MN SF15

Expands Social Security benefits subtraction by increasing maximum subtraction amounts to $5,150 for joint filers and $4,020 for single filers, with income-based phase-outs beginning at $78,180 and $61,080 respectively.

Establishes new public pension income subtraction allowing exclusion of qualified public pension benefits based on provisional income thresholds, with maximum state exclusions of $5,450 for joint returns and $4,260 for other filers.

Defines qualified benefits to include amounts from Minnesota public pension plans, federal retirement systems, and reciprocal public retirement systems from other states, excluding amounts also received as Social Security benefits.

Applies tiered federal exclusion formula for public pension benefits: 100 percent exclusion below base amount, declining exclusion between base and adjusted base amount, and minimum 15 percent exclusion above adjusted base amount.

All provisions effective for taxable years beginning after December 31, 2022, with annual adjustments to dollar amounts indexed to inflation using taxable year 2019 (Social Security) or 2022 (pensions) as the baseline.