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HF 2084

1st Engrossment - 89th Legislature (2015 - 2016) Posted on 04/20/2015 11:51am

KEY: stricken = removed, old language.
underscored = added, new language.

Bill Text Versions

Engrossments
Introduction Posted on 03/23/2015
1st Engrossment Posted on 03/26/2015

Current Version - 1st Engrossment

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A bill for an act
relating to taxation; individual income; allowing a refundable credit for student
loan principal and interest payments; appropriating money; 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.
new text end

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.
new text end

new text begin (b) "Adjusted gross income" means federal adjusted gross income as defined in
section 62 of the Internal Revenue Code.
new text end

new text begin (c) "Earned income" has the meaning given in section 32(c) of the Internal Revenue
Code.
new text end

new text begin (d) "Eligible individual" means an individual with one or more qualified education
loans related to an undergraduate or graduate degree program at a postsecondary
educational institution.
new text end

new text begin (e) "Eligible loan payments" means the amount the eligible individual paid during
the taxable year to pay principal and interest on qualified education loans.
new text end

new text begin (f) "Postsecondary educational institution" means a postsecondary institution eligible
for state student aid under section 136A.103 or, if the institution is not located in this state,
a postsecondary institution participating in the federal Pell Grant program under Title IV
of the Higher Education Act of 1965, Public Law 89-329, as amended.
new text end

new text begin (g) "Qualified education loan" has the meaning given in section 221 of the Internal
Revenue Code, but is limited to indebtedness incurred on behalf of the eligible individual
or the eligible individual's spouse.
new text end

new text begin Subd. 2. 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.
new text end

new text begin (b) The credit for an eligible individual equals the lesser of:
new text end

new text begin (1) eligible loan payments minus ten percent of an amount equal to adjusted gross
income in excess of $10,000, but in no case less than zero;
new text end

new text begin (2) the earned income for the taxable year of the eligible individual and spouse,
if any; or
new text end

new text begin (3) the sum of:
new text end

new text begin (i) the interest portion of eligible loan payments made during the taxable year; and
new text end

new text begin (ii) ten percent of the original loan amount of all qualified education loans of the
eligible individual and the eligible individual's spouse.
new text end

new text begin (c) For a nonresident or part-year resident, the credit must be allocated based on the
percentage calculated under section 290.06, subdivision 2c, paragraph (e).
new text end

new text begin Subd. 3. new text end

new text begin Credit refundable. new text end

new text begin If the amount of credit that an individual is eligible
to receive under this section exceeds the individual's tax liability under this chapter, the
commissioner shall refund the excess to the individual.
new text end

new text begin Subd. 4. 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.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2014.
new text end