The bill amends Minnesota Statutes 2024, section 290.0132, subdivision 21, to expand the subtraction for military retirement pay from individual income tax. It introduces new provisions that allow taxpayers to subtract specific amounts from their federal adjusted gross income, including compensation received from military pensions and retirement pay. The bill specifies that the subtraction applies to three categories: compensation from military service pensions, federal employee retirement system pensions, and civil service retirement system pensions, each adjusted by the taxpayer's military service ratio.

Additionally, the bill defines "military service ratio" and outlines how it is calculated for both federal employee and civil service retirement system pensions. It clarifies that the calculation will consider only full years and months of service, excluding any fractional parts. The changes will take effect for taxable years beginning after December 31, 2024.

Statutes affected:
Introduction: 290.0132