The only income tax assessed in Tennessee is the Hall’s Income Tax, which is a 6% tax on earnings from stocks and bonds.
Most folks who are subject to the Hall’s Income Tax have been watching and waiting for the Hall’s Income Tax to be either modified or outright repealed, given recent significant changes to the state’s inheritance tax laws and gift tax laws [inheritance/death taxes phased out/eliminated on 1/1/2016 and gift taxes repealed 7/1/2012]. However, efforts to reduce and/or gradually eliminate the Hall’s Income Tax in prior legislative sessions were not successful. This year, legislation that was introduced on January 14, 2015, and made its way through the House and Senate in April 22, 2015 with only one amendment, was signed by the Governor on May 18, 2015, and became effective for tax years beginning January 2015.
The new law raises the exemption level for the annual Hall Income Tax standard income exemption for citizens age 65 or older from $33,000.00 to $37,000.00 for individual tax payers and from $59,000.00 to $68,000.00 for joint filer taxpayers. The new law also provides for the exemption and income limitation amounts to be adjusted annually for inflation, based upon the percentage change in inflation as measured by the U.S. Bureau of labor statistics. This change in the law will benefit those citizens age 65 and older, who make up approximately half of all the individuals that pay a Hall’s Income Tax.
Sharon Potter has focused her practice in estate and trust planning and probate matters as well as real estate. She strives to provide the best legal services to protect her client’s interests both before and after death, for individuals as well as corporations, LLCs, and other business entities. This includes anything from a basic Will and Durable Power of Attorney to strategic business succession planning and representation in residential and commercial real estate transactions. She is always approachable and enjoys helping her clients understand what the law can do to protect and support their interests. She has lived and served in East Tennessee her entire life and serves both the Knoxville Community but the Crossville Community as well. She will listen with compassion and is perfectly suited to help clients with estate and trust planning, real estate and probate matters as well as business planning.