GARDEN CITY, Kan. (KSNW) – The new tax structure for Kansas takes effect tomorrow. Its goal is to help balance the budget, but it will raise income taxes and re-impose the LLC tax.
“Paying taxes is a civic duty,” said small business owner Debbie Wharton. She had mixed feelings when she first learned about the 2012 LLC tax cut. “Are they crazy? And yay! Yippie for us!”
She says nobody likes paying taxes, but she understands the effect the LLC tax break had on the state.
“It’s great not to have to pay them, but I still like to have nice roads, and when I dial 9-1-1, I want somebody to show up.”
The new tax structure takes effect July 1, which means an increase in income taxes.
The LLC tax is retroactive, meaning businesses will have to file taxes on revenue from the beginning of the calendar year.
Normally, there’s a penalty for missing a quarterly payment.
“They’re going to waive those penalties,” said David Hetrick, a certified public accountant. “Since they changed the rules in the middle of the year, as long as the business owner pays their taxes by April 15th.”
Even though Wharton says she budgeted for a situation like this, she may still have to make sacrifices to follow the new rules.
“I may have to eat Ramen noodles,” she laughed. “Hopefully I’ve been an ant and not a grasshopper, so it shouldn’t, I should not spend as much on Christmas as I was going to.”
Wharton is looking at the positives.
“I’m just thankful that I have to be able to pay taxes, because it means that I’ve been successful,” added Wharton.
The new tax structure also means an increase in income tax.
If you are married and filing jointly and make up to $30,000 your rate will increase by .4 percent.
If you earn between $30,000 and $60,000, it will increase by .65 percent.
If you make more than $60,000, your rate will increase by more than one percent.
For single filers, rates will be the same as joint filings, but the income brackets are half the size.