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1 STATE OF OKLAHOMA
1
2 2nd Session of the 60th Legislature (2026)
2
3 SENATE BILL 1856 By: Deevers
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4
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5
5
6 AS INTRODUCED
6
7 An Act relating to tax; amending 68 O.S. 2021,
7 Section 2355, as last amended by Section 2, Chapter
8 307, O.S.L. 2025 (68 O.S. Supp. 2025, Section 2355),
8 which relates to income tax; requiring income tax
9 rate reduction upon certification of collections in
9 excess of prior year collections; prescribing
10 thresholds for reduction amounts; prescribing
10 calculation of collection amounts; updating statutory
11 reference; and providing an effective date.
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12
12
13
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14 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
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15 SECTION 1. AMENDATORY 68 O.S. 2021, Section 2355, as
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16 last amended by Section 2, Chapter 307, O.S.L. 2025 (68 O.S. Supp.
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17 2025, Section 2355), is amended to read as follows:
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18 Section 2355. A. Individuals. For all taxable years beginning
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19 after December 31, 1998, and before January 1, 2006, a tax is hereby
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20 imposed upon the Oklahoma taxable income of every resident or
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21 nonresident individual, which tax shall be computed at the option of
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22 the taxpayer under one of the two following methods:
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23 1. METHOD 1.
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Req. No. 3473 Page 1
1 a. Single individuals and married individuals filing
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2 separately not deducting federal income tax:
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3 (1) 1/2% tax on first $1,000.00 or part thereof,
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4 (2) 1% tax on next $1,500.00 or part thereof,
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5 (3) 2% tax on next $1,250.00 or part thereof,
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6 (4) 3% tax on next $1,150.00 or part thereof,
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7 (5) 4% tax on next $1,300.00 or part thereof,
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8 (6) 5% tax on next $1,500.00 or part thereof,
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9 (7) 6% tax on next $2,300.00 or part thereof, and
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10 (8) (a) for taxable years beginning after December
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11 31, 1998, and before January 1, 2002, 6.75%
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12 tax on the remainder,
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13 (b) for taxable years beginning on or after
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14 January 1, 2002, and before January 1, 2004,
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15 7% tax on the remainder, and
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16 (c) for taxable years beginning on or after
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17 January 1, 2004, 6.65% tax on the remainder.
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18 b. Married individuals filing jointly and surviving
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19 spouse to the extent and in the manner that a
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20 surviving spouse is permitted to file a joint return
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21 under the provisions of the Internal Revenue Code of
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22 1986, as amended, and heads of households as defined
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23 in the Internal Revenue Code of 1986, as amended, not
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24 deducting federal income tax:
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Req. No. 3473 Page 2
1 (1) 1/2% tax on first $2,000.00 or part thereof,
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2 (2) 1% tax on next $3,000.00 or part thereof,
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3 (3) 2% tax on next $2,500.00 or part thereof,
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4 (4) 3% tax on next $2,300.00 or part thereof,
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5 (5) 4% tax on next $2,400.00 or part thereof,
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6 (6) 5% tax on next $2,800.00 or part thereof,
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7 (7) 6% tax on next $6,000.00 or part thereof, and
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8 (8) (a) for taxable years beginning after December
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9 31, 1998, and before January 1, 2002, 6.75%
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10 tax on the remainder,
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11 (b) for taxable years beginning on or after
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12 January 1, 2002, and before January 1, 2004,
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13 7% tax on the remainder, and
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14 (c) for taxable years beginning on or after
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15 January 1, 2004, 6.65% tax on the remainder.
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16 2. METHOD 2.
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17 a. Single individuals and married individuals filing
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18 separately deducting federal income tax:
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19 (1) 1/2% tax on first $1,000.00 or part thereof,
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20 (2) 1% tax on next $1,500.00 or part thereof,
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21 (3) 2% tax on next $1,250.00 or part thereof,
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22 (4) 3% tax on next $1,150.00 or part thereof,
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23 (5) 4% tax on next $1,200.00 or part thereof,
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24 (6) 5% tax on next $1,400.00 or part thereof,
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Req. No. 3473 Page 3
1 (7) 6% tax on next $1,500.00 or part thereof,
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2 (8) 7% tax on next $1,500.00 or part thereof,
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3 (9) 8% tax on next $2,000.00 or part thereof,
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4 (10) 9% tax on next $3,500.00 or part thereof, and
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5 (11) 10% tax on the remainder.
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6 b. Married individuals filing jointly and surviving
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7 spouse to the extent and in the manner that a
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8 surviving spouse is permitted to file a joint return
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9 under the provisions of the Internal Revenue Code of
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10 1986, as amended, and heads of households as defined
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11 in the Internal Revenue Code of 1986, as amended,
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12 deducting federal income tax:
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13 (1) 1/2% tax on the first $2,000.00 or part thereof,
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14 (2) 1% tax on the next $3,000.00 or part thereof,
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15 (3) 2% tax on the next $2,500.00 or part thereof,
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16 (4) 3% tax on the next $1,400.00 or part thereof,
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17 (5) 4% tax on the next $1,500.00 or part thereof,
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18 (6) 5% tax on the next $1,600.00 or part thereof,
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19 (7) 6% tax on the next $1,250.00 or part thereof,
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20 (8) 7% tax on the next $1,750.00 or part thereof,
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21 (9) 8% tax on the next $3,000.00 or part thereof,
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22 (10) 9% tax on the next $6,000.00 or part thereof, and
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23 (11) 10% tax on the remainder.
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Req. No. 3473 Page 4
1 B. Individuals. For all taxable years beginning on or after
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2 January 1, 2008, and ending any tax year which begins after December
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3 31, 2015, for which the determination required pursuant to Sections
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4 2355.1F and 2355.1G of this title is made by the State Board of
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5 Equalization, a tax is hereby imposed upon the Oklahoma taxable
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6 income of every resident or nonresident individual, which tax shall
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7 be computed as follows:
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8 1. Single individuals and married individuals filing
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9 separately:
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10 (a) 1/2% tax on first $1,000.00 or part thereof,
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11 (b) 1% tax on next $1,500.00 or part thereof,
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12 (c) 2% tax on next $1,250.00 or part thereof,
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13 (d) 3% tax on next $1,150.00 or part thereof,
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14 (e) 4% tax on next $2,300.00 or part thereof,
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15 (f) 5% tax on next $1,500.00 or part thereof,
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16 (g) 5.50% tax on the remainder for the 2008 tax year and
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17 any subsequent tax year unless the rate prescribed by
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18 subparagraph (h) of this paragraph is in effect, and
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19 (h) 5.25% tax on the remainder for the 2009 and subsequent
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20 tax years. The decrease in the top marginal
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21 individual income tax rate otherwise authorized by
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22 this subparagraph shall be contingent upon the
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23 determination required to be made by the State Board
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1 of Equalization pursuant to Section 2355.1A of this
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2 title.
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3 2. Married individuals filing jointly and surviving spouse to
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4 the extent and in the manner that a surviving spouse is permitted to
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5 file a joint return under the provisions of the Internal Revenue
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6 Code of 1986, as amended, and heads of households as defined in the
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7 Internal Revenue Code of 1986, as amended:
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8 (a) 1/2% tax on first $2,000.00 or part thereof,
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9 (b) 1% tax on next $3,000.00 or part thereof,
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10 (c) 2% tax on next $2,500.00 or part thereof,
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11 (d) 3% tax on next $2,300.00 or part thereof,
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12 (e) 4% tax on next $2,400.00 or part thereof,
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13 (f) 5% tax on next $2,800.00 or part thereof,
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14 (g) 5.50% tax on the remainder for the 2008 tax year and
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15 any subsequent tax year unless the rate prescribed by
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16 subparagraph (h) of this paragraph is in effect, and
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17 (h) 5.25% tax on the remainder for the 2009 and subsequent
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18 tax years. The decrease in the top marginal
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19 individual income tax rate otherwise authorized by
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20 this subparagraph shall be contingent upon the
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21 determination required to be made by the State Board
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22 of Equalization pursuant to Section 2355.1A of this
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23 title.
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Req. No. 3473 Page 6
1 C. Individuals. For tax years 2024 and 2025, a tax is hereby
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2 imposed upon the Oklahoma taxable income of every resident or
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3 nonresident individual, which tax shall be computed as follows:
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4 1. Single individuals and married individuals filing
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5 separately:
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6 (a) 0.25% tax on first $1,000.00 or part thereof,
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7 (b) 0.75% tax on next $1,500.00 or part thereof,
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8 (c) 1.75% tax on next $1,250.00 or part thereof,
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9 (d) 2.75% tax on next $1,150.00 or part thereof,
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10 (e) 3.75% tax on next $2,300.00 or part thereof, and
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11 (f) 4.75% tax on the remainder.
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12 2. Married individuals filing jointly and surviving spouse to
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13 the extent and in the manner that a surviving spouse is permitted to
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14 file a joint return under the provisions of the Internal Revenue
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15 Code of 1986, as amended, and heads of households as defined in the
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16 Internal Revenue Code of 1986, as amended:
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17 (a) 0.25% tax on first $2,000.00 or part thereof,
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18 (b) 0.75% tax on next $3,000.00 or part thereof,
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19 (c) 1.75% tax on next $2,500.00 or part thereof,
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20 (d) 2.75% tax on next $2,300.00 or part thereof,
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21 (e) 3.75% tax on next $4,600.00 or part thereof, and
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22 (f) 4.75% tax on the remainder.
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23 No deduction for federal income taxes paid shall be allowed to
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24 any taxpayer to arrive at taxable income.
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Req. No. 3473 Page 7
1 D. Individuals. For tax year 2026 and for subsequent tax years
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2 subject to rate reductions as provided by subsection subsections E
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3 and L of this section, a tax is hereby imposed upon the Oklahoma
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4 taxable income of every resident or nonresident individual, which
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5 tax shall be computed as follows:
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6 1. Single individuals and married individuals filing
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7 separately:
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8 (a) 0% tax on first $3,750.00 or part thereof,
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9 (b) 2.5% tax on the next $1,150.00 or part thereof,
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10 (c) 3.5% tax on next $2,300.00 or part thereof, and
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11 (d) 4.5% tax on the remainder.
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12 2. Married individuals filing jointly and surviving spouse to
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13 the extent and in the manner that a surviving spouse is permitted to
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14 file a joint return under the provisions of the Internal Revenue
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15 Code of 1986, as amended, and heads of households as defined in the
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16 Internal Revenue Code of 1986, as amended:
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17 (a) 0% tax on first $7,500.00 or part thereof,
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18 (b) 2.5% tax on the next $2,300.00 or part thereof,
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19 (c) 3.5% tax on next $4,600.00 or part thereof, and
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20 (d) 4.5% tax on the remainder.
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21 No deduction for federal income taxes paid shall be allowed to
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22 any taxpayer to arrive at taxable income.
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23 E. As provided by subsection D of Section 34.103 of Title 62 of
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24 the Oklahoma Statutes, if the comparison year total collections
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Req. No. 3473 Page 8
1 exceeds the base year total collections plus the income tax rate
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2 reduction threshold, as certified by the State Board of Equalization
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3 pursuant to paragraph 2 of subsection D of Section 34.103 of Title
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4 62 of the Oklahoma Statutes, the tax rates otherwise prescribed in
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5 paragraphs 1 and 2 of subsection D of this section shall each be
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6 reduced by twenty-five one-hundredths (0.25) of a percentage point
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7 (0.0025) until the applicable rate equals zero percent (0%). Each
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8 successive certification by the State Board of Equalization with
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9 respect to which the comparison year total collections exceeds the
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10 base year total collections plus the income tax rate reduction
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11 threshold, as determined by the State Board of Equalization as
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12 provided by subsection D of Section 34.103 of Title 62 of the
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13 Oklahoma Statutes, shall further reduce the individual income tax
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14 rates by twenty-five one-hundredths (0.25) of a percentage point
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15 (0.0025) until the applicable rate equals zero percent (0%). Any
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16 reduction in the income tax rates authorized by this section and by
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17 this act Sections 34.103 and 34.103A of Title 62 of the Oklahoma
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18 Statutes shall take effect on January 1 following the final
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19 certification by the State Board of Equalization, if any, made
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20 during its meeting in February each year.
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21 F. If a revenue failure is declared pursuant to the provisions
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22 of Section 34.49 of Title 62 of the Oklahoma Statutes prior to the
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23 end of the calendar year in which the Board makes a certification
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24 pursuant to paragraph 2 of subsection D of Section 34.103 of Title
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1 62 of the Oklahoma Statutes, the reduction in tax rates, as
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2 otherwise provided for in this section, shall not occur until a
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3 subsequent certification is made by the State Board of Equalization
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4 pursuant to paragraph 2 of subsection D of Section 34.103 of Title
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5 62 of the Oklahoma Statutes.
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6 G. Nonresident aliens. In lieu of the rates set forth in
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7 subsection A above, there shall be imposed on nonresident aliens, as
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8 defined in the Internal Revenue Code of 1986, as amended, a tax of
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9 eight percent (8%) instead of thirty percent (30%) as used in the
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10 Internal Revenue Code of 1986, as amended, with respect to the
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11 Oklahoma taxable income of such nonresident aliens as determined
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12 under the provision of the Oklahoma Income Tax Act.
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13 Every payer of amounts covered by this subsection shall deduct
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14 and withhold from such amounts paid each payee an amount equal to
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15 eight percent (8%) thereof. Every payer required to deduct and
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16 withhold taxes under this subsection shall for each quarterly period
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17 on or before the last day of the month following the close of each
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18 such quarterly period, pay over the amount so withheld as taxes to
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19 the Oklahoma Tax Commission, and shall file a return with each such
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20 payment. Such return shall be in such form as the Tax Commission
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21 shall prescribe. Every payer required under this subsection to
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22 deduct and withhold a tax from a payee shall, as to the total
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23 amounts paid to each payee during the calendar year, furnish to such
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24 payee, on or before January 31 of the succeeding year, a written
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Req. No. 3473 Page 10
1 statement showing the name of the payer, the name of the payee and
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2 the payee's Social Security account number, if any, the total amount
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3 paid subject to taxation, and the total amount deducted and withheld
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4 as tax and such other information as the Tax Commission may require.
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5 Any payer who fails to withhold or pay to the Tax Commission any
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6 sums herein required to be withheld or paid shall be personally and
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7 individually liable therefor to the State of Oklahoma.
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8 H. Corporations. For all taxable years beginning after
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9 December 31, 2021, a tax is hereby imposed upon the Oklahoma taxable
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10 income of every corporation doing business within this state or
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11 deriving income from sources within this state in an amount equal to
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12 four percent (4%) thereof.
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13 There shall be no additional Oklahoma income tax imposed on
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14 accumulated taxable income or on undistributed personal holding
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15 company income as those terms are defined in the Internal Revenue
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16 Code of 1986, as amended.
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17 I. Certain foreign corporations. In lieu of the tax imposed in
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18 the first paragraph of subsection G of this section, for all taxable
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19 years beginning after December 31, 2021, there shall be imposed on
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20 foreign corporations, as defined in the Internal Revenue Code of
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21 1986, as amended, a tax of four percent (4%) instead of thirty
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22 percent (30%) as used in the Internal Revenue Code of 1986, as
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23 amended, where such income is received from sources within this
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1 state, in accordance with the provisions of the Internal Revenue
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2 Code of 1986, as amended, and the Oklahoma Income Tax Act.
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3 Every payer of amounts covered by this subsection shall deduct
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4 and withhold from such amounts paid each payee an amount equal to
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5 four percent (4%) thereof. Every payer required to deduct and
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6 withhold taxes under this subsection shall for each quarterly period
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7 on or before the last day of the month following the close of each
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8 such quarterly period, pay over the amount so withheld as taxes to
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9 the Tax Commission, and shall file a return with each such payment.
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10 Such return shall be in such form as the Tax Commission shall
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11 prescribe. Every payer required under this subsection to deduct and
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12 withhold a tax from a payee shall, as to the total amounts paid to
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13 each payee during the calendar year, furnish to such payee, on or
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14 before January 31 of the succeeding year, a written statement
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15 showing the name of the payer, the name of the payee and the payee's
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16 Social Security account number, if any, the total amounts paid
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17 subject to taxation, the total amount deducted and withheld as tax,
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18 and such other information as the Tax Commission may require. Any
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19 payer who fails to withhold or pay to the Tax Commission any sums
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20 herein required to be withheld or paid shall be personally and
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21 individually liable therefor to the State of Oklahoma.
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22 J. Fiduciaries. A tax is hereby imposed upon the Oklahoma
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23 taxable income of every trust and estate at the same rates as are
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24 provided in subsections B through D of this section for single
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Req. No. 3473 Page 12
1 individuals. Fiduciaries are not allowed a deduction for any
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2 federal income tax paid.
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3 K. Tax rate tables. For all taxable years beginning after
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4 December 31, 1991, in lieu of the tax imposed by subsections A
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5 through D of this section, as applicable there is hereby imposed for
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6 each taxable year on the taxable income of every individual, whose
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7 taxable income for such taxable year does not exceed the ceiling
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8 amount, a tax determined under tables, applicable to such taxable
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9 year which shall be prescribed by the Tax Commission and which shall
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10 be in such form as it determines appropriate. In the table so
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11 prescribed, the amounts of the tax shall be computed on the basis of
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12 the rates prescribed by subsections A through D of this section.
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13 For purposes of this subsection, the term "ceiling amount" means,
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14 with respect to any taxpayer, the amount determined by the Tax
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15 Commission for the tax rate category in which such taxpayer falls.
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16 L. 1. Beginning tax year 2027, in addition to any rate
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17 reductions provided for in subsection E of this section, if the
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18 comparison year total collections reported pursuant to the
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19 provisions of Section 34.103 of Title 62 of the Oklahoma Statutes
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20 for the December meeting of the State Board of Equalization
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21 immediately preceding the tax year exceed the comparison year total
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22 collections reported in the immediate preceding December meeting by
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23 at least Two Hundred Million Dollars ($200,000,000.00), the tax
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24 rates otherwise prescribed in paragraphs 1 and 2 of subsection D of
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Req. No. 3473 Page 13
1 this section shall each be reduced by the following percentage
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2 points until the applicable rate equals zero percent (0%):
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3 a. if the excess is at least Two Hundred Million Dollars
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4 ($200,000,000.00) but less than Three Hundred Million
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5 Dollars ($300,000,000.00), one hundred twenty-five
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6 one-thousandths (0.125) of a percentage point,
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7 b. if the excess is at least Three Hundred Million
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8 Dollars ($300,000,000.00) but less than Four Hundred
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9 Million Dollars ($400,000,000.00), twenty-five one-
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10 hundredths (0.25) of a percentage point,
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11 c. if the excess is at least Four Hundred Million Dollars
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12 ($400,000,000.00) but less than Five Hundred Million
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13 Dollars ($500,000,000.00), three hundred seventy-five
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14 one-thousandths (0.375) of a percentage point, and
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15 d. if the excess is at least Five Hundred Million Dollars
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16 ($500,000,000.00), fifty one-hundredths (0.50) of a
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17 percentage point.
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18 2. Any increment of comparison year total collections above the
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19 minimum thresholds provided pursuant to subparagraphs a through c of
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20 paragraph 1 of this subsection that do not exceed the minimum
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21 threshold of the subsequent subparagraph, or any increment above the
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22 minimum threshold provided by subparagraph d of paragraph 1 of this
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23 subsection, shall be added to the comparison year total collections
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24 certified in the subsequent December meeting of the State Board of
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Req. No. 3473 Page 14
1 Equalization for the purpose of calculating the rate reductions
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2 required by this subsection.
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3 SECTION 2. This act shall become effective November 1, 2026.
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5 60-2-3473 QD 1/15/2026 1:26:04 AM
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Req. No. 3473 Page 15Every fact on this page links to its source, starting with the official bill record.