HF 609

as introduced - 88th Legislature (2013 - 2014) Posted on 02/14/2013 02:00pm

A bill for an act
relating to taxes; individual income; providing a refundable credit for payment
of principal and interest on student loans; proposing coding for new law in
Minnesota Statutes, chapter 290.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [290.0684] STUDENT LOAN CREDIT.
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new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For purposes of this section, the following terms
have the meanings given.
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new text begin (b) "Allowance for tuition and fees" is the amount set in law as required under
section 136A.121, subdivision 6.
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new text begin (c) "Eligible individual" means an individual who is a Minnesota resident who
completed a degree program at a postsecondary educational institution located in Minnesota
or at a public postsecondary educational institution located in a state that had a tuition
reciprocity agreement under section 136A.08 in effect when the individual graduated.
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new text begin (d) "Postsecondary educational institution" means a public postsecondary institution
or a private, nonprofit, degree-granting institution.
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new text begin (e) "Qualified education loan" has the meaning given in section 221 of the Internal
Revenue Code, but is limited to indebtedness incurred:
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new text begin (1) through a federal subsidized Perkins or Stafford loan;
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new text begin (2) on behalf of the taxpayer or taxpayer's spouse; and
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new text begin (3) to pay tuition and fees for academic year 2012-2013 or later.
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new text begin Subd. 2. new text end

new text begin Maximum qualifying amount. new text end

new text begin For an eligible individual who completed
a degree program at a two-year postsecondary educational institution, the maximum
qualifying amount equals the allowance for tuition and fees specified for a two-year
institution for the individual's final year of attendance, and for an eligible individual
who completed a degree program at a four-year postsecondary educational institution,
the maximum qualifying amount equals the allowance for tuition and fees specified for a
four-year institution for the individual's final year of attendance.
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new text begin Subd. 3. new text end

new text begin Credit allowed. new text end

new text begin (a) An eligible individual is allowed a credit against the
tax due under this chapter.
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new text begin (b) The credit amount equals the least of:
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new text begin (1) the amount the individual paid during the taxable year to pay principal and
interest on qualified education loans;
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new text begin (2) the maximum qualifying amount; or
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new text begin (3) $500.
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new text begin Subd. 4. new text end

new text begin Credit refundable. new text end

new text begin If the amount of credit which a taxpayer is eligible
to receive under this section exceeds the taxpayer's tax liability under this chapter, the
commissioner shall refund the excess to the taxpayer.
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new text begin Subd. 5. new text end

new text begin Appropriation. new text end

new text begin An amount sufficient to pay the refunds required by this
section is appropriated to the commissioner from the general fund.
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new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2012.
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