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SF 3865

AmeriCorps stipends and living allowances subtraction establishment provision

2025-2026 Regular Session Introduced by Heather Gustafson and 2 co-sponsors

Minnesota bill would exempt AmeriCorps stipends and living allowances from state income taxation to reduce tax burden on service program participants.

Referred to Taxes
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Bill Summary · SF 3865

Legislative bill overview

SF 3865 establishes a provision that subtracts AmeriCorps stipends and living allowances from taxable income in Minnesota. The bill would allow individuals receiving support through AmeriCorps service programs to reduce their state tax liability by the amount of those benefits. This creates a targeted tax exemption specifically for AmeriCorps participants.

Why is this important

AmeriCorps members already receive modest stipends and living allowances that are below poverty levels for many service tracks. This tax treatment directly affects whether participants can afford basic expenses and influences program participation rates. The provision also reflects state policy choices about whether to align with federal tax treatment and which public service work Minnesota wants to incentivize.

Potential points of contention

  • Revenue impact: Reducing taxable income decreases state tax collections; fiscal note would clarify costs and whether this is offset elsewhere
  • Equity concerns: Creates preferential treatment for AmeriCorps participants compared to other service workers or low-income residents not in the program
  • Federal alignment: AmeriCorps benefits have complex federal tax treatment that may already provide some relief, potentially creating duplication or conflict
  • Scope questions: Unclear if provision applies to all AmeriCorps programs equally or distinguishes between different service tracks and benefit levels

Compiled from official sources — confirm details with the bill’s official record.

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