Georgia's Income Tax Glide Path Stops at 3.99%

Georgia taxes personal income at a flat 4.99% for tax year 2026, down from 5.19% in 2025. The law that set the new rate, House Bill 463, also schedules eight further cuts of 0.125 percentage points each, and the schedule ends at 3.99%. Zero appears nowhere in the enacted text. The elimination Georgia debated through the spring was a Senate committee recommendation, and it was never enacted.

The committee's plan

The Senate Special Committee on the Elimination of Georgia's Income Tax, created by Lt. Gov. Burt Jones in 2025, delivered its final report on January 7, 2026. Its first recommendation was a standard deduction of $50,000 for single filers and $100,000 for joint filers, effective January 1, 2027 — a change the committee costs at $3 billion in its first fiscal year and $6 billion in its second, and one it estimates would end income tax liability for two-thirds of Georgia filers. Its second recommendation was a staged rate path: 4.99% for 2026, then 3.99% for tax year 2029, then 0.00% by 2032, with each stage past 2026 left to future legislation that the report says should carry its own revenue triggers.

The Senate passed two bills built on that report on February 12, 2026, each described by the Lieutenant Governor's office as independently "the largest financial return to Georgia taxpayers in history." One piece of the plan is now law: the 4.99% rate for 2026. The $50,000 deduction, the 2029 date, and the zero are not.

The law that passed

HB 463, the Georgia Economic Growth and Tax Relief Act of 2026, was signed on May 11, 2026, and applies to taxable years beginning on or after January 1, 2026, so a rate signed in May governs the whole year. Georgia has now done this three years running: HB 1015 set the 2024 rate at 5.39% and HB 111 set the 2025 rate at 5.19%, each enacted months into the year it governed.

The operative section, O.C.G.A. §48-7-20(a.1), reads as a schedule: 4.99% for 2026, then a 0.125-point reduction each January 1 from 2027 until the rate reaches 3.99%. The corporate rate appears nowhere in the bill because it does not need to: §48-7-21 has defined it as the individual rate since HB 1023 of 2024, so each step cuts both taxes. The committee had recommended holding the corporate rate at 4.99% and decoupling it; the enacted law keeps the tie.

Eight steps, three tests

If every step lands on schedule, §48-7-20(a.1) produces this:

Each figure is the statute's arithmetic (the prior year minus 0.125 points), and each is conditional. Section 48-7-20(a.1)(2) delays a step by one year for every year that any of three things is true on December 1: the Governor's revenue estimate for the coming fiscal year is less than 3% above the current one; the prior fiscal year's net collections failed to beat each of the three years before it; or the Revenue Shortfall Reserve holds less than the next cut is projected to cost. The standard-deduction increases carry the same condition under §48-7-27(a)(1.1), and a delayed deduction step delays the rate step with it.

The tests predate the bill. The Georgia Budget and Policy Institute notes that the same triggers have been in force since the 2022 Tax Reduction and Reform Act, and that they would have blocked the reduction prior law had scheduled for January 1, 2026. This year's cut happened because HB 463 wrote 4.99% into the statute unconditionally; every later step goes back through the tests that had just failed. GBPI puts the cost of the package, if every step lands, at more than $6.5 billion through 2034, about a third of Georgia's income tax revenue. In 2032, the year the committee's plan reached 0.00%, the enacted schedule reads 4.24%.

What changes on a 2026 return

The Department of Revenue lists the 2026 standard deduction at $15,000 for single filers, heads of household, and married filers filing separately, and $30,000 for joint filers, up from 2025's $12,000 and $24,000. From 2027 the single figure rises $375 a year toward a ceiling of $18,000, the joint figure $750 a year toward $36,000, and the per-dependent deduction (raised to $5,000 for 2026, from $4,000) $125 a year toward $6,000, all on the rate schedule's trigger terms.

For the $65,000 single filer, the arithmetic for tax year 2026 (the return filed in early 2027) reads: $65,000 − $15,000 = $50,000 of Georgia taxable income, and 4.99% of $50,000 is $2,495. Under the committee's $50,000 deduction, the same line would have read $65,000 − $50,000 = $15,000, and 4.99% of $15,000 is $748.50. The distance between the recommendation and the law is $1,746.50 a year for that one filer. A single filer under $15,000 now owes Georgia nothing; the committee would have moved that line to $50,000.

Two smaller pieces are dated and temporary. For tax years 2026 through 2028, up to $1,750 of cash tips and, for full-time hourly employees, $1,750 of qualified overtime under the federal §225 definition come out of Georgia taxable income; both paragraphs repeal themselves on December 31, 2028. From tax year 2027, the retirement-income exclusion for filers 65 and older rises from $65,000 to $70,000.

The neighbors' numbers

North Carolina's flat rate for 2026 is 3.99%, the same figure Georgia's schedule reaches in 2034 at the earliest. Florida's is 0.00% for 2026, held there by Article VII, §5(a) of its constitution rather than by statute. Georgia's own top rate has moved −0.76 points since tax year 2022, when its graduated schedule topped out at 5.75%; the flat 4.99% now applies from the first dollar of taxable income.

Data note

Georgia's 2026 figures are final in TaxMath's tables, verified against the enacted act and the Department of Revenue's published rate. The 2027–2034 figures above are statutory arithmetic, conditional on the December tests, and no revenue department has published them; they enter the tables year by year as each step clears or slips, and the live board is 2026 data status. An earlier version of this article described the committee's plan as enacted law; the correction is logged at /corrections.

The first conditional step is January 1, 2027, decided on December 1, 2026, when the three tests are read against the Governor's estimates, three years of collections, and the reserve balance. The 2026 rate requires no waiting: 4.99% is in force now, and the fleet ranking prices it for the $65,000 filer against all 51 US jurisdictions.

This article is for informational purposes only and does not constitute tax advice. Consult a qualified tax professional for guidance specific to your situation.