Minnesota Legislature
HF 5146
as introduced - 93rd Legislature (2023 - 2024) Posted on 03/25/2024 02:51pm
Bill Text Versions
| Engrossments | ||
|---|---|---|
| Introduction | Posted on 03/22/2024 |
Current Version - as introduced
1.6 1.7 1.8 1.9 1.10 1.11 1.12 1.13 1.14 1.15 1.16 1.17 1.18 1.19 1.20 1.21 1.22 1.23 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 2.9 2.10 2.11 2.12 2.13 2.14 2.15 2.16 2.17 2.18 2.19 2.20 2.21 2.22 2.23 2.24 2.25 2.26 2.27 2.28 2.29 2.30 2.31 2.32 2.33 3.1 3.2 3.3 3.4 3.5 3.6
3.7 3.8
3.9 3.10 3.11 3.12 3.13
3.14 3.15
A bill for an act
relating to taxation; individual income; increasing the amount of and income
phaseout threshold for the dependent care credit; amending Minnesota Statutes
2023 Supplement, section 290.067, subdivisions 1, 2b.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2023 Supplement, section 290.067, subdivision 1, is amended
to read:
Subdivision 1.
Amount of credit.
(a) A taxpayer may take as a credit against the tax
due from the taxpayer and a spouse, if any, under this chapter an amount equal to new text begin the sum
of:
new text end
new text begin
(1) $1,500; and
new text end
new text begin (2) new text end the dependent care credit for which the taxpayer is eligible pursuant to the provisions
of section 21 of the Internal Revenue Code except that in determining whether the child
qualified as a dependent, income received as a Minnesota family investment program grant
or allowance to or on behalf of the child must not be taken into account in determining
whether the child received more than half of the child's support from the taxpayer.
(b) If a child who has not attained the age of six years at the close of the taxable year is
cared for at a licensed family day care home operated by the child's parent, the taxpayer is
deemed to have paid employment-related expenses. If the child is 16 months old or younger
at the close of the taxable year, the amount of expenses deemed to have been paid equals
the maximum limit for one qualified individual under section 21(c) and (d) of the Internal
Revenue Code. If the child is older than 16 months of age but has not attained the age of
six years at the close of the taxable year, the amount of expenses deemed to have been paid
equals the amount the licensee would charge for the care of a child of the same age for the
same number of hours of care.
(c) If a taxpayer:
(1) has a child who has not attained the age of one year at the close of the taxable year;
and
(2) does not participate in a dependent care assistance program as defined in section 129
of the Internal Revenue Code, in lieu of the actual employment related expenses paid for
that child under paragraph (a) or the deemed amount under paragraph (b), the lesser of (i)
the earned income of the taxpayer or (ii) the amount of the maximum limit for one qualified
individual under section 21(c) and (d) of the Internal Revenue Code will be deemed to be
the employment related expense paid for that child. The earned income limitation of section
21(d) of the Internal Revenue Code shall not apply to this deemed amount. These deemed
amounts apply regardless of whether any employment-related expenses have been paid.
(d) If the taxpayer is not required and does not file a federal individual income tax return
for the tax year, no credit is allowed for any amount paid to any person unless:
(1) the name, address, and taxpayer identification number of the person are included on
the return claiming the credit; or
(2) if the person is an organization described in section 501(c)(3) of the Internal Revenue
Code and exempt from tax under section 501(a) of the Internal Revenue Code, the name
and address of the person are included on the return claiming the credit.
In the case of a failure to provide the information required under the preceding sentence,
the preceding sentence does not apply if it is shown that the taxpayer exercised due diligence
in attempting to provide the information required.
(e) In the case of a nonresident, part-year resident, the credit determined under section
21 of the Internal Revenue Code must be allocated based on the ratio by which the earned
income of the claimant and the claimant's spouse from Minnesota sources bears to the total
earned income of the claimant and the claimant's spouse.
(f) For residents of Minnesota, the subtractions for military pay under section 290.0132,
subdivisions 11 and 12, are not considered "earned income not subject to tax under this
chapter."
(g) For residents of Minnesota, the exclusion of combat pay under section 112 of the
Internal Revenue Code is not considered "earned income not subject to tax under this
chapter."
(h) For taxpayers with federal adjusted gross income in excess of deleted text begin $52,230deleted text end new text begin $125,000new text end ,
the credit is equal to the lesser of the credit otherwise calculated under this subdivision, or
the amount equal to $600 minus five percent of federal adjusted gross income in excess of
$52,230 for taxpayers with one qualified individual, or $1,200 minus five percent of federal
adjusted gross income in excess of deleted text begin $52,230deleted text end new text begin $125,000new text end for taxpayers with two or more
qualified individuals, but in no case is the credit less than zero.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after December
31, 2023.
new text end
Sec. 2.
Minnesota Statutes 2023 Supplement, section 290.067, subdivision 2b, is amended
to read:
Subd. 2b.
Inflation adjustment.
The commissioner shall annually adjust the dollar
amount of the income threshold at which the maximum credit begins to be reduced under
subdivision 1 as provided in section 270C.22. The statutory year is taxable year deleted text begin 2019deleted text end new text begin 2024new text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after December
31, 2024.
new text end