Says Historic Measure Will Deliver Billions in Tax Relief to Millions of Workers, Families, Charities, and Seniors; Bolster Public Safety Across the State
SAINT PAUL, Minn. – Senate Majority Leader Kari Dziedzic (DFL-Minneapolis) said the Senate on Sunday passed the largest tax cut in state history, delivering tax relief to millions of workers, families, charities, and seniors. It includes a child tax credit that will cut child poverty across the state by one-third, more than $1.24 billion in Social Security tax cuts for 322,000 Minnesota Seniors, as well as $300 million to bolster public safety in every Minnesota community.
Majority Leader Dziedzic said the bill – authored by Senate Tax Chair Ann Rest (DFL-New Hope) and Vice Chair Matt Klein (DFL-Mendota Heights) – also passed the House on Saturday and will now be sent to the Governor to be signed into law. Majority Leader Dziedzic said the bill focuses on putting money in the pockets of Minnesota’s working families and individuals. It also sends funds to local governments to keep property taxes down for homeowners, renters, seniors, and farmers.
“This historic tax bill is part of a balanced budget that includes the largest tax cuts in Minnesota history,” said Majority Leader Dziedzic. “It includes billions of dollars in child tax credits that will cut child poverty by one-third, and hundreds of millions of dollars in property tax relief, as well as delivering more than $1.2 billion in Social Security tax cuts to seniors. Importantly, it includes $300 million in public safety funding that will help every Minnesota community take steps to keep residents safe. We told Minnesotans we would build an economy that works for everyone, and this bill is a key part of that priority.”
Key Provisions in the bill include:
- $1.13 billion in one-time tax rebates for 2.58 million Minnesota taxpayers. The $260 rebates will go to married couples earning under $150,000 per year and single filers under $78,000. Households can receive up to $1,300: $260 per adult and $260 per child, up to three kids. The rebates will be based on 2021 taxes.
- $1.52 billion over four years in tax relief through a new Child Tax Credit equal to $1,750 per-child under age 18 with no limit on the number of children covered. The full credit applies to families making up to $35,000 and phases out at higher incomes, depending on the number of children. The tax credit will reduce child poverty across the state by 30 percent.
- $ 1.24 Billion reduction in Social Security taxes over four years, eliminating the tax for couples earning up to $100,000 and phasing out at $140,000 and individuals earning up to $78,000, phasing out at $118,000. Under this provision, 76 percent of Minnesotans with Social Security income will not pay taxes on that income. Seniors, who receive public pensions instead of Social Security because they worked jobs such as state troopers, firefighters, public safety officers, and some teachers will be able to subtract up to $25,000 of those benefits if they make less than $120,000/year.
- The bill also includes $300 million to address urgent public safety needs in communities across the state$ 160 million for local and county governments.
- The tax bill delivers a $61.9 million tax cut to Minnesota charities, the first since 2012.
- Hundreds of millions of dollars in property tax relief for homeowners, renters, seniors, and farmers.
- The bill also allows the state to pay off the stadium 23 years early, which provides about $220 million in interest cost savings to Minnesota taxpayers.
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