On March 7th, 2023, Governor Justice signed a bill, HB 2526, into law, cutting the resident income tax rates by 21.25%. The maximum rate residents pay will be 5.12% for 2023, down from 6.5% previously. Most of us knew this change was coming, and I would have shared the details earlier if preparing taxes and filing extensions didn't get in the way.

What many are not aware of is a PERSONAL (NOT real estate) Property Tax Rebate created by the same law. The rebate/credit was a compromise to provide relief without amending the state constitution (a resolution that failed in the previous election). The credit also keeps property tax local - in your county's hands to fund schools and local services.

The rebate takes effect in 2024 as a credit on that year's income tax return (filed in 2025). In this newsletter, I'll tell readers what they need to know to maximize their savings.

[Note - There is also a new non-vehicle business personal property tax credit which I will discuss in a separate newsletter]

Yep, that's what it's called, and it's a broad rebate of tax paid on a variety of vehicles (including non-motorized trailers) by a wide swath of individuals and organizations. Here are answers to some common questions:

How Much is the Credit? The credit (rebate for those not filing a tax return) equals 100% of the vehicle personal property tax paid during the tax year. That's right, 100%!

To qualify, the tax must be paid by its due date. Late-paid and delinquent taxes do not qualify.

When Does the Credit Become Available? The law takes effect on January 1st, 2024, so tax timely paid in 2024 qualifies for the credit. And here's the kicker - the rebate continues until changed or repealed - 2025 and beyond.

Which Vehicles Qualify? As mentioned earlier, the credit encompasses a variety of personal property residents pay tax on, including ATVs and trailers.

Here's a list of vehicle classes that qualify.

As you can see, this is an extensive selection of qualifying assets (sorry - your RV didn't make the cut). What is especially surprising is that individuals and businesses qualify for the credit!

Who Qualifies for The Credit? Individual taxpayers qualify, So do Partnerships, S-Corporations, LLCs (sole proprietorships), and C-Corporations.

Partnerships and S-Corporation will likely pass the credit on to partners and shareholders who will claim the credit on their personal returns.

Even vehicle leasing companies qualify. But, they must pass the savings on to the lessee of the vehicle as a discount or refund. This may prove an administrative challenge, so stay on top of them to ensure you receive it.

Note: If you have a flow-through business (Partnership or S Corp), make sure your preparer knows about this credit.

How Do I Apply? There will be a line added to your 2024 WV Income Tax Return(s). There will also be a form created that attaches. Additionally, be prepared to send us receipts, as we'll likely have to scan and attach them to your return.

Those who do not have to file returns (primarily due to their income being non-taxable) will also be able to receive the credit through a separate process - likely, mailing a separate form and receipts directly to the state tax department.

If you're in the habit of paying for your entire year's personal property taxes as soon as you receive the bill, make 2023 an exception. Only half of the bill is due in 2023. Make sure you only pay that half. If you pay for the second half before its due date in 2024, you will get it back as a tax credit when you file your 2024 income tax return in 2025. Here's what else you'll get back—ALL OF THE PERSONAL PROPERTY YOU TIMELY PAY IN THE FALL OF 2024!