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Senate committee clears a string of tax and finance bills including 529 rollover, ABLE updates and lease-tax changes
Summary
The Senate Revenue & Tax Committee advanced a set of bills covering 529-to-Roth rollovers, ABLE accounts, teacher deductions, aircraft sales/use tax clarifications, motor-vehicle lease tax caps and procedural rulemaking for complex assessments; all measures passed on voice votes.
The Senate Revenue & Tax Committee voted to advance several bills addressing tax administration, education savings accounts and other financial matters. Committee members moved through a supplemental slate of measures; all were approved on voice votes with individual sponsors answering brief questions.
Key measures the committee passed included:
- House Bill 1085 (Representative Carolyn Brown): Conforms Arkansas' 529 plan rules (the Arkansas Brighter Future Plan) with recent federal guidance so account owners may roll unused 529 funds into a Roth IRA for a named beneficiary, subject to annual limits and a lifetime rollover cap of $35,000. Representative Brown told the committee the state’s 529 assets under management are roughly $1,000,431,429 and estimated the fiscal impact of the bill at about $190,000 related to gains on nonqualified withdrawals.
- House Bill 1063 (Senator Kroll, District 3): Updates state treatment of ABLE accounts to align with federal changes and protect beneficiaries' access to savings without risking benefits; sponsors estimated about a $20,000 fiscal effect.
- House Bill 1732 (Representative listed as DanBot, District 87): Increases the teacher out-of-pocket classroom expenses deduction from $500 to $1,000. Sponsor testimony emphasized teachers’ outlays for supplies and classroom needs.
- House Bill 1807 (Representative Lesseves, District 58): Clarifies the sales/use tax treatment for sellers and lessors of aircraft, codifying a minimum lease rate of 7.5% of acquisition cost for industry-standard lease calculations and aiming to prevent double taxation. Sponsor said the change could make Arkansas more competitive for basing aircraft.
- House Bill 1960 (sponsor Matt Stone, State Senate District 2): Changes the way sales tax on motor-vehicle leases is collected, capping the taxable lease stream at $2,500 for local sales and use tax purposes and specifying the lessee as the owner for property-tax reporting; Department of Finance and Administration (DFA) staff said no state revenue impact was expected but local collections on leases would be affected.
- House Bill 1894 (presented by Senator Petty for Senator Gilmore): Directs the Arkansas County/Commerce department (ACD) to adopt rules and guidelines for a complex real-estate assessment process; Association of Counties testified they had worked with sponsors and supported the final draft.
Committee action on each item was followed by a motion to pass and a voice vote. Sponsors and agency staff provided brief explanations of fiscal impacts, administrative mechanics and enforcement. No roll-call tallies were read into the record in the transcript for these measures.
