ST. PAUL, MN – Today the Minnesota House of Representatives passed legislation that cuts taxes for middle class Minnesotans and repeals three businesses-to-business taxes, including a tax on farm equipment repairs.
“With an anticipated surplus of $1.2 billion, we’re in a position to provide additional tax relief for middle class Minnesotans, family farmers and small businesses while maintaining a structurally balanced budget,” said State Representative Jeanne Poppe (DFL – Austin), who chairs the House Agriculture Policy Committee. “Minnesotans expect us to continue to make sound fiscal decisions and we take that responsibility seriously. The boost to individuals, families and businesses at this critical time in the tax season is a priority for the Governor and the Minnesota House."
The $500 million tax cut package (HF 1777), which passed by a vote of 126-2, conforms the state tax code to the federal tax code, including most retroactive provisions for tax year 2013 and all provisions going forward. Conformity simplifies the tax filing process and cuts middle class taxes by eliminating unnecessary burdens like the “marriage penalty.”
According to the non-partisan House Research Department, those middle class tax cuts total $200 million, including:
$111 million for middle income married families by eliminating the “marriage penalty”
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650,000 families will see an average tax decrease of $115
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The vast majority of families claiming the standard deduction make less than $75,000
$36 million for low income working families by matching the state’s Working Family Credit with the federal Earned Income Tax Credit (EITC)
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More than 50,000 working families will see an average tax decrease of $300
$7.2 million for homeowners that refinanced or had a short sale
$3.9 million for new homeowners through deduction of mortgage insurance premiums
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80,000 new homeowners will see an average tax cut of $60
$26.4 million for students and parents paying for college and students paying off loans
$1.8 million for Minnesota families with dependents
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25,000 families with household incomes below $38,570 will see a $65 tax decrease
$400,000 for adopting who receive adoption assistance from employers
$1.1 million for 60,000 teachers with the classroom expense deduction for educators
$4 million for charitable contributions
$1.8 million for Minnesota families with dependents
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25,000 families with household incomes below $38,570 will see a $65 tax decrease
$6.7 million for businesses - to make tax filing simpler for businesses
HF 1777 also repeals three business-to-business taxes and provides a refund for taxes paid on commercial equipment repair, including farm equipment and any warehouse services.
Rep. Poppe encourages her constituents to contact her with any questions, comments or other feedback during the 2014 Session. She can be reached by phone at (651) 296-4193, by email at rep.jeanne.poppe@house.mn, or by postal mail at 487 State Office Building, 100 Rev. Dr. Martin Luther King Jr. Blvd., St. Paul, MN 55155.