Minnesota Legislature
HF 3140
as introduced - 93rd Legislature (2023 - 2024) Posted on 03/27/2023 01:33pm
Current Version - as introduced
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A bill for an act
relating to taxation; individual income; modifying the itemized and standard
deduction phaseout rate; amending Minnesota Statutes 2022, sections 290.0122,
subdivision 2; 290.0123, subdivision 5.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2022, section 290.0122, subdivision 2, is amended to read:
Subd. 2.
Deductions limited; inflation adjustment.
(a) The itemized deductions of a
taxpayer with adjusted gross income in excess of the applicable amount are reduced by the
lesser of:
(1) deleted text begin threedeleted text end new text begin fivenew text end percent of the excess of the taxpayer's federal adjusted gross income over
the applicable amount; or
(2) 80 percent of the amount of the taxpayer's itemized deductions.
(b) "Applicable amount" means $194,650, or $97,325 for a married individual filing a
separate return.
(c) For the purposes of this subdivision, "itemized deductions" means the itemized
deductions otherwise allowable to the taxpayer under subdivision 1, except itemized
deductions excludes:
(1) the portion of the deduction for interest under subdivision 5 that represents investment
interest;
(2) the deduction for medical expenses under subdivision 6; and
(3) the deduction for losses under subdivision 8.
(d) For taxable years beginning after December 31, 2019, the commissioner must adjust
for inflation the applicable amounts under paragraph (b) as provided in section 270C.22.
The statutory year is taxable year 2019. The amounts as adjusted must be rounded down to
the nearest $50 amount. The threshold amount for married individuals filing separate returns
must be one-half of the adjusted amount for married individuals filing joint returns.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after December
31, 2022.
new text end
Sec. 2.
Minnesota Statutes 2022, section 290.0123, subdivision 5, is amended to read:
Subd. 5.
Deduction limited.
(a) The standard deduction of a taxpayer with adjusted
gross income in excess of the applicable amount is reduced by the lesser of:
(1) deleted text begin threedeleted text end new text begin fivenew text end percent of the excess of the taxpayer's federal adjusted gross income over
the applicable amount; or
(2) 80 percent of the standard deduction otherwise allowable under this section.
(b) "Applicable amount" means $194,650, or $97,325 for a married individual filing a
separate return.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after December
31, 2022.
new text end