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Bill

SF 2011

Unlimited Social Security subtraction provision

2025-2026 Regular Session Introduced by Jordan Rasmusson

Minnesota bill eliminates the cap on Social Security income deductions for state taxes, potentially reducing retiree tax liability but decreasing state revenue.

Referred to Taxes
#revenuedepartment #taxation-income
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WeVote Research Nonpartisan
Bill Summary · SF 2011

Legislative bill overview

SF 2011 proposes to remove the cap on Social Security income that Minnesota residents can subtract from their taxable income for state tax purposes. Currently, Minnesota limits this Social Security subtraction, but this bill would allow unlimited deduction of Social Security benefits, potentially reducing state income tax liability for seniors receiving these benefits.

Why is this important

Social Security represents the primary income source for many Minnesota seniors, and tax policy directly affects their disposable income and financial security. This change could significantly reduce state tax burden for retirees while potentially impacting state revenue, which funds education, healthcare, and other public services that seniors themselves may depend on.

Potential points of contention

  • Revenue impact: Removing the cap could substantially reduce state income tax revenue, requiring either budget cuts elsewhere or tax increases on other groups
  • Equity concerns: The benefit would disproportionately help higher-income seniors with substantial Social Security benefits, while providing little or no benefit to lower-income retirees
  • Fiscal sustainability: Critics may question whether the state can afford this tax reduction without identifying offsetting revenue sources or spending reductions

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

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