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Federal Travel Regulation; Relocation Income Tax (RIT) Allowance Tax Tables-2007 Update

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AGENCY:

Office of Governmentwide Policy, GSA.

ACTION:

Final rule.

SUMMARY:

This rule updates the Federal, State, and Puerto Rico tax tables for calculating the relocation income tax (RIT) allowance, to reflect changes in Federal, State, and Puerto Rico income tax brackets and rates. The Federal, State, and Puerto Rico tax tables contained in this rule are for use in calculating the 2007 RIT allowance to be paid to relocating Federal employees.

DATES:

Effective Date: This final rule is effective April 9, 2007.

Applicability date: This final rule provides tax information for filing 2006 Federal and State income taxes.

Start Further Info

FOR FURTHER INFORMATION CONTACT:

The Regulatory Secretariat (VIR), Room 4035, GSA Building, Washington, DC 20405, telephone (202) 501-4755, for information pertaining to status or publication schedules. For clarification of content, contact Ed Davis, Office of Governmentwide Policy, Travel Management Policy (MTT), Washington, DC 20405, telephone (202) 208-7638. Please cite FTR Amendment 2007-02, FTR case 2007-302.

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SUPPLEMENTARY INFORMATION:

A. Background

Section 5724b of Title 5, United States Code, provides for reimbursement of substantially all Federal, State, and local income taxes incurred by a transferred Federal employee on taxable moving expense reimbursements. Policies and procedures for the calculation and payment of the RIT allowance are contained in the Federal Travel Regulation (41 CFR part 302-17). GSA updates Federal, State, and Puerto Rico tax tables for calculating RIT allowance payments yearly to reflect changes in Federal, State, and Puerto Rico income tax brackets and rates.

This amendment also provides a tax table necessary to compute the RIT allowance for employees who received reimbursement for relocation expenses in 2006.

B. Executive Order 12866

This regulation is excepted from the definition of “regulation” or “rule” under Section 3(d)(3) of Executive Order 12866, Regulatory Planning and Review, dated September 30, 1993 and, therefore, was not subject to review under Section 6(b) of that Executive Order.

C. Regulatory Flexibility Act

This final rule is not required to be published in the Federal Register for notice and comment as per the exemption specified in 5 U.S.C. 553(a)(2); therefore, the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., does not apply.

D. Paperwork Reduction Act

The Paperwork Reduction Act does not apply because this final rule does not impose recordkeeping or information collection requirements, or the collection of information from offerors, contractors, or members of the public that require the approval of the Office of Management and Budget under 44 U.S.C. 3501 et seq.

E. Small Business Regulatory Enforcement Fairness Act

This final rule is also exempt from Congressional review prescribed under 5 U.S.C. 801 since it relates solely to agency management and personnel.

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List of Subjects in 41 CFR Part 302-17

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Dated: March 23, 2007.

Lurita Doan,

Administrator of General Services.

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For the reasons set forth in the preamble, under

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PART 302-17—RELOCATION INCOME TAX (RIT) ALLOWANCE

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1. The authority citation for

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Authority: 5 U.S.C. 5738; 20 U.S.C. 905(a); E.O. 11609, 36 FR 13747, 3 CFR, 1971-1975 Comp., p. 586.

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2. Revise Appendices A, B, C, and D to part 302-17 to read as follows:

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Appendix A to Part 302-17—Federal Tax Tables for RIT Allowance

Federal Marginal Tax Rates by Earned Income Level and Filing Status—Tax Year 2006

[Use the following table to compute the RIT allowance for Federal taxes, as prescribed in § 302-17.8(e)(1), on Year 1 marginal taxable reimbursements received during calendar year 2006]

Marginal tax rateSingle taxpayerHead of householdMarried filing jointly/qualifying widows & widowersMarried filing separately
PercentOverBut not overOverBut not overOverBut not overOverBut not over
10$8,739$16,560$16,538$27,374$24,163$38,534$12,036$19,194
1516,56041,04127,37459,52638,53486,18219,19443,330
2541,04188,54159,526128,60586,182154,78643,33079,441
2888,541175,222128,605203,511154,786224,81879,441114,716
33175,222360,212203,511375,305224,818374,173114,716188,184
35360,212375,305374,173188,184
End Appendix Start Appendix

Appendix B to Part 302-17—State Tax Tables for RIT AllowanceStart Printed Page 17411

State Marginal Tax Rates by Earned Income Level—Tax Year 2006

[Use the following table to compute the RIT allowance for State taxes, as prescribed in § 302-17.8(e)(2), on taxable reimbursements received during calendar year 2006. The rates on the first line for each State are for employees who are married and file jointly; if there is a second line for a State, it displays the rates for employees who file as single. For more additional information, such as State rates for other filing statuses, please see the 2007 State Tax Handbook, pp. 255-270, available from CCH Inc., http://tax.cchgroup.com/​Books/​default.]

Marginal tax rates (stated in percents) for the earned income amounts specified in each column.123
State (or District)$20,000-$24,999$25,000-$49,999$50,000-$74,999$75,000 & over 4
Alabama5.005.005.005.00
Alaska0.000.000.000.00
Arizona3.043.043.553.55
If single status, married filing separately 53.043.554.484.48
Arkansas6.007.007.007.00
California2.006.009.309.30
If single status, married filing separately 56.008.009.309.30
Colorado4.634.634.634.63
Connecticut5.005.005.005.00
Delaware5.205.555.955.95
District of Columbia7.007.008.708.70
Florida0.000.000.000.00
Georgia6.006.006.006.00
Hawaii6.407.607.908.25
If single status, married filing separately 57.607.908.258.25
Idaho7.407.807.807.80
If single status, married filing separately 57.807.807.807.80
Illinois3.003.003.003.00
Indiana3.403.403.403.40
Iowa6.487.928.988.98
Kansas6.256.456.456.45
Kentucky5.805.805.806.00
Louisiana2.004.006.006.00
If single status, married filing separately 54.006.006.006.00
Maine7.008.508.508.50
If single status, married filing separately 58.508.508.508.50
Maryland4.754.754.754.75
Massachusetts5.305.305.305.30
Michigan3.903.903.903.90
Minnesota5.357.057.057.05
If single status, married filing separately 57.057.057.857.85
Mississippi5.005.005.005.00
Missouri6.006.006.006.00
Montana6.906.906.906.90
Nebraska3.576.846.846.84
If single status, married filing separately 55.126.846.846.84
Nevada0.000.000.000.00
New Hampshire0.000.000.000.00
New Jersey1.751.753.505.525
If single status, married filing separately 51.755.5255.5256.370
New Mexico5.305.305.305.30
New York5.256.856.856.85
If single status, married filing separately 56.856.856.856.85
North Carolina7.007.007.007.00
If single status, married filing separately 57.007.007.757.75
North Dakota2.102.103.923.92
If single status, married filing separately 52.103.924.344.34
Ohio4.0834.0834.7645.444
Oklahoma6.256.256.256.25
Oregon9.009.009.009.00
Pennsylvania3.073.073.073.07
Rhode Island 63.757.007.007.00
If single status, married filing separately 53.757.007.007.75
South Carolina7.007.007.007.00
South Dakota0.000.000.000.00
Tennessee0.000.000.000.00
Texas0.000.000.000.00
Utah6.986.986.986.98
Vermont3.603.607.207.20
If single status, married filing separately 53.607.208.508.50
Virginia5.755.755.755.75
Washington0.000.000.000.00
West Virginia4.006.006.506.50
Wisconsin6.506.506.506.50
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Wyoming0.000.000.000.00
[The above table/column headings established by IRS.]
1 Earned income amounts that fall between the income brackets shown in this table (e.g., $24,999.45, $49,999.75) should be rounded to the nearest dollar to determine the marginal tax rate to be used in calculating the RIT allowance.
2 If the earned income amount is less than the lowest income bracket shown in this table, the employing agency shall establish an appropriate marginal tax rate as provided in § 302-17.8(e)(2)(ii).
3 If two or more marginal tax rates of a State overlap an income bracket shown in this table, then the highest of the two or more State marginal tax rates is shown for that entire income bracket. For more specific information, see the 2007 State Tax Handbook, pp. 255-270, CCH, Inc., http://tax.cchgroup.com/​Books/​default.
4 This is an estimate. For earnings over $100,000, and for filing statuses other than those above, please consult actual tax tables. See 2007 State Tax Handbook, pp. 255-270, CCH, Inc., http://tax.cchgroup.com/​Books/​default.
5 This rate applies only to those individuals certifying that they will file under a single or married filing separately status within the states where they will pay income taxes.
6 The income tax rate for Rhode Island is 25 percent of Federal income tax rates, including capital gains rates and any another other special rates for other types of income. Rates shown as a percent of Federal income tax liability must be converted to a percent of income as provided in § 302-17.8(e)(2)(iii). Effective for the 2006 tax year, tax payers may elect to compute income tax liability based on a graduated rate schedule or an alternative flat tax equal to 8%.
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Appendix C to Part 302-17—Federal Tax Tables for RIT Allowance—Year 2

Estimated Ranges of Wage and Salary Income Corresponding to Federal Statutory Marginal Income Tax Rates by Filing Status In 2007

[The following table is to be used to determine the Federal marginal tax rate for Year 2 for computation of the RIT allowance as prescribed in § 302-17.8(e)(1). This table is to be used for employees whose Year 1 occurred during calendar years 1997, 1998, 1999, 2000, 2001, 2002, 2003, 2004, 2005, or 2006]

Marginal tax rateSingle taxpayerHead of householdMarried filing jointly/qualifying widows & widowersMarried filing separately
PercentOverBut not overOverBut not overOverBut not overOverBut not over
10$9,287$17,545$18,060$29,399$26,173$41,393$14,049$21,441
1517,54543,39429,39962,57641,39391,20121,44145,388
2543,39493,10162,576138,85691,201162,11745,38881,616
2893,101183,867138,856216,022162,117233,65681,616119,660
33183,867376,616216,022389,045233,656387,765119,660197,483
35376,616389,045387,765197,483
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Appendix D to Part 302-17—Puerto Rico Tax Tables for RIT Allowance

Puerto Rico Marginal Tax Rates by Earned Income Level—Tax Year 2006

[Use the following table to compute the RIT allowance for Puerto Rico taxes, as prescribed in § 302-17.8(e)(4)(i), on taxable reimbursements received during calendar year 2006.]

Marginal tax rateFor married person living with spouse and filing jointly, married person not living with spouse, single person, or head of householdFor married person living with spouse and filing separately
OverBut not overOverBut not over
10$2,000$17,000$1,000$8,500
1517,00030,0008,50015,000
2830,00050,00015,00025,000
3350,00025,000
Source: Individual Income Tax Return 2006—Long Form; Commonwealth of Puerto Rico, Department of the Treasury, P.O. Box 9022501, San Juan, PR 00902-2501; http://www.hacienda.gobierno.pr/​planillas_​y_​formularios/​formularios.html.
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[FR Doc. E7-6729 Filed 4-6-07; 8:45 am]

BILLING CODE 6820-14-P