Senate Bill 477
By: Senators Tillery of the 19th, Walker III of the 20th, Anavitarte of the 31st, Gooch of the
51st, Robertson of the 29th and others
AS PASSED SENATE
A BILL TO BE ENTITLED
AN ACT
To amend Article 2 of Chapter 7 of Title 48 of the Official Code of Georgia Annotated,
relating to the imposition, rate, computation, exemptions, and credits relative to income
taxes, so as to reduce the personal income tax rate; to revise provisions relative to annual
reductions of the income tax; to reduce the rates of taxation on corporate and partnership
income; to increase the amount of the standard deduction from state taxable income for
individuals; to provide for related matters; to provide for an effective date and applicability;
to repeal conflicting laws; and for other purposes.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
SECTION 1.
Article 2 of Chapter 7 of Title 48 of the Official Code of Georgia Annotated, relating to the
imposition, rate, computation, exemptions, and credits relative to income taxes, is amended
by revising subsection (a.1) of Code Section 48-7-20, relating to individual tax rates, credit
for withholding and other payments, and applicability to estates and trusts, as follows:
"(a.1)(1) <del>On and after January 1, 2025, the</del> <ins>The</ins> tax imposed pursuant to subsection (a)
of this Code section shall be <del>5.19 percent for taxable years beginning on or after January
1, 2025; provided, however, that such rate shall be reduced by 0.10 percent annually
beginning on January 1, 2026, until the rate reaches 4.99 percent, provided that such
</del>
<del>annual reductions in the tax rate shall be subject to delays as provided in paragraph (2)
of this subsection</del> <ins>as follows:
(A) For the taxable year beginning on January 1, 2026, 4.99 percent;
(B) For the taxable year beginning on January 1, 2027, 4.49 percent; and
(C) For taxable years beginning on or after January 1, 2028, 3.99 percent,
provided that such annual reductions in the tax rate shall be subject to delays as provided
in paragraph (2) of this subsection.
</ins> (2) Each prospective annual reduction in the tax rate that would otherwise occur as
provided in paragraph (1) of this subsection shall be delayed by one year for each year
that any of the following are true as of December 1:
(A) The Governor's revenue estimate for the succeeding fiscal year is not at least <del>3</del> <ins>1
</ins> percent above the Governor's revenue estimate for the present fiscal year;
(B) The prior fiscal year's net revenue collection was not higher than each of the
preceding three fiscal years' net tax revenue collection; or
(C) The Revenue Shortfall Reserve provided for in Code Section 45-12-93 does not
contain a sum that exceeds the amount of the decrease in state revenue projected to
occur as a result of the prospective reduction in the tax rates set to occur the following
year.
(3) The Office of Planning and Budget shall make the determinations necessary to
implement the provisions of paragraph (2) of this subsection and shall report its
determinations by December 1 of each year to the department, the Speaker of the House
of Representatives, the President of the Senate, and the chairpersons of the House
Appropriations Committee, the House Ways and Means Committee, the Senate
Appropriations Committee, and the Senate Finance Committee. This paragraph shall not
be applicable after the <del>final</del> reduction to the rate of <del>4.99</del> <ins>3.99</ins> percent occurs."
SECTION 2.
Said article is further amended by revising subsection (a) and division (b)(7)(C)(ii) of Code
Section 48-7-21, relating to taxation of corporations, as follows:
"(a) Every domestic corporation and every foreign corporation shall pay annually an
income tax <del>on</del> <ins>equivalent to 4.99 percent of</ins> its Georgia taxable net income <del>at the same rate
of the tax imposed on individuals under subsection (a.1) of Code Section 48-7-20 for the
corresponding taxable year.</del> Georgia taxable net income of a corporation shall be the
corporation's taxable income from property owned or from business done in this state. A
corporation's taxable income from property owned or from business done in this state shall
consist of the corporation's taxable income as defined in the Internal Revenue Code
of 1986, with the adjustments provided for in subsection (b) of this Code section and
allocated and apportioned as provided in Code Section 48-7-31."
"(ii) Notwithstanding the provisions of subparagraph (B) of this paragraph, an
electing Subchapter 'S' corporation, with respect to a taxable period, shall pay an
income tax <del>on</del> <ins>equivalent to 4.99 percent of</ins> its net income <del>at the same rate of the tax
imposed on individuals under subsection (a.1) of Code Section 48-7-20 for the
corresponding taxable year</del> as computed pursuant to this Code section, and allocated
and apportioned pursuant to Code Section 48-7-31, for such taxable period, and such
shareholders shall not recognize their respective share of the portion of income on
which tax was actually paid pursuant to this subparagraph."
SECTION 3.
Said article is further amended by revising paragraph (3) of subsection (b) of Code
Section 48-7-23, relating to taxation of partnerships, computation of net income,
disallowance of charitable contributions, individual liability of partners, individual returns
of distributive shares, taxable years, and elections, as follows:
"(3) Notwithstanding subsection (a) of this Code section, an electing partnership with
respect to a taxable period shall pay an income tax <del>on</del> <ins>equivalent to 4.99 percent of</ins> its net
income <del>at the same rate of the tax imposed on individuals under subsection (a.1) of Code
Section 48-7-20 for the corresponding taxable year</del> as computed pursuant to this Code
<del>Section</del> <ins>section,</ins> and allocated and apportioned pursuant to Code Section 48-7-31, for
such taxable period, and such partners shall not recognize their respective share of the
portion of income on which tax was actually paid pursuant to this subsection."
SECTION 4.
Said article is further amended by revising the introductory language and paragraph (1) of
subsection (a) of Code Section 48-7-27, relating to computation of taxable net income, as
follows:
"(a) Georgia taxable net income of an individual shall be the taxpayer's federal adjusted
gross income, as defined in the <del>United States</del> Internal Revenue Code of 1986, less:
(1) At the taxpayer's election, either:
(A) The sum of all itemized nonbusiness deductions used in computing such taxpayer's
federal taxable income; or
(B) A standard deduction in an amount as follows:
(i) In the case of a married couple filing a joint return, <del>$24,000.00</del> <ins>$32,000.00;</ins> or
(ii) In the case of a single taxpayer, head of household, or married taxpayer filing a
separate return, <del>$12,000.00</del> <ins>$16,000.00;"
</ins> SECTION 5.
This Act shall become effective on July 1, 2026, and shall be applicable to all taxable years
beginning on or after January 1, 2026.
SECTION 6.
All laws and parts of laws in conflict with this Act are repealed.