DRS: IP 92(3.4), Personal Taxes

 

STATE OF CONNECTICUT
DEPARTMENT OF REVENUE SERVICES

450 Columbus Blvd
Hartford CT 06103

This Informational Publication has been modified and superseded by IP 92(3.5)

IP 92(3.4)

Personal Taxes


INTRODUCTION: This publication is intended as a general guide to Connecticut taxes for individuals. While it does not answer every question about Connecticut taxes, it will provide answers to some of the most common inquiries.

Please contact the Department's Taxpayer Services Division if you have additional questions.


INCOME TAX: There is a Connecticut income tax for Connecticut residents and for nonresidents who have income from Connecticut sources (including trusts and estates). Income that is taxable for federal purposes is, in general, also taxable for Connecticut income tax purposes. For taxable years beginning on or after January 1, 1997, the Connecticut income tax rate is 3% of Connecticut taxable income less than or equal to $4,500 (single and married filing separate), $7,000 (head of household), or $9,000 (married, filing jointly or qualifying widow(er)). Connecticut taxable income in excess of these amounts is taxed at 4.5%.

To compute your Connecticut taxable income, subtract your Connecticut personal exemption from your Connecticut adjusted gross income.

Maximum personal exemption levels are:

  • $12,000 - single filers (or married filing separately) with adjusted gross income up to $24,000.
  • $19,000 - head of household with adjusted gross income up to $38,000.
  • $24,000 - married filing jointly with adjusted gross income up to $48,000.

Exemptions are reduced by $1,000 for every additional $1,000 of adjusted gross income. Tax credits from 1% to 75% may also be available, depending upon income level. For taxable years beginning on or after January 1, 1996, residents who paid property taxes on their primary residence or privately owned motor vehicles to a Connecticut political subdivision will be allowed a tax credit of not more than $100 against their Connecticut income tax liability.

Employers will withhold tax from the wages of residents and of nonresidents who work in Connecticut. Those who expect to owe for the year more than $200 in Connecticut income tax, in addition to Connecticut income tax withheld from wages or pension income, should make estimated income tax payments.

Connecticut estimated payments are due at the same time as federal estimated payments:

  • April 15
  • June 15
  • September 15
  • January 15

The tax return is due on or before April 15 for the preceding calendar year.


ALTERNATIVE MINIMUM TAX: The Connecticut alternative minimum tax is a tax imposed on certain individuals, estates and trusts in addition to the regular Connecticut income tax. Taxpayers who are subject to and required to pay the federal alternative minimum tax are subject to the Connecticut alternative minimum tax. The Connecticut alternative minimum tax is the lesser of:

  • 19% of your adjusted federal alternative minimum tax or
  • 5% of the adjusted federal alternative minimum taxable income.

The tax must be reported on Form CT-6251, Connecticut Alternative Minimum Tax Return - Individual.


SUCCESSION TAX: The Connecticut succession tax is being phased out beginning in 1997 and is scheduled for total repeal effective in 2005. For a Connecticut resident, the tax applies to all property, except for real property and tangible personal property which is located outside Connecticut. For nonresidents, it applies only to real property and tangible personal property located in Connecticut. The tax rate depends on the relationship of the beneficiary to the decedent and the size of the estate. There is a total exemption from tax if the entire estate passes to a surviving spouse. For information and tax tables applicable to estates of decedents dying during 1997 and thereafter, request SN 95(18), 1995 Legislative Changes Affecting the Succession and Transfer Taxes and the Estate Tax, from the DRS Forms Unit.


ESTATE TAX: There is a "sponge" tax applied to estates. The tax is that amount by which the federal credit allowed for state death taxes exceeds the total death taxes actually paid to all states. It is applicable only to very large estates, usually in excess of $3 million.


GIFT TAX: Gifts by resident and nonresident individual donors are subject to the Connecticut gift tax. Residents are taxed on all gifts of intangible property and of real property and tangible personal property situated in Connecticut.

Gifts made to any particular donee are not subject to the Connecticut gift tax unless the value of all such gifts to such donee during the calendar year exceeds $10,000. The tax is reported on and paid upon the filing of Form CT-709, Connecticut Gift Tax Return. The return must be filed and the gift tax paid on or before April 15 annually for gifts made during the preceding calendar year.


PROPERTY TAX: Real estate and personal property are subject to this tax, with some statutory exemptions. It is levied by communities to fund local government. Neither the state nor its counties levy a property tax. For further information contact the assessor in the city or town where the property will be located or write to the Intergovernmental Policy Division, Office of Policy and Management, 450 Capitol Avenue, Mail Stop 54 FOR, P.O. Box 341441, Hartford, CT 06134-1441.

All property is assessed at 70% of value at the time of the last municipal revaluation, except for motor vehicles which are assessed at 70% of average retail value and personal property is assessed at 70% of the current market value.

October 1 is the assessment date for all municipalities. All owners of personal property, other than registered motor vehicles, must file a declaration with the assessor on or before November 1.

Property tax relief is available to persons who have reached the age of 65, provided they meet certain residence and income requirements. There is no age requirement for those who are 100% disabled. Application for this relief must be made at the local assessor's office.


REAL ESTATE CONVEYANCE TAX: There is a municipal conveyance tax imposed on deeds conveying real estate. The tax rate is eleven one-hundredths of one percent of the consideration received for the real property.

There is also a state conveyance tax imposed on deeds conveying real estate. The tax rate on the consideration received for the real estate is as follows:

Type of real estate                                                                  Rate

Unimproved land                                                        0.5%

Residential property (other than residential dwelling)        0.5%

Nonresidential property (other than unimproved land)      1.0%

Residential dwelling
    - Portion not exceeding $800,000                                0.5%

Residential dwelling
    - Portion exceeding $800,000                                     1.0%

Property conveyed by a delinquent mortgagor*
(if mortgage payments are more than six months
delinquent conveyed to a financial institution)                   0.5%

The state and municipal taxes are paid by those conveying the property. The grantor/seller must present a separate check to the Town Clerk, payable to the Commissioner of Revenue Services, in payment of the state tax when recording the deed. There are certain exemptions, including an exemption for deeds where the consideration received is less than $2,000. The taxes must be paid by the seller before the deed can be recorded.


SALES AND USE TAXES: There is a 6% tax on the sale or rental of most goods and certain services. However, there are exemptions: food; purchases made with food stamps; real property rentals; utility charges for residential property; household fuel; prescription drugs; certain non-prescription drugs; clothing under $50, materials for noncommercial sewing used to make clothing; newspaper and magazine subscriptions.

When sales tax is not collected by the seller of goods or provider of taxable services, a use tax is required. An individual must file a use tax return annually to report purchases of goods or services on which Connecticut sales tax was not paid. Typically, individuals who purchased goods from mail order or catalog companies and had the goods shipped to Connecticut and individuals who purchased goods at out-of-state locations and brought those goods back into Connecticut, are subject to Connecticut use tax if they did not pay Connecticut sales tax. The tax must be paid on or before April 15 for purchases made during the prior calendar year and may be reported on the Connecticut income tax return. Use tax may also be reported on Form OP-186, Connecticut Individual Use Tax Return.

A room occupancy tax of 12% applies to the rental of rooms in a hotel or lodging house for 30 consecutive days or less.


MOTOR FUEL TAX: There is a state tax on all motor fuel used to propel highway vehicles. This tax is included in the per gallon purchase price as calculated at the metered pump. It is subject to change.


MOTOR VEHICLE FEES: There is a two year registration fee of $70 for passenger cars. Upon renewal, there is an additional $4 Clean Air Act fee for all classes of motor vehicles. Operator licenses are issued every four years for $35.50. For general information, contact the Connecticut Department of Motor Vehicles at 1-800-842-8222.


BOAT REGISTRATION FEES: There is an annual registration fee for boats in lieu of a local property tax. For information, contact the Department of Motor Vehicles at 1-800-842-8222.


ALCOHOLIC BEVERAGE AND CIGARETTE TAXES: Alcoholic beverage taxes are assessed as follows:

per wine gallon:

distilled liquor                                 $4.50
fortified and sparkling wines              $1.50
still wines                                      $  .60 
beer                                             $  .20
liquor coolers                                  $2.05

The cigarette tax is 50 cents per pack of 20. Cigarettes are also subject to the 6% sales and use taxes. The tobacco products tax (excluding cigarettes) is 20% of the wholesale price.

 


ADMISSIONS, DUES AND CABARET TAX: A 10% tax is levied on dues and initiation fees of a social, athletic, or sporting club, which is either owned or operated by its members. A club shall be exempt from the dues tax if the annual dues of every member and any initiation fee are each $100 or less.

A 10% admissions tax applies to admission charges of $1 or more to places of amusement, entertainment or recreation. However, any production featuring live entertainment by actors or musicians at non-profit theaters and playhouses exempt under 501 of the Internal Revenue Code is exempt from the tax. Also, exempt from the tax are admission charges of $1.99 or less to motion picture shows and admission charges to carnivals and to amusement rides. A 5% cabaret tax generally applies to charges for food, drink, admissions, or merchandise where music, entertainment or dancing privileges are furnished in conjunction with the sale or serving of alcoholic beverages for profit.


RELATED FORMS AND PUBLICATIONS: You may request:

IP 91(1.4) Connecticut Income Tax Information for Senior Citizens
IP 92(4.3) State Tax Tips For Senior Citizens
IP 92(5.6) Estimated Income Taxes
IP 94(1) A Guide to the Federal and Connecticut Gift Taxes
IP 94(2.3) Q & A: The Connecticut Alternative Minimum Tax
SN 95(18) 1995 Legislative Changes Affecting the Succession and Transfer Taxes and Estate Tax
Form OP-186 Connecticut Individual Use Tax Return
Form CT-709 Connecticut Gift Tax Return


EFFECT OF THIS DOCUMENT: An Informational Publication (IP) is a document that addresses frequently-asked questions about a current Department position, policy or practice, usually in a less technical, question-and-answer format.


EFFECT ON OTHER DOCUMENTS: IP 92(3.3) is modified and superseded by IP 92(3.4). IP 92(3.3) may no longer be relied upon after the date of issuance of IP 92(3.4).


FORMS AND PUBLICATIONS: Forms and publications are available all day, seven days a week:

  • Internet: Preview and download forms and publications from the DRS Web site: http://www.ct.gov/drs
  • Telephone: Call 860-297-4753 (from anywhere), or 1-800-382-9463 (toll-free within Connecticut) and select Option 2 from a touch-tone phone.


IP 92(3.4)
Issued: 12/10/96
Replaces: IP 92(3.3) (Issued 1/3/95)