MN HF3998

Creates a Minnesota income tax subtraction for taxpayers age 17 or younger, effectively eliminating state income tax on their earnings

Taxpayers claimed as dependents on another return have their subtraction limited to: earned income, required additions to adjusted gross income, and the lesser of unearned income or twice the standard deduction for dependents

Unearned income (such as investment income) receives more limited tax relief compared to earned income (wages from work)

Amends Minnesota Statutes 2024, section 290.0132 by adding subdivision 40

Effective for taxable years beginning after December 31, 2025