Connecticut House Bill HB05097

Connecticut 2026 Regular Session

• Introduced: 2/9/26
• Refer: 2/9/26

Caption

An Act Eliminating The Qualifying Income Thresholds For The Personal Income Tax Deductions For Social Security Benefits, Pension Or Annuity Income And Certain Individual Retirement Account Distributions.

Impact

If enacted, HB05097 would substantially alter the tax landscape for retirees and individuals receiving pensions or annuity income in the state. By removing the qualifying income thresholds, the bill would enable a broader range of taxpayers to benefit from deductions on their income derived from Social Security and retirement-related accounts. This adjustment could provide significant financial relief to many households, potentially improving their disposable income and enhancing their quality of life in retirement.

Summary

House Bill 05097 proposes to amend section 12-701 of the general statutes, aiming to eliminate the qualifying income thresholds for personal income tax deductions associated with Social Security benefits, pension or annuity income, and distributions from individual retirement accounts (IRAs). This bill is introduced to alleviate the tax burdens on individuals receiving such benefits, making the income tax structure more equitable for retirees and those reliant on fixed incomes.

Contention

Despite its intended benefits, the bill has drawn some contention. Critics may argue that the removal of income thresholds could disproportionately affect state revenues, as it may result in diminishing tax collections from higher-income individuals. This potential decrease in state revenue raises concerns about the long-term sustainability of funding for essential public services, especially in a state where budgetary constraints are common. As such, discussions around the bill may touch upon the balance between providing tax relief for retirees and maintaining a robust fiscal foundation for state programs.