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HF1000 (Legislative Session 94 (2025-2026))

Unlimited Social Security individual income tax subtraction provided.

Related bill: SF2284

AI Generated Summary

The bill, H.F. No. 1000, proposes modifications to the taxation of Social Security benefits for individual income tax in Minnesota. Here's a simplified summary of the key components of the proposed legislation:

  1. The bill introduces an expanded subtraction option for Social Security income on state tax returns, which aims to reduce the tax burden on Social Security benefits.

  2. Subtraction Methods: Taxpayers can choose between:

    • Simplified Subtraction: Based on taxable Social Security benefits, adjusted according to the taxpayer's income level and filing status.
    • Alternate Subtraction: Based on the lesser of the taxable benefits or a capped subtraction amount, adjusted by provisional income levels.

  3. Phaseout Thresholds and Reductions:

    • For married taxpayers filing jointly, single taxpayers, or head of household, the subtraction decreases as adjusted gross income exceeds specific thresholds ($100,000 and $78,000 respectively).
    • For married taxpayers filing separately, the calculation is adjusted at half the rate of joint filers.

  4. Maximum Subtraction:

    • The maximum subtraction amount is specified differently for married couples filing jointly, single/head of household filers, and married filing separately.
    • The subtraction is reduced by a percentage based on provisional income exceeding specific amounts laid out in the bill, with no subtraction allowed after a certain threshold.

  5. Adjustment of Thresholds: The phaseout thresholds and maximum subtraction amounts will be adjusted annually by the commissioner based on provided criteria in the legislation.

The ultimate goal of this bill is to offer more favorable tax treatment of Social Security benefits by allowing greater deductions, particularly as it pertains to individuals and couples at various income levels. This would potentially lead to decreased tax liabilities for those receiving Social Security, depending on their overall income and how it's structured.

Bill text versions

Actions

DateChamberWhereTypeNameCommittee Name
February 16, 2025HouseFloorActionIntroduction and first reading, referred toTaxes
February 23, 2025HouseFloorActionAuthor added

Citations

 
[
  {
    "analysis": {
      "added": [
        "Provides an unlimited Social Security subtraction."
      ],
      "removed": [
        "None noted."
      ],
      "summary": "This bill modifies individual income taxation related to Social Security benefits under section 290.0132.",
      "modified": [
        "Adjusts phaseout threshold amounts for taxable social security benefits."
      ]
    },
    "citation": "290.0132"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Refers to the definition of modified adjusted gross income in the Internal Revenue Code for the purposes of calculating provisional income.",
      "modified": []
    },
    "citation": "86(b)(2)"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Refers to the definition of Social Security benefits in the Internal Revenue Code used in this context.",
      "modified": []
    },
    "citation": "86(d)(1)"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "The commissioner is tasked with adjusting the phaseout threshold amounts as provided in section 270C.22.",
      "modified": []
    },
    "citation": "270C.22"
  }
]

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