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Committee hears bill to exclude limited interest income from taxable income; opponents cite return complexity
Summary
Rep. Terry Falk told the House Taxation Committee House Bill 132 would let filers exclude interest shown on 1099‑INT up to a capped amount to encourage savings; Department of Revenue staff said interest is ordinary income and opponents warned the bill risks rolling back return simplification gains.
Representative Terry Falk opened the hearing on House Bill 132, saying the bill “is meant to exempt a portion of people's interest on savings accounts and interest earnings from their individual tax.”
Sponsor’s intent: Representative Falk told the committee the bill would let individuals deduct a portion of interest income reported on Form 1099‑INT from adjusted gross income, with a per‑individual cap (the sponsor described a $2,500 cap per individual) and a doubled cap for joint filers. Falk said the aim was to help smaller savers, young people and…
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