[Federal Register Volume 71, Number 36 (Thursday, February 23, 2006)]
[Rules and Regulations]
[Pages 9262-9265]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-1677]


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GENERAL SERVICES ADMINISTRATION

41 CFR Part 302-17

[FTR Amendment 2006-01; FTR Case 2006-301]
RIN 3090-AI22


Federal Travel Regulation; Relocation Income Tax (RIT) Allowance 
Tax Tables--2006 Update

AGENCY: Office of Governmentwide Policy, GSA.

ACTION: Final rule.

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SUMMARY: The Federal, State, and Puerto Rico tax tables for calculating 
the relocation income tax (RIT) allowance are being updated 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 calculating the 2006 RIT allowance to be paid to 
relocating Federal employees.

DATES: Effective Date: This final rule was effective on January 1, 
2006.

FOR FURTHER INFORMATION CONTACT: The Regulatory Secretariat (VIR), Room 
4035, GSA Building, Washington, DC 20405, telephone (202) 208-7312, for 
information pertaining to status or publication schedules. For 
clarification of content, contact Patrick McConnell, Office of 
Governmentwide Policy, Travel Management Policy (MTT), Washington, DC 
20405, telephone (202) 501-2362. Please cite FTR Amendment 2006-01, FTR 
case 2006-301.

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

[[Page 9263]]

payment of the RIT allowance are contained in the Federal Travel 
Regulation (41 CFR Part 302-17). The Federal, State, and Puerto Rico 
tax tables for calculating RIT allowance payments are updated yearly to 
reflect changes in Federal, State, and Puerto Rico income tax brackets 
and rates.
    This amendment provides the tax tables necessary to compute the RIT 
allowance for employees who are taxed in 2005 on moving expense 
reimbursements.

B. Executive Order 12866

    The General Services Administration (GSA) has determined that this 
final rule is not a significant regulatory action for the purposes of 
Executive Order 12866 of September 30, 1993.

C. Regulatory Flexibility Act

    This final rule is not required to be published in the Federal 
Register for notice and comment; 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.

List of Subjects in 41 CFR Part 302-17

    Government employees, Income taxes, Relocation allowances and 
entitlements, Transfers, Travel and transportation expenses.

    Dated: February 9, 2006.
David L. Bibb,
Acting Administrator of General Services.

0
For the reasons set forth in the preamble, under 5 U.S.C. 5738, GSA 
amends 41 CFR part 302-17 as set forth below:

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

0
1. The authority citation for 41 CFR part 302-17 continues to read as 
follows:

    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.


0
2. Revise Appendixes A, B, C, and D to Part 302-17 to read as follows:

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 2005
   [The following table is to be used to determine the Federal marginal tax rate for Year 1 for computation of the RIT allowance as prescribed in Sec.
                    302-17.8(e)(1). This table is to be used for employees in which their Year 1 occurred during calendar year 2005.]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                Marginal tax rate                      Single taxpayer          Head of household      Married filing jointly/       Married filing
-----------------------------------------------------------------------------------------------------    qualifying widows &           separately
                                                                                                              widowers         -------------------------
                                                                 But not                   But not   --------------------------
                     Percent                          Over         over         Over         over                    But not        Over       But not
                                                                                                          Over         over                      over
--------------------------------------------------------------------------------------------------------------------------------------------------------
10..............................................       $8,712      $16,201      $15,989      $26,630      $23,519      $37,568      $10,897      $18,242
15..............................................       16,201       39,898       26,630       58,079       37,568       84,110       18,242       42,410
25..............................................       39,898       85,748       58,079      125,252       84,110      150,301       42,410       76,165
28..............................................       85,748      169,230      125,252      195,589      150,301      216,710       76,165      109,970
33..............................................      169,230      348,318      195,589      360,009      216,710      360,571      109,970      182,419
35..............................................      348,318  ...........      360,009  ...........      360,571  ...........      182,419  ...........
--------------------------------------------------------------------------------------------------------------------------------------------------------

Appendix B to Part 302-17--State Tax Tables for RIT Allowance

                         State Marginal Tax Rates by Earned Income Level--Tax Year 2005
     [The following table is to be used to determine the State marginal tax rates for calculation of the RIT
allowance as prescribed in Sec.   302-17.8(e)(2). This table is to be used as a guide for employees who received
 covered taxable reimbursements during calendar year 2005. The rates shown below are for married filing jointly
 and if the state has a specific single rate, it is shown. For more specific information or if an employee is in
        a different filing status, please see the 2006 State Tax Handbook, pp. 258-274, CCH Inc., http://tax.cchgroup.com/Books/default.]
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   Marginal tax rates (stated in percents) for the earned income amounts specified in each column.\1\ \2\ \3\
-----------------------------------------------------------------------------------------------------------------
                                                                                                 $75,000 & over
         State (or District)            $20,000-24,999     $25,000-49,999     $50,000-74,999          \4\
----------------------------------------------------------------------------------------------------------------
Alabama.............................               5.00               5.00               5.00               5.00
Alaska..............................               0.00               0.00               0.00               0.00
Arizona.............................               3.20               3.20               3.74               3.74
    If single status, married filing               3.20               3.74               4.72               4.72
     separately \5\.................
Arkansas............................               6.00               7.00               7.00               7.00
California..........................               2.00               6.00               8.00               9.30
    If single status, married filing               6.00               9.30               9.30               9.30
     separately \5\.................
Colorado............................               4.63               4.63               4.63               4.63
Connecticut.........................               5.00               5.00               5.00               5.00
Delaware............................               5.20               5.55               5.95               5.95
District of Columbia................               7.50               9.00               9.00               9.00
Florida.............................               0.00               0.00               0.00               0.00
Georgia.............................               6.00               6.00               6.00               6.00
Hawaii..............................               6.80               7.60               7.90               8.25
    If single status, married filing               7.60               7.90               8.25               8.25
     separately \5\.................

[[Page 9264]]

 
Idaho...............................               7.40               7.80               7.80               7.80
    If single status, married filing               7.80               7.80               7.80               7.80
     separately \5\.................
Illinois............................               3.00               3.00               3.00               3.00
Indiana.............................               3.40               3.40               3.40               3.40
Iowa................................               6.48               7.92               8.98               8.98
Kansas..............................               3.50               6.25               6.45               6.45
    If single status, married filing               6.25               6.45               6.45               6.45
     separately \5\.................
Kentucky............................               5.80               5.80               5.80               6.00
Louisiana...........................               2.00               4.00               6.00               6.00
    If single status, married filing               4.00               6.00               6.00               6.00
     separately \5\.................
Maine...............................               7.00               8.50               8.50               8.50
    If single status, married filing               8.50               8.50               8.50               8.50
     separately \5\.................
Maryland............................               4.75               4.75               4.75               4.75
Massachusetts.......................               5.30               5.30               5.30               5.30
Michigan............................               3.90               3.90               3.90               3.90
Minnesota...........................               5.35               7.05               7.05               7.05
    If single status, married filing               7.05               7.05               7.85               7.85
     separately \5\.................
Mississippi.........................               5.00               5.00               5.00               5.00
Missouri............................               6.00               6.00               6.00               6.00
Montana.............................               6.90               6.90               6.90               6.90
Nebraska............................               3.57               6.84               6.84               6.84
    If single status, married filing               5.12               6.84               6.84               6.84
     separately \5\.................
Nevada..............................               0.00               0.00               0.00               0.00
New Hampshire.......................               0.00               0.00               0.00               0.00
New Jersey..........................               1.75               1.75               3.50              5.525
    If single status, married filing               1.75              5.525              5.525              6.370
     separately \5\.................
New Mexico..........................               6.00               6.00               6.00               6.00
New York............................               5.25               6.85               6.85               6.85
    If single status, married filing               6.85               6.85               6.85               6.85
     separately \5\.................
North Carolina......................               7.00               7.00               7.00               7.00
    If single status, married filing               7.00               7.00               7.75               7.75
     separately \5\.................
North Dakota........................               2.10               2.10               3.92               3.92
    If single status, married filing               2.10               3.92               4.34               4.34
     separately \5\.................
Ohio................................               4.27              4.983              4.983              5.693
Oklahoma \6\........................               6.65               6.65               6.65               6.65
Oregon..............................               9.00               9.00               9.00               9.00
Pennsylvania........................               3.07               3.07               3.07               3.07
Rhode Island \7\....................              25.00              25.00              25.00              25.00
South Carolina......................               7.00               7.00               7.00               7.00
South Dakota........................               0.00               0.00               0.00               0.00
Tennessee...........................               0.00               0.00               0.00               0.00
Texas...............................               0.00               0.00               0.00               0.00
Utah................................               7.00               7.00               7.00               7.00
Vermont.............................               3.60               3.60               7.20               7.20
    If single status, married filing               3.60               7.20               8.50               8.50
     separately \5\.................
Virginia............................               5.75               5.75               5.75               5.75
Washington..........................               0.00               0.00               0.00               0.00
West Virginia.......................               4.00               6.00               6.50               6.50
Wisconsin...........................               6.50               6.50               6.50               6.50
Wyoming.............................               0.00               0.00               0.00              0.00
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(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 Sec.   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 2006 State Tax Handbook, pp. 258-274, 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 2006 State Tax Handbook, pp. 258-274, CCH, Inc., http://tax.cchgroup.com/Books/default 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 2005 personal income tax rates shown here for Oklahoma follow Method 1 only. For information on Method
  2, see the 2006 State Tax Handbook, pp. 258-274, CCH, Inc., http://tax.cchgroup.com/Books/default.
\7\ 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 Sec.   302-17.8(e)(2)(iii).


[[Page 9265]]

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 2006
   [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 Sec.
 302-17.8(e)(1). This table is to be used for employees whose Year 1 occurred during calendar years 1996, 1997, 1998, 1999, 2000, 2001, 2002, 2003, 2004
                                                                        or 2005.]
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                Marginal tax rate                      Single taxpayer          Head of household      Married filing jointly/       Married filing
-----------------------------------------------------------------------------------------------------    qualifying widows &           separately
                                                                                                              widowers         -------------------------
                                                                 But not                   But not   --------------------------
                     Percent                          Over         over         Over         over                    But not        Over       But not
                                                                                                          Over         over                      over
--------------------------------------------------------------------------------------------------------------------------------------------------------
10..............................................       $8,739      $16,560      $16,538      $27,374      $24,163      $38,534      $12,036      $19,194
15..............................................       16,560       41,041       27,374       59,526       38,534       86,182       19,194       43,330
25..............................................       41,041       88,541       59,526      128,605       86,182      154,786       43,330       79,441
28..............................................       88,541      175,222      128,605      203,511      154,786      224,818       79,441      114,716
33..............................................      175,222      360,212      203,511      375,305      224,818      374,173      114,716      188,184
35..............................................      360,212  ...........      375,305  ...........      374,173  ...........      188,184  ...........
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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 2005
  [The following table is to be used to determine the Puerto Rico marginal tax rate for computation of the RIT
                              allowance as prescribed in Sec.   302-17.8(e)(4)(i).]
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                      Marginal tax rate                          For married person        For married person
-------------------------------------------------------------  living with spouse and    living with spouse and
                                                              filing  jointly, married      filing separately
                                                               person not living with  -------------------------
                                                               spouse, single person,
                           Percent                              or head of household
                                                             --------------------------     Over       But not
                                                                             But not                     over
                                                                  Over         over
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10..........................................................       $2,000      $17,000       $1,000       $8,500
15..........................................................       17,000       30,000        8,500       15,000
28..........................................................       30,000       50,000       15,000       25,000
33..........................................................       50,000  ...........       25,000  ...........
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Source: Individual Income Tax Return 2005--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_individuo.asp.

[FR Doc. 06-1677 Filed 2-22-06; 8:45 am]
BILLING CODE 6820-14-P