SF 1833

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  to a percentage of earned income.  To receive a credit, a 
  1.13  taxpayer must be 50 percent of the credit for which the taxpayer 
  1.14  is eligible for a credit under section 32 of the Internal 
  1.15  Revenue Code.  
  1.16     (b) For individuals with no qualifying children, the credit 
  1.17  equals 1.1475 percent of the first $4,460 of earned income.  The 
  1.18  credit is reduced by 1.1475 percent of earned income or modified 
  1.19  adjusted gross income, whichever is greater, in excess of 
  1.20  $5,570, but in no case is the credit less than zero. 
  1.21     (c) For individuals with one qualifying child, the credit 
  1.22  equals 6.8 percent of the first $6,680 of earned income and 8.5 
  1.23  percent of earned income over $11,650 but less than $12,990.  
  1.24  The credit is reduced by 4.77 percent of earned income or 
  1.25  modified adjusted gross income, whichever is greater, in excess 
  1.26  of $14,560, but in no case is the credit less than zero. 
  2.1      (d) For individuals with two or more qualifying children, 
  2.2   the credit equals eight percent of the first $9,390 of earned 
  2.3   income and 20 percent of earned income over $14,350 but less 
  2.4   than $16,230.  The credit is reduced by 8.8 percent of earned 
  2.5   income or modified adjusted gross income, whichever is greater, 
  2.6   in excess of $17,280, but in no case is the credit less than 
  2.7   zero. 
  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.