This bill proposes amendments to Minnesota Statutes regarding individual income taxation, specifically focusing on the treatment of tip income. It introduces a new subdivision under section 290.0132 that defines "tip income" and allows individuals to subtract reported tips from their taxable income. The bill clarifies that tips are amounts reported to employers or the IRS, and it establishes that this provision will be effective for taxable years beginning after December 31, 2024.

Additionally, the bill amends section 290.92 to exempt tip income from withholding requirements, meaning that employers will not be required to withhold taxes on tips as defined in the new subdivision. The previous language regarding the withholding of taxes on tips has been deleted, streamlining the process for both employees and employers. This change is also set to take effect for taxable years starting after December 31, 2024.

Statutes affected:
Introduction: 290.0132, 290.92