2017 KS Tax Law Changes

Senate Bill 30 was passed on June 5, 2017 and vetoed by Governor Brownback on June 6, 2017.  The veto was overridden with a vote of 27-12 in the Senate and 88-31 in the House on the same day.  A summary of some of the provisions of the bill follow.

100% repeal of non wage business income tax exemption effective January 1, 2017.  Reinstatement of the federal loss carry-forward.

For individuals, a three bracket taxing system will be implemented beginning in 2017.  The brackets for 2017 will be: 2.9%, 4.9% and 5.2%.

No penalties or interest will be charged that arise due to these tax rate changes that take effect as of July 1, 2017 as long as the underpayment is paid by April 17, 2018.

In 2018, the low income exclusion threshold will be reduced to $5,000 for married filing joint and $2,500 for filing single.  The three bracket tax rates will be: 3.1%, 5.25% and 5.7%.

In 2018, 50% of medical expenses, mortgage interest and property taxes will be deductible.  The amount increases to 75% in 2019 and 100% in 2020 and future years.

Kansas will allow 12.5% of the federal dependent care tax credit in 2018, 18.75% in 2019 and 25% in 2020 and future years.

The subtraction modification on Schedule S for net gains from certain livestock and Christmas tree sales is repealed in 2017.

The new law extends the sunset date for the STAR Bonds Financing Act to July 1, 2020.  Effective July 1, 2017 there will be a one year moratorium on the approval of new STAR Bond Districts.