A last look at ballot initiatives

A few months ago, I blogged about ballot initiatives that some voters will face when they go to the polls this election.

Most of the questions deal with social or environmental issues, but a few tax measures are still coming up for public "nay" or "yea." Here's an update, in no particular order because it's been that kind of day!

Massachusetts
The tax vote being watched the most closely is in Massachusetts. Residents there have a chance to erase their "Taxachusetts" nickname by voting to eliminate the state's income tax, which raises $12.5 billion a year or 40 percent of the state's budget.

Even if Question Number 1 is approved, it won't immediately eliminate taxes. Rather, the Bay State's 5.3 percent income tax rate would be cut to 2.65 percent on Jan. 1, 2009, and then disappear entirely by 2010.

Abolishing the tax, argue Question Number 1 supporters, would save the average taxpayer $3,600 a year. Six years ago, a similar measure won 45 percent of the vote.

Florida
Amendment 8 will ask Sunshine State voters to allow local sales tax collection for community colleges.

This tax vote is penny ante, however, compared to what many Floridians had hoped they would see on the Nov. 4 ballot. Anti-property tax advocates tried to get a ballot initiative on the slate that would let voters decide if they want to pay higher sales taxes in exchange for lower property taxes. 

That "tax swap" measure was ordered off the ballot by a circuit court judge who ruled that the wording was misleading.

Nevada
Silver State voters also find themselves looking at a relatively innocuous sales tax ballot measures. Question 3 requires certain legislative findings before sales taxes are allowed and Question 4 allows the legislature to change sales taxes without voter approval.

Earlier this year, a group had tried to get a California-style Proposition 13 measure on the November ballot. But a ruling in September by the Nevada Supreme Court was the death blow, at least this year, to the effort to get voter approval of a cap on property tax increases.

Colorado
Rocky Mountain State residents will vote on whether the state sales and use tax rate should be raised by 2 cents over a two-year period starting next July 1. Once it is completely phased in by 2010, the sales tax rate would be 3.1 percent. Revenue would go toward programs for people with developmental disabilities.

This state issue has gotten some national attention. On the campaign trail, Alaska governor and GOP vice presidential nominee Sarah Palin, the mother of a son with Down Syndrome, has spoken out against this measure.

North Dakota
Voters in this northern prairie state are being asked to cut their income tax by 50 percent and the corporate tax by 15 percent. The reduction is possible in large part because of a revenue surplus from a tax on oil drilling.

Maine
Down East voters are being asked whether they want to repeal a 2008 law that increased excise taxes on beer, wine and soda.

Missouri
Voters in the Show Me State will decide on an increase in the state's casino tax to 21 percent.

Oklahoma
Sooners are being asked to approve an amendment that would require a person or a business to file an application before receiving a tax exemption.

Oregon
A Beaver State measure, if approved, would allow unlimited deductions for federal income taxes on state income tax returns.

Georgia
Amendment 1, if approved, would mean lower taxes for Peach State landowners who conserve forest land.

Minnesota
If voters approve a legislative constitutional amendment, 3/8 of one percent would be added to the state's sales tax to fund clean water, natural areas, parks and the arts.

If I missed any tax ballot measure in your state, let me know and I'll update this list.

You also can peruse these and other initiatives in the Ballotwatch publication updated on Oct. 15. MarketWatch also has compiled a roundup of state initiatives. And Ballotpedia has a clickable map so you double check what's on your ballot.

Tax aspects of social issues: One of those social issues getting a lot of attention is California's Proposition 8. This constitutional amendment would ban same-sex marriage, which the state's high court OK'd earlier this year.

In the wake of the court's ruling, California's Franchise Tax Board issued a notice explaining the state personal income tax treatment and tax return filing obligations of same-sex married couples.

For affected Golden State filers, it's going to mean extra work at tax time.

Thanks to the court's decision, the California Revenue and Tax Code now construes the term "spouse" to include every individual who is legally married under California law, including same-sex married individuals. Consequently, individuals who are married by the last day of the taxable year are required to file either a joint return or married, filing separately return with the state.

However, since same-sex married couples are still required to file their federal tax returns using single filing status, they may be required to recompute deductions claimed on the state tax return.  Frequently, say state tax officials, this will mean each individual will have to add his or her adjusted gross income from the federal return to compute the couple's combined AGI.

In addition, warn California tax officials, the filing of a joint return may affect a same-sex married couple's qualification for the estimated tax safe harbor provision that enables taxpayers to avoid underpayment penalties.

Ah, yes, the tax price of love.

More details are available in California Franchise Tax Board Notice 2008-5.

Connecticut, too: The Nutmeg State became the latest state to allow same sex marriages and its officials also made a determination on how that affects these couples' tax-filing duties.

"In light of the Connecticut Supreme Court's recent decision in Kerrigan v. Commissioner of Public Health, which held that same-sex couples have the right under the state constitution to marry and must be accorded all the rights and benefits of marriage under state law, Conn. Gen. Stat. §46b-38pp must be construed to accord parties to a same-sex marriage the same tax treatment as parties to civil unions or other marriages," states Opinion No. 2008-018 issued on Oct. 28.

What that legal gobbledygook means is taxpayers in a same-sex marriage may file joint Connecticut state income tax returns.