ADMINISTRATIVE NOTICE 95-16



SUBJECT:	PERSONAL INCOME TAX -- Meaning of "federal adjusted gross income" and certain other terms updated for taxable years beginning after December 31, 1993, bringing them into conformity with their meanings for federal income tax purposes.

	On February 15, 1995, Governor Gaston Caperton signed into law Senate Bill No. 172, which updates the meaning of certain terms used in the West Virginia Personal Income Act.  This bill was passed by the Legislature on February 6, 1995, and is effective from passage.

	The West Virginia Personal Income Tax Act uses "federal adjusted gross income" as the starting point when determining a person's West Virginia personal income tax liability.  Certain other terms used in the West Virginia Personal Income Tax Act are also defined by incorporating federal income tax definitions.  West Virginia does not, however, automatically adopt changes in federal definitions.  Prior law adopted changes in federal definitions made before January 1, 1994.

	Senate Bill No. 172 adopts changes in federal definitions made prior to January 1, 1995, for taxable years beginning after December 31, 1993.  This means that the amount reported as federal adjusted gross income on an individual's 1994 federal income tax return (Federal Form 1040, etc.) must be entered on that individual's 1994 West Virginia personal income tax return (Form IT-140, IT­140NR/PY).  Definitions are also updated for estates and trusts.





Issued February 21, 1995 				James H. Paige III
							Secretary
							Department of Tax and Revenue

REMINDER!  WATCH FOR THE RESPONSE/TELEPHONE INFORMATION NUMBER GIVEN!!! 
Department of Tax and Revenue				Operator on Duty 8:30 am - 4:00 pm
Taxpayer Services Division					Monday through Friday
P. O. Box 3784						Telephones:  (304) 558-3333 or
Charleston, WV  25337-3784				1-800-982-8297 (within W. Va. only)
							Telescopier:  (304) 558-3269
							TDD Service for the hearing impaired
								1-800-282-9733