This bill proposes a reduction in individual income tax rates in Minnesota by one percentage point across all brackets. Specifically, it amends Minnesota Statutes 2024, section 290.06, subdivisions 2c and 2d, to adjust the income tax rates for married individuals, unmarried individuals, and heads of household. The new rates will replace the previous rates, with the first bracket for married individuals filing jointly changing from 5.35% on the first $38,770 to 4.35% on the first $47,620, and similar adjustments made for other income brackets. The bill also introduces a new section that outlines adjustments to these rates for taxable years beginning after December 31, 2024, and before January 1, 2026, as well as for taxable years beginning after December 31, 2025, and before January 1, 2027.

Additionally, the bill mandates an annual inflation adjustment of the tax brackets, which will be rounded to the nearest $10 amount, with specific provisions for married individuals filing separately. The effective date for the new tax rates and adjustments is set for taxable years beginning after December 31, 2024, and for the inflation adjustments, it is effective for taxable years beginning after December 31, 2025.

Statutes affected:
Introduction: 290.06