HB1774
To Exempt From Gross Income A Gain By A Taxpayer Resulting From The Acquisition Of Property Under The Right Of Eminent Domain Or The Threat Of Condemnation.
Last Action (May 1, 2023): Died in House Committee at Sine Die Adjournment
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AI-Generated Summary
House Bill 1774 seeks to amend Arkansas state income tax law to provide a tax exemption for property owners. Specifically, the bill excludes from a taxpayer's gross income any financial gain realized from the sale of real property to an entity exercising the power of eminent domain. This exemption also applies to sales made under the threat of condemnation. The bill applies to actions taken under existing Arkansas statutes regarding eminent domain, specifically those in Title 18, Chapter 15, or Section 27-67-301 and following. The proposed change is set to be effective for tax years beginning on or after January 1, 2023.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries are individual and corporate property owners in Arkansas whose land is acquired by government agencies or other entities possessing eminent domain authority. These taxpayers will benefit by not having to pay state income taxes on the financial gains recognized from such forced or pressured property sales.
Who Might Suffer?
The primary group negatively impacted is the State of Arkansas, as the exemption will result in a decrease in state income tax revenue. This reduction in the tax base could potentially lead to a slight decrease in funds available for state budgetary purposes, though the impact is limited to the specific subset of property owners experiencing eminent domain proceedings.
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