Utah return changes for 2025 and 2026

HB 106 lowered the individual, corporate and franchise rate from 4.55% to 4.5% for tax years beginning on or after January 1, 2025.

• Personal exemption: $2,111 per qualifying dependent, up from $2,046.
• Social security credit: now computed from state taxable income, with phase-outs at $54,000 single, $45,000 separate and $90,000 joint or head of household.
• Child tax credit: a qualifying child is now under six.
• New employer child care credits for construction and operating costs.

The Tax Commission says the federal senior, overtime, tips and car loan deductions have no effect on the Utah return because they are below the line. SALT itemized on the federal return carries through to Utah.

The January 2026 webinar said the elective PTE tax expires for tax years beginning after December 31, 2025 unless the legislature extends it. The Commission’s due-date calendar now lists a SALT election and payment deadline of December 31 for calendar 2026, so confirm the current status before advising a client.

From 2026, payment processors must send Utah the same 1099-K information they report to the IRS, and interest on amended returns accruing from January 1, 2026 is capped at $100 per calendar year.