This bill amends Minnesota Statutes to provide a subtraction for certain discharges of indebtedness, specifically those awarded under section 332.74, subdivision 3, which will not be included in income calculations for property tax refunds and renter's income tax credits. The new legal language added to section 290.0132 establishes that these discharges are considered a subtraction for tax purposes, effective for taxable years beginning after December 31, 2024. Additionally, the bill modifies section 290.0693 to define a "combined exemption amount" based on the number of dependents, with specific multipliers for each dependent, and clarifies that the amount of discharge of indebtedness subtracted under section 290.0132 will also be included in the income calculations.

Furthermore, the bill updates section 290A.03 to redefine "income" by including the amount of discharge of indebtedness awarded under section 332.74, subdivision 3, as an exclusion from taxable income. The effective date for these changes regarding property taxes is set for 2026. The amendments aim to provide tax relief for individuals who have experienced certain discharges of debt, thereby potentially increasing their eligibility for property tax refunds and renter's credits.

Statutes affected:
Introduction: 290.0132, 290.0693, 290A.03