SF2012

This Minnesota Senate bill (S.F. No. 2012) proposes an amendment to Minnesota Statutes 2024, section 290.0132, to provide a state income tax subtraction for certain retirement benefits.

Key Provisions:

• Allows a tax subtraction for qualified retirement distributions for Minnesota residents.
• Applies to distributions from:
  • Qualified retirement plans under IRC section 401.
  • Individual retirement accounts (IRAs) under IRC section 408.

Subtraction Limits:

1. Married taxpayers filing jointly (where both spouses are at least 65 by the end of the tax year) can subtract up to the lesser of their total qualified distributions or $150,000.
2. All other taxpayers (who are at least 65 by the end of the tax year) can subtract up to the lesser of their qualified distributions or $75,000.

This bill aims to reduce the state income tax burden on retirees by exempting a portion of their retirement income from taxation.