Numerous tax rules are under a microscope in North Carolina, as members of the state Senate deliberated over a bill that would provide certain tax credits and make other financial changes in the state.
Depending on a taxpayer's age, type of business and the amount of laundry he or she does, the measure might make some taxpayers sigh in relief and others pay heftier bills.
House Bill 399 grants income exclusion to match federal guidelines and maintains tax exemptions, historic tax credits and tax fees for certain activities.
The bill passed its second reading in the Senate Wednesday.
The regulations were part of the $24 billion budget proposal vetoed by Gov. Roy Cooper in late July.
Tension over the veto has led to a budget standoff between Democrats and Republicans. Republican lawmakers have filed a series of smaller spending plans to push through parts of the overall budget proposal.
If HB 399 goes into law, the state would revert to a federal provision that it stopped following between 2014 to 2018.
North Carolinians who are 70 and half years old would be able to contribute up to $100,000 from their retirement plans to a charity and then exclude it from their gross income when filing taxes.
Also, companies like Xerox and Carvana that are slated to receive tax incentives for launching new businesses in the state will get another bonus with this bill. It would allow an income tax deduction for the funds received through the economic grants.
Communities with facilities in need of care stand to benefit from the bill also.
It extends the life of historic rehabilitation tax credits up to January 1, 2024, and offers more rehabilitation tax credits to railroad stations in opportunity zones that have historical significance, among other things.
Sales tax exemptions would also continue for professional motorsports racing teams and their members as well as certain airlines to buy fuel through January 1, 2024.
North Carolina is home to the Coca-Cola 600, NASCAR Hall of Fame, racing schools, team shops and motorsports museums. Motorsports teams receive sales tax exemptions for transactions connected with the events including travel expenses.
Also as part of the measure sales tax would continue to be applied to dry cleaning, laundering services and linen rentals. A dry cleaning solvent tax will still be charged for the next 10 years.
There is a 15 percent sales tax on the services and an additional fee on each gallon of dry cleaning solvent sold by a retailer to a dry cleaning facility. The money goes to the Dry Cleaning Solvent Cleanup Fund, which combats dry-cleaning solvent contamination. The state collects about $8 million for the fund each year.
Along with the caravan of tax standards and rules, the bill also has space dedicated to funding the Department of Revenue. It allocates $12.5 million for tax system operations and $4.4 million for fraud and theft investigations.