kansas taxable income
38       Over $15,000 but not over $30,000
 $525 plus 6.25% of excess over *$15,000
39       Over $30,000
 $1,462.50 plus 7.45% of excess over$30,000
40       (D) For tax year 2000, and all tax years thereafter:
41       If the taxable income is:
 The tax is:

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1       Not over $15,000
 3.5% of Kansas taxable income
2       Over $15,000 but not over $30,000
 $525 plus 6.25% of excess over $15,000
3       Over $30,000
 $1,462.50 plus 6.45% of excess over$30,000
  4           (b) Nonresident Individuals. A tax is hereby imposed upon the Kansas
  5       taxable income of every nonresident individual, which tax shall be an
  6       amount equal to the tax computed under subsection (a) as if the nonres-
  7       ident were a resident multiplied by the ratio of modified Kansas source
  8       income to Kansas adjusted gross income.
  9           (c) Corporations. A tax is hereby imposed upon the Kansas taxable
10       income of every corporation doing business within this state or deriving
11       income from sources within this state. Such tax shall consist of a normal
12       tax and a surtax and shall be computed as follows:
13           (1) The normal tax shall be in an amount equal to 4% of the Kansas
14       taxable income of such corporation; and
15           (2) the surtax shall be in an amount equal to 3.35% of the Kansas
16       taxable income of such corporation in excess of $50,000.
17           (d) Fiduciaries. A tax is hereby imposed upon the Kansas taxable
18       income of estates and trusts at the rates provided in paragraph (2) of
19       subsection (a) hereof.
20           Sec. 2. K.S.A. 79-32,119 is hereby amended to read as follows: 79-
21       32,119. The Kansas standard deduction of an individual, including a hus-
22       band and wife who are either both residents or who file a joint return as
23       if both were residents, shall be equal to the sum of the standard deduction
24       amount allowed pursuant to this section, and the additional standard de-
25       duction amount allowed pursuant to this section for each such deduction
26       allowable to such individual or to such husband and wife under the federal
27       internal revenue code as in effect for tax year 1988. For tax year 1998,
28       and all tax years thereafter, the standard deduction amount shall be as
29       follows: Single individual filing status, $3,200; married filing status,
30       $5,600; and head of household filing status, $4,800. For tax year 1998
31       and all tax years thereafter, the additional standard deduction amount
32       shall be as follows: Single individual and head of household filing status,
33       $850; and married filing status, $700. For purposes of the foregoing, the
34       federal standard deduction allowable to a husband and wife filing separate
35       Kansas income tax returns shall be determined on the basis that separate
36       federal returns were filed, and the federal standard deduction of a hus-
37       band and wife filing a joint Kansas income tax return shall be determined
38       on the basis that a joint federal income tax return was filed.
39           Sec. 3. K.S.A. 79-32,121 is hereby amended to read as follows: 79-
40       32,121. (a) An individual shall be allowed a Kansas exemption of $1,950
41       for tax year 1988, and $2,000 for each tax year thereafter $2,100 for tax
42       year 1998, and tax years thereafter for each exemption for which such

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  1       individual is entitled to a deduction for the taxable year for federal income
  2       tax purposes. In addition to the exemptions authorized in the foregoing
  3       provision, an individual filing a federal income tax return under the status
  4       of head of household, as the same is defined by 26 U.S.C. 2(b), shall be
  5       allowed an additional Kansas exemption of $1,950 for tax year 1988, and
  6       $2,000 for each tax year thereafter $2,100 for tax year 1998, and all tax
  7       years thereafter.
  8           (b) For tax year 1987, there shall be allowed as a credit against the
  9       tax liability of a resident individual imposed under the Kansas income tax
10       act who except for the operation of the provisions of K.S.A. 79-32,121
11       resulting from amendments to the federal internal revenue code would
12       have been allowed an additional exemption for blindness or age or both
13       pursuant to such section in tax year 1987, an amount equal to $60 for
14       each such exemption. The total amount of such credits shall not exceed
15       the amount of tax imposed by K.S.A. 79-32,110, and amendments thereto,
16       reduced by the sum of any other credits allowable pursuant to law.
17           New Sec. 4. (a) There shall be allowed as a credit against the tax
18       liability of a resident individual imposed under the Kansas income tax act
19       an amount equal to 10% for tax year 1998, and all tax years thereafter, of
20       the amount of the earned income credit allowed against such taxpayer's
21       federal income tax liability pursuant to section 32 of the federal internal
22       revenue code for the taxable year in which such credit was claimed against
23       the taxpayer's federal income tax liability.
24           (b) If the amount of the credit allowed by subsection (a) exceeds the
25       taxpayer's income tax liability imposed under the Kansas income tax act,
26       such excess amount shall be refunded to the taxpayer.
27           (c) The provisions of this section shall be applicable to all taxable
28       years commencing after December 31, 1997.
29           Sec. 5. K.S.A. 79-32,110, 79-32,119 and 79-32,121 are hereby re-
30       pealed.
31           Sec. 6. This act shall take effect and be in force from and after its
32       publication in the statute book.
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