Bill > SF2012

This bill proposes a new tax subtraction for retirement income in Minnesota, allowing residents who are 65 years or older to deduct a portion of their retirement plan distributions from their state income taxes. Specifically, married couples filing jointly can subtract up to $150,000 in qualified retirement plan distributions, while other taxpayers can subtract up to $75,000. Qualified distributions include payments from qualified retirement plans (as defined by section 401 of the Internal Revenue Code) and individual retirement accounts (IRAs). The subtraction applies to Minnesota residents and is limited to the actual amount of distributions received or the specified maximum, whichever is less. This tax provision is designed to provide financial relief for retirees by reducing their state tax burden on retirement income. The new law will take effect for taxable years beginning after December 31, 2024, giving taxpayers and tax authorities time to prepare for the implementation of this tax benefit.

Budget and Finance

https://www.revisor.mn.gov/bills/bill.php?b=Senate&f=SF2012&ssn=0&y=2025