Bill > SF2594

This bill increases and modifies the student loan income tax credit in Minnesota by doubling the maximum credit from $500 to $1,000 and making the credit fully refundable. Currently, eligible individuals can claim a credit against their state income taxes for student loan payments, which is calculated based on several factors including eligible loan payments, earned income, and loan interest. The bill changes the credit calculation by increasing the maximum amount and adds a provision that allows taxpayers to receive the full credit amount even if it exceeds their tax liability, meaning they would receive the difference as a direct refund. The credit remains available to part-year residents and married couples, with each spouse being eligible to claim the credit. The new provisions will take effect for taxable years beginning after December 31, 2024, which means taxpayers can first utilize these changes when filing their 2025 tax returns. An appropriation from the general fund is included to cover the potential refunds resulting from this change.

Budget and Finance

https://www.revisor.mn.gov/bills/bill.php?b=Senate&f=SF2594&ssn=0&y=2025