S.F. No. 3368 - Summary

• Allows individuals to subtract discharges of indebtedness awarded under Minnesota statute section 332.74, subdivision 3 (coerced debt) from their state income tax, effective for taxable years beginning after December 31, 2023.

• Excludes discharges of indebtedness under section 332.74, subdivision 3 from income calculations for purposes of the property tax refund and renter's income tax credit, effective for property taxes payable in 2025 and thereafter.

• Restructures dependent exemption calculations by introducing a "combined exemption amount" that multiplies the exemption amount by graduated percentages (1.4 for first dependent down to 1.0 for fifth dependent) plus age/disability exemptions.

• Simplifies income calculations for the renter's income tax credit by replacing individual dependent multipliers with the combined exemption amount calculation.