Amends GS 105-228.90 to update the term Code as it applies to the general administration of taxation to mean the Internal Revenue Code as enacted as of April 1, 2021 (currently, May 1, 2020).
Effective for tax years beginning on or after January 1, 2020, repeals GS 105-153.5(c2)(20) and GS 105-130.5(a)(32), which require an individual or corporate taxpayer to add the amount of any expense deducted under the Code to the extent that payment of the expense results in forgiveness of a covered loan (includes PPP loans) pursuant to section 1106(b) of the federal CARES Act, and the income associated with the forgiveness excluded from gross income pursuant to section 1106(i) of the CARES Act.
Amends GS 105-153.5(a)(2)b. to modify the allowable itemized deduction an individual may elect to deduct from their gross income for mortgage expense and property tax. Prohibits the amount allowed as a deduction for interest paid or accrued during the taxable year under the Code with respect to any qualified residence from including the amount for mortgage insurance premiums treated as qualified residence interest for taxable years 2014 through 2021 (currently limited to taxable years 2014 through 2020).
Further amends GS 105-153.5(c2) to modify the required adjustments to an individual’s gross income, which are decoupled from federal requirements. Requires the taxpayer to add the amounts excluded from the taxpayer’s gross income for the discharge of qualified principal residence indebtedness and qualified tuition and related expenses under the Code for taxable years 2014 through 2025 (currently limited to taxable years 2014 through 2020). Requires the taxpayer to add the amounts excluded from the taxpayer's gross income for payment by an employer of principal or interest on any qualified education loan incurred by the taxpayer for education of the taxpayer for taxable years 2020 through 2025 (currently limited to taxable year 2020), expanding the purpose of the provision to include decoupling from the federal exclusion of payments under the Consolidated Appropriations Act, 2021. Adds a new decoupling provision for taxable years 2021 and 2022 to require a taxpayer to add an amount equal to the amount which the taxpayer's deduction under of the specified section of the Code, regarding business-related expenses for food and beverages provided by a restaurant, exceeds the deduction that would have been allowed under the Code enacted as of May 1, 2020, stating the purpose of the provision is to decouple from the increased federal deduction under the Consolidated Appropriations Act, 2021. Adds a new decoupling provision for taxable years 2021 through 2025 to require a taxpayer to add the amount excluded from the taxpayer's gross income for the discharge of a student loan under the specified section of the Code, stating the purpose of the provision is to decouple from the exclusion from income for the discharge of a student loan under the American Rescue Plan Act of 2021.
Bill H 940 (2021)Summary date: May 12 2021 - View summary