No tax on tips? Tax deduction for gambling losses? NC lawmakers return with new ideas
North Carolina lawmakers kicked off the year’s legislative session on Wednesday by filing a flurry of bills on topics ranging from gambling to taxes to balloons.
Votes aren’t expected for several weeks as the General Assembly restarts its business, but the initial rush of bills can give some insight into what issues may dominate the session.
Here are a few notable bills filed Wednesday worth keeping an eye on.
HB 14: Income tax deduction for gambling losses
Rep. Erin Paré, a Holly Springs Republican who was recently appointed a chair of the House Appropriations Committee, filed this bill to allow for a state income tax deduction for gambling losses.
The bill would allow North Carolinians choosing the itemized deduction to deduct wagering losses from their taxable income, as allowed under Section 165(d) of the Internal Revenue Code.
The federal tax code allows deduction of gambling losses if individuals itemize their deductions and keep a record of their winnings and losses, according to the IRS. The amount of losses being deducted can’t exceed the amount of gambling income that is reported on a tax return.
Paré said in a social media post Wednesday that the bill is intended to conform North Carolina law to federal law, and “prevent confusion and surprise tax bills.”
She said that most of the states that have legalized sports betting, as North Carolina has, “allow this deduction capped at winnings.”
HB 11: No tax on tips
A proposal to ban taxation on tips introduced by Republicans in the state House echoes ideas pushed by President Donald Trump, who during his campaign promised to eliminate federal income taxes on tips and continues to push for the change.
The bill would allow taxpayers to claim a state income tax deduction for overtime pay, for up to $2,500 in bonus pay, and for any reported tips.
A deduction is an amount subtracted from taxable income, reducing the amount of tax owed.
The bill, sponsored by Joint Caucus Leader Harry Warren and Rules Chairman John Bell, would apply starting with 2025 taxes.
SB 14: Repealing NC’s literacy test requirement
Several Republican senators revived a longstanding effort to remove the state’s Jim Crow-era literacy test requirement from the North Carolina Constitution.
The requirement has been inoperable since the passage of the Voting Rights Act in 1965, but has remained in the constitution as a relic of the state’s racist history.
If passed, the bill would allow voters in the 2026 midterms to decide whether the constitution should be amended to remove the requirement.
Lawmakers have pushed for a such an amendment for years, but it hasn’t made it on the ballot since 1970 — when voters rejected it.
HB 5: Removing permit requirement for concealed carry
Rep. Keith Kidwell, the head of the House Freedom Caucus, has introduced this bill in past sessions to allow anyone over the age of 18 to carry a concealed handgun without first obtaining a permit from their local sheriff’s office.
The bill would make it lawful to carry a concealed handgun without obtaining the permit, but would continue to make concealed handgun permits available to anyone who wants to obtain one “for the purpose of reciprocity when traveling in another state, to make the purchase of a firearm more efficient, or for various other reasons.”
A similar bill filed by Kidwell in 2023 was on track to advance through the House as it quickly cleared a pair of committees in the days before a key deadline, but ultimately stalled.
SB 20: Prohibiting mass balloon releases
A bill filed by Republican Sen. Bobby Hanig would ban most mass balloon releases, finding that the practice “poses a harm to the scenic beauty of the State and a danger and nuisance to wildlife and marine animals.”
In addition to potentially harming animals, balloons can get tangled in power lines and cause outages.
If the bill is passed, mass balloon releases would become an infraction punishable by a fine of $250.
The bill includes exceptions for hot air balloons as well as balloons used for scientific or meteorological purposes.
HB 12: Observing standard time year-round
A bill filed by Warren and Bell would require the state to observe standard time year-round, aligning with Trump’s views.
The debate on which time zone to observe has raged for years, and Trump has also called for an end to daylight savings time, calling it “inconvenient” and “very costly.”
The standard time bill calls for North Carolina to observe standard time year-round starting March 8, 2026. Standard time is the time currently in effect, with earlier nightfall and more morning daylight.
Standard time ends this year on March 9, when daylight saving time begins, meaning people move their clocks ahead and lose an hour of sleep. The shift also results in later sunrises and sunsets.
A High Point University poll conducted in 2023 found that among 1,000 North Carolina respondents, just under 50% preferred switching to year-round daylight saving time, while 21% favored year-round standard time and 25% preferred keeping the current system of switching between the two. Another 13% were unsure.
HB 2: Entry fees for high school athletic events
Another bill would require that cash be accepted as a form of payment for admission to North Carolina high school athletic events.
A similar bill was passed in both chambers last session but stalled when the House didn’t adopt the Senate’s additions. Rep. Reece Pyrtle, a Rockingham County Republican, has said the bill is needed because some high schools switched to electronic-only payment methods during the pandemic.
Pyrtle’s bill also would require free admission to high school athletic events for senior citizens who show a Tar Heel Card issued by the state Department of Health and Human Services. If approved, the bill would go into effect next school year.
HB 20: Fair Maps Act
Democrats, including Rep. Pricey Harrison of Greensboro, filed a bill Wednesday to reform the state’s redistricting process.
The bill calls for amending the North Carolina Constitution by adding a new section establishing an independent redistricting process and creating a redistricting commission.
Currently, state lawmakers are responsible for drawing congressional and General Assembly districts every 10 years after each census.
Under the proposed independent redistricting process, neither voters nor lawmakers would have a role in revising electoral districts.
Instead, what the bill calls a “citizens” redistricting commission would draw the maps. Members of this commission could not be public officeholders, legislative staffers, lobbyists, or individuals with other political ties, among other caveats.
Since Republicans control both chambers of the legislature, they have led the redistricting process over the last decade, typically drawing maps that favor their party. These maps have prompted frequent lawsuits and several federal cases remain ongoing in which voters claim the districts amount to racial gerrymandering.
Democrats also expected to push for transparency measures
Harrison said she and other House Democrats are working on an omnibus “restore public confidence in government” bill that would address transparency issues reported in The News & Observer’s Power & Secrecy series and in other media reports.
Provisions would include restoring the public’s access to legislators’ records, more transparency as bills move through the legislature and repeal of a change in campaign finance law last year that could make it harder for the public to see the source of campaign contributions.
The bill would likely have little chance of passing the Republican-controlled General Assembly, where the GOP holds sizable majorities in both chambers.
This story was originally published January 29, 2025 at 2:58 PM.
