as introduced - 81st Legislature (1999 - 2000) Posted on 12/15/2009 12:00am
1.1 A bill for an act 1.2 relating to taxation; basing the working family credit 1.3 on the federal earned income tax credit; amending 1.4 Minnesota Statutes 1998, section 290.0671, subdivision 1.5 1; repealing Minnesota Statutes 1998, section 1.6 290.0671, subdivision 1a. 1.7 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 1.8 Section 1. Minnesota Statutes 1998, section 290.0671, 1.9 subdivision 1, is amended to read: 1.10 Subdivision 1. [CREDIT ALLOWED.](a)An individual is 1.11 allowed a credit against the tax imposed by this chapter equal 1.12 toa percentage of earned income. To receive a credit, a1.13taxpayer must be50 percent of the credit for which the taxpayer 1.14 is eligiblefor a creditunder section 32 of the Internal 1.15 Revenue Code. 1.16(b) For individuals with no qualifying children, the credit1.17equals 1.1475 percent of the first $4,460 of earned income. The1.18credit is reduced by 1.1475 percent of earned income or modified1.19adjusted gross income, whichever is greater, in excess of1.20$5,570, but in no case is the credit less than zero.1.21(c) For individuals with one qualifying child, the credit1.22equals 6.8 percent of the first $6,680 of earned income and 8.51.23percent of earned income over $11,650 but less than $12,990.1.24The credit is reduced by 4.77 percent of earned income or1.25modified adjusted gross income, whichever is greater, in excess1.26of $14,560, but in no case is the credit less than zero.2.1(d) For individuals with two or more qualifying children,2.2the credit equals eight percent of the first $9,390 of earned2.3income and 20 percent of earned income over $14,350 but less2.4than $16,230. The credit is reduced by 8.8 percent of earned2.5income or modified adjusted gross income, whichever is greater,2.6in excess of $17,280, but in no case is the credit less than2.7zero.2.8(e)For a nonresident or part-year resident, the credit 2.9 determined under section 32 of the Internal Revenue Code must be 2.10 allocated based on the percentage calculated under section 2.11 290.06, subdivision 2c, paragraph (e). 2.12(f)For a person who was a resident for the entire tax year 2.13 and has earned income not subject to tax under this chapter, the 2.14 credit must be allocated based on the ratio of federal adjusted 2.15 gross income reduced by the earned income not subject to tax 2.16 under this chapter over federal adjusted gross income. 2.17 Sec. 2. [REPEALER.] 2.18 Minnesota Statutes 1998, section 290.0671, subdivision 1a, 2.19 is repealed. 2.20 Sec. 3. [EFFECTIVE DATE.] 2.21 Sections 1 and 2 are effective for taxable years beginning 2.22 after December 31, 1998.