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1 STATE OF OKLAHOMA
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2 1st Session of the 60th Legislature (2025)
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3 SENATE BILL 327 By: Kirt
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5
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6 AS INTRODUCED
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7 An Act relating to tax; amending 68 O.S. 2021,
7 Section 2355, as last amended by Section 1, Chapter
8 27, 1st Extraordinary Session, O.S.L. 2023 (68 O.S.
8 Supp. 2024, Section 2355), which relates to income
9 tax; modifying certain income tax rate for certain
9 tax years; modifying certain withholding requirement
10 for certain tax years; updating statutory references;
10 updating statutory language; and providing an
11 effective date.
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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 1, Chapter 27, 1st Extraordinary Session,
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17 O.S.L. 2023 (68 O.S. Supp. 2024, Section 2355), is amended to read
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18 as follows:
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19 Section 2355. A. Individuals. For all taxable years beginning
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20 after December 31, 1998, and before January 1, 2006, a tax is hereby
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21 imposed upon the Oklahoma taxable income of every resident or
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22 nonresident individual, which tax shall be computed at the option of
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23 the taxpayer under one of the two following methods:
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24 1. METHOD 1.
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Req. No. 635 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. 635 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. 635 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. 635 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 4 and 5 2355.1F of this act 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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Req. No. 635 Page 5
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. 635 Page 6
1 C. Individuals. For all taxable years beginning on or after
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2 January 1, 2024 tax year 2024, a tax is hereby imposed upon the
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3 Oklahoma taxable income of every resident or nonresident individual,
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4 which tax shall be computed as follows:
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5 1. Single individuals and married individuals filing
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6 separately:
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7 (a) 0.25% tax on first $1,000.00 or part thereof,
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8 (b) 0.75% tax on next $1,500.00 or part thereof,
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9 (c) 1.75% tax on next $1,250.00 or part thereof,
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10 (d) 2.75% tax on next $1,150.00 or part thereof,
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11 (e) 3.75% tax on next $2,300.00 or part thereof, and
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12 (f) 4.75% tax on the remainder.
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13 2. Married individuals filing jointly and surviving spouse to
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14 the extent and in the manner that a surviving spouse is permitted to
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15 file a joint return under the provisions of the Internal Revenue
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16 Code of 1986, as amended, and heads of households as defined in the
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17 Internal Revenue Code of 1986, as amended:
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18 (a) 0.25% tax on first $2,000.00 or part thereof,
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19 (b) 0.75% tax on next $3,000.00 or part thereof,
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20 (c) 1.75% tax on next $2,500.00 or part thereof,
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21 (d) 2.75% tax on next $2,300.00 or part thereof,
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22 (e) 3.75% tax on next $4,600.00 or part thereof, and
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23 (f) 4.75% tax on the remainder.
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Req. No. 635 Page 7
1 No deduction for federal income taxes paid shall be allowed to
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2 any taxpayer to arrive at taxable income.
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3 D. Individuals. For tax year 2025 and subsequent tax years, a
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4 tax is hereby imposed upon the Oklahoma taxable income of every
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5 resident or nonresident individual, which tax shall be computed as
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6 follows:
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7 1. Single individuals and married individuals filing
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8 separately:
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9 (a) 0.00% tax on first $25,000.00 or part thereof,
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10 (b) 1.00% tax on next $15,000.00 or part thereof,
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11 (c) 2.00% tax on next $15,000.00 or part thereof,
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12 (d) 3.00% tax on next $15,000.00 or part thereof,
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13 (e) 4.00% tax on next $15,000.00 or part thereof, and
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14 (f) 4.75% tax on the remainder.
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15 2. Married individuals filing jointly and surviving spouse to
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16 the extent and in the manner that a surviving spouse is permitted to
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17 file a joint return under the provisions of the Internal Revenue
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18 Code of 1986, as amended, and heads of households as defined in the
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19 Internal Revenue Code of 1986, as amended:
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20 (a) 0.00% tax on first $50,000.00 or part thereof,
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21 (b) 1.00% tax on next $30,000.00 or part thereof,
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22 (c) 2.00% tax on next $30,000.00 or part thereof,
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23 (d) 3.00% tax on next $30,000.00 or part thereof,
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24 (e) 4.00% tax on next $30,000.00 or part thereof, and
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Req. No. 635 Page 8
1 (f) 4.75% tax on the remainder.
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2 No deduction for federal income taxes paid shall be allowed to
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3 any taxpayer to arrive at taxable income.
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4 E. Nonresident aliens. In lieu of the rates set forth in
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5 subsection A above, there shall be imposed on nonresident aliens, as
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6 defined in the Internal Revenue Code of 1986, as amended, a tax of
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7 eight percent (8%) instead of thirty percent (30%) as used in the
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8 Internal Revenue Code of 1986, as amended, with respect to the
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9 Oklahoma taxable income of such nonresident aliens as determined
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10 under the provision of the Oklahoma Income Tax Act.
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11 Every payer of amounts covered by this subsection shall deduct
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12 and withhold from such amounts paid each payee an amount equal to
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13 eight percent (8%) thereof. Every payer required to deduct and
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14 withhold taxes under this subsection shall for each quarterly period
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15 on or before the last day of the month following the close of each
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16 such quarterly period, pay over the amount so withheld as taxes to
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17 the Oklahoma Tax Commission, and shall file a return with each such
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18 payment. Such return shall be in such form as the Tax Commission
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19 shall prescribe. Every payer required under this subsection to
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20 deduct and withhold a tax from a payee shall, as to the total
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21 amounts paid to each payee during the calendar year, furnish to such
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22 payee, on or before January 31, of the succeeding year, a written
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23 statement showing the name of the payer, the name of the payee and
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24 the payee's Social Security account number, if any, the total amount
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Req. No. 635 Page 9
1 paid subject to taxation, and the total amount deducted and withheld
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2 as tax and such other information as the Tax Commission may require.
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3 Any payer who fails to withhold or pay to the Tax Commission any
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4 sums herein required to be withheld or paid shall be personally and
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5 individually liable therefor to the State of Oklahoma.
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6 E. F. Corporations. For all taxable years beginning after
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7 December 31, 2021, a tax is hereby imposed upon the Oklahoma taxable
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8 income of every corporation doing business within this state or
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9 deriving income from sources within this state in an amount equal to
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10 four percent (4%) thereof.
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11 There shall be no additional Oklahoma income tax imposed on
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12 accumulated taxable income or on undistributed personal holding
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13 company income as those terms are defined in the Internal Revenue
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14 Code of 1986, as amended.
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15 F. G. Certain foreign corporations. In lieu of the tax imposed
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16 in the first paragraph of subsection D F of this section, for all
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17 taxable years beginning after December 31, 2021, there shall be
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18 imposed on foreign corporations, as defined in the Internal Revenue
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19 Code of 1986, as amended, a tax of four percent (4%) instead of
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20 thirty percent (30%) as used in the Internal Revenue Code of 1986,
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21 as amended, where such income is received from sources within
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22 Oklahoma this state, in accordance with the provisions of the
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23 Internal Revenue Code of 1986, as amended, and the Oklahoma Income
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24 Tax Act.
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Req. No. 635 Page 10
1 Every payer of amounts covered by this subsection shall deduct
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2 and withhold from such amounts paid each payee an amount equal to
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3 four percent (4%) thereof. Every payer required to deduct and
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4 withhold taxes under this subsection shall for each quarterly period
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5 on or before the last day of the month following the close of each
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6 such quarterly period, pay over the amount so withheld as taxes to
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7 the Tax Commission, and shall file a return with each such payment.
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8 Such return shall be in such form as the Tax Commission shall
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9 prescribe. Every payer required under this subsection to deduct and
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10 withhold a tax from a payee shall, as to the total amounts paid to
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11 each payee during the calendar year, furnish to such payee, on or
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12 before January 31, of the succeeding year, a written statement
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13 showing the name of the payer, the name of the payee and the payee's
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14 Social Security account number, if any, the total amounts paid
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15 subject to taxation, the total amount deducted and withheld as tax,
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16 and such other information as the Tax Commission may require. Any
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17 payer who fails to withhold or pay to the Tax Commission any sums
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18 herein required to be withheld or paid shall be personally and
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19 individually liable therefor to the State of Oklahoma.
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20 G. H. Fiduciaries. A tax is hereby imposed upon the Oklahoma
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21 taxable income of every trust and estate at the same rates as are
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22 provided in subsection B or C subsections B through D of this
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23 section for single individuals. Fiduciaries are not allowed a
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24 deduction for any federal income tax paid.
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Req. No. 635 Page 11
1 H. I. Tax rate tables. For all taxable years beginning after
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2 December 31, 1991, in lieu of the tax imposed by subsection A, B or
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3 C subsections A through D of this section, as applicable there is
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4 hereby imposed for each taxable year on the taxable income of every
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5 individual, whose taxable income for such taxable year does not
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6 exceed the ceiling amount, a tax determined under tables, applicable
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7 to such taxable year which shall be prescribed by the Tax Commission
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8 and which shall be in such form as it determines appropriate. In
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9 the table so prescribed, the amounts of the tax shall be computed on
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10 the basis of the rates prescribed by subsection A, B or C
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11 subsections A through D of this section. For purposes of this
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12 subsection, the term "ceiling amount" means, with respect to any
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13 taxpayer, the amount determined by the Tax Commission for the tax
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14 rate category in which such taxpayer falls.
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15 SECTION 2. This act shall become effective November 1, 2025.
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17 60-1-635 QD 12/31/2024 12:42:59 PM
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Req. No. 635 Page 12Every fact on this page links to its source, starting with the official bill record.