Utah taxpayers could see a slight increase in state taxes because of federal tax overhaul

So, what does the Republicans’ federal tax reform mean to your Utah State personal income tax?

Well, if you don’t know (and who does?), let’s listen to Utah State Tax Commissioner John Valentine, a tax lawyer and former Republican state senator.

Valentine addressed the Utah Taxpayers Association annual pre-legislative conference on Monday in the Grand America Hotel.

He gives these examples (remember, these are STATE personal income tax, not federal tax):

An “average Joe” – married with three kids — who has an adjusted federal gross income of $70,000 (the state tax system uses this number to figure state taxes):

  • Paid $2,500 in state personal income tax in 2017.
  • Would pay $2,733 in state tax in 2018.
  • Or about a 10 percent increase of $233 more.

An “average Joe” making $30,000 adjusted federal income:

  • Pays $0 (no) state income tax in 2017.
  • Pays $63 in state income tax in 2018.

For the “above average Joe” who tops out on various tax breaks on his federal adjusted income:

  • Pays the same Utah state tax in 2018 as he pays in 2017.

So there could be some extra money coming in state income tax take for the state – which by law all goes to public and higher education.

On the corporate side, it is very much more complicated.

But overall, the state could actually see a one-time windfall in state corporate income tax take in 2018 over 2017.

What that may be is yet to be seen, says Valentine. But it likely will be one-time extra money, not ongoing.