Bill > HF2268

This bill modifies Minnesota state income tax law to create a new tax subtraction for certain retirement plan distributions for residents aged 65 and older. Specifically, the bill allows taxpayers who receive qualified distributions from retirement plans like 401(k)s or Individual Retirement Accounts (IRAs) to subtract a portion of those distributions from their state taxable income. For married couples filing jointly where both spouses are 65 or older, the subtraction is limited to the lesser of their actual qualified distributions or $150,000. For all other taxpayers who are 65 or older (such as single or married individuals filing separately), the subtraction is capped at the lesser of their qualified distributions or $75,000. The provision is designed to provide tax relief for retirees by reducing their state tax burden on retirement income. The new tax subtraction will take effect for taxable years beginning after December 31, 2024, meaning it will first apply to the 2025 tax year.

Budget and Finance

https://www.revisor.mn.gov/bills/bill.php?b=House&f=HF2268&ssn=0&y=2025