NC Income Surtax Explained

Representative Tim Moore appointed to two committees

September 21, 2009

CLEVELAND COUNTY NEWS -- Tim Moore, Representative for Cleveland County, updates NC District 111 on his appointments to two legislative committees and explains how the new North Carolina income surtax works:

Since session adjourned last month, things have slowed up around the Legislative building in Raleigh. My Legislative office remains open during the interim to handle any questions or concerns you may have, and please feel free to contact us any time.

I have recently been appointed to two committees that will meet during the interim. The two committees are: Joint Legislative Administrative Procedure Oversight Committee and Joint Legislative Elections Oversight Committee. In the past, I served as Co-Chair of the Elections Law and Campaign Finance Committee, and therefore, I have a great interest in elections and look forward to serving on the Elections Oversight Committee. Also, I have previously served on the Joint Legislative Administrative Procedure Oversight Committee. This committee handles administrative law issues. Our committee deals with the Office of Administrative Hearings and the Rules Review Commission, but all rules adopted or proposed by any state agency are subject to review of the Administrative Procedure Oversight Committee.

After the budget was passed and session ended, I heard from several of you regarding the surtax and what it means. Upon reading the information below, it should come as no surprise to you that I voted against the surtaxes and will work to see that they are repealed in the coming session. Our fiscal department sent us the following:

How the Surtax Works:

The surtax is in effect for the 2009 and 2010 tax years. The surtax is based on North Carolina Taxable Income (not Federal AGI), as recorded on Line 13 of the North Carolina D-400 tax form. North Carolina Taxable Income is net of North Carolina deductions, exemptions and other various additions and deductions (i.e. Bailey settlement, NC 529 Plan, etc). The dollar amount reported on Line 13 establishes what surtax rate is imposed. The surtax is then imposed on the amount of North Carolina Income Tax (D-400 Line 14). For example, if a taxpayer filing as a single had income of $87,500 and deductions and exemptions totaling $12,500, their NC Taxable Income (Line 13) would be $75,000. The NC Income Tax (Line 14) would be $5,235 and the surtax amount would be $104.70 ($5,235 * 2%).

Finally, Representative Tim Moore concludes his update with, "It continues to be an honor and privilege to serve you. We look forward to hearing from you. You can reach us at our Raleigh number 919-733-4838 or e-mail us at timm@ncleg.net or Moorela@ngleg.net." As always it is a pleasure to hear from Representative Moore and appreciate his work in informing the public on Legislative issues effecting our lives here in North Carolina.