Minnesota SF 2284: Unlimited Social Security subtraction provision

Bill Text

1.1 A bill for an act​
1.2 relating to taxation; individual income; providing an unlimited Social Security​
1.3 subtraction; amending Minnesota Statutes 2024, section 290.0132, subdivision​
1.4 26.​
1.5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:​
1.6 Section 1. Minnesota Statutes 2024, section 290.0132, subdivision 26, is amended to read:​
1.7 Subd. 26.Social Security benefits.(a) A taxpayer is allowed a subtraction equal to the​
1.8 greater of the simplified subtraction allowed under paragraph (b) or the alternate subtraction​
1.9 determined under paragraph (e).​
1.10 (b) A taxpayer's simplified subtraction equals the amount of taxable social security​
1.11 benefits, as reduced under paragraphs (c) and (d).​
1.12 (c) For a taxpayer other than a married taxpayer filing a separate return with adjusted​
1.13 gross income above the phaseout threshold, the simplified subtraction is reduced by ten​
1.14 percent for each $4,000 of adjusted gross income, or fraction thereof, in excess of the​
1.15 phaseout threshold. The phaseout threshold equals:​
1.16 (1) $100,000 for a married taxpayer filing a joint return or surviving spouse;​
1.17 (2) $78,000 for a single or head of household taxpayer; and​
1.18 (3) for a married taxpayer filing a separate return, half the amount for a married taxpayer​
1.19 filing a joint return.​
1.20 (d) For a married taxpayer filing a separate return, the simplified subtraction is reduced​
1.21 by ten percent for each $2,000 of adjusted gross income, or fraction thereof, in excess of​
1.22 the phaseout threshold.​
1​Section 1.​
25-02026 as introduced​01/24/25 REVISOR EAP/VJ​
SENATE​
STATE OF MINNESOTA​
S.F. No. 2284​NINETY-FOURTH SESSION​
(SENATE AUTHORS: LUCERO and Coleman)​
OFFICIAL STATUS​D-PG​DATE​
Introduction and first reading​672​03/06/2025​
Referred to Taxes​

2.1 (e) A taxpayer's alternate subtraction equals the lesser of taxable Social Security benefits​
2.2 or a maximum subtraction subject to the limits under paragraphs (f), (g), and (h).​
2.3 (f) For married taxpayers filing a joint return and surviving spouses, the maximum​
2.4 subtraction under paragraph (c) equals $5,840. The maximum subtraction is reduced by 20​
2.5 percent of provisional income over $88,630. In no case is the subtraction less than zero.​
2.6 (g) For single or head-of-household taxpayers, the maximum subtraction under paragraph​
2.7 (c) equals $4,560. The maximum subtraction is reduced by 20 percent of provisional income​
2.8 over $69,250. In no case is the subtraction less than zero.​
2.9 (h) For married taxpayers filing separate returns, the maximum subtraction under​
2.10 paragraph (c) equals one-half the maximum subtraction for joint returns under paragraph​
2.11 (f). The maximum subtraction is reduced by 20 percent of provisional income over one-half​
2.12 the threshold amount specified in paragraph (d). In no case is the subtraction less than zero.​
2.13 (i) For purposes of this subdivision, "provisional income" means modified adjusted gross​
2.14 income as defined in section 86(b)(2) of the Internal Revenue Code, plus one-half of the​
2.15 taxable Social Security benefits received during the taxable year, and "Social Security​
2.16 benefits" has the meaning given in section 86(d)(1) of the Internal Revenue Code.​
2.17 (j) The commissioner shall adjust the phaseout threshold amounts in paragraphs (c) and​
2.18 (d) as provided in section 270C.22. The statutory year is taxable year 2023. The maximum​
2.19 subtraction and threshold amounts as adjusted must be rounded to the nearest $10 amount.​
2.20 If the amount ends in $5, the amount is rounded up to the nearest $10 amount.​
2.21 (a) The amount of Social Security benefits received is a subtraction.​
2.22 (b) For the purposes of this section, "Social Security benefits" has the meaning given in​
2.23 section 86(d)(1) of the Internal Revenue Code.​
2.24 EFFECTIVE DATE.This section is effective for taxable years beginning after December​
2.25 31, 2024.​
2​Section 1.​
25-02026 as introduced​01/24/25 REVISOR EAP/VJ​