House Substitute

SENIOR CITIZEN PROPERTY TAX CREDIT

Current law authorizes an income tax credit for certain senior citizens and disabled veterans in amount equal to a portion of such taxpayer's property tax liabilities, with the amount of the credit dependent on the taxpayer's income and property tax liability. This act modifies the definition of "income" to increase the amount deducted from Missouri adjusted gross income from $2,000 to $2,800, or, for claimants who owned and occupied the residence for the entire year, such amount is increased from $4,000 to $5,800. (Section 135.010)

The maximum allowable credit under current law is limited to $750 in rent constituting property taxes actually paid or $1,100 in actual property tax paid. This act increases such amounts to $1,055 and $1,550, respectively, and annually adjusts such maximum amounts for inflation. (Section 135.025)

Additionally, current law limits the tax credit to qualifying taxpayers with an income of $27,500 or less, or $30,000 in the case of a homestead owned and occupied by a claimant for the entire year. This act increases such maximum income to $38,200, or $42,200 in the case of a homestead owned and occupied by a claimant for the entire year, and annually adjusts both amounts for inflation. (Section 135.030)

These provisions are substantially similar to provisions in SS/SCS/SB 15 (2023).

MOTOR FUEL TAX REFUNDS

Current law requires motor fuel tax refunds that are issued for motor fuel tax charged in excess of $0.17/gallon to be issued on a fiscal year basis. This act provides that, beginning with the 2024 fiscal year, such refunds shall be issued on a tax year basis. The act allows a taxpayer to claim such refund on a form provided by the Department of Revenue. Claimants shall certify under penalty of perjury that the information submitted is accurate. (Sections 142.822)

These provisions are similar to HB 519 (2023).

CORPORATE INCOME TAXES

Current law levies a tax on the Missouri taxable income of corporations at a rate of 4.0%. For all tax years beginning on or after January 1, 2024, this act reduces such rate to 2.0%. Additionally, beginning in the 2026 calendar year, the corporate income tax rate shall be reduced to 1.0% if in any fiscal year after the 2024 fiscal year the amount of net corporate income tax revenue collected exceeds the amount collected during the 2024 fiscal year by at least $50 million. Finally, beginning in the calendar year following the calendar year in which the rate of tax is reduced to 1.0%, the corporate income tax rate may be reduced to 0% if during any fiscal year the amount of net general revenue collected during the immediately preceding fiscal year exceeds the amount of net general revenue collected during the fiscal year in which the rate of tax was reduced to 1.0% by at least $250 million.

For all tax years beginning after the fiscal year in which the corporate income tax is eliminated, no corporate income tax credits shall be claimed in any tax years in which there is no tax imposed on the Missouri taxable income of corporations. (Section 143.071)

This provision is identical to a provision in HCS/SS#2/SCS/SB 96 (2023) and HCS/HBs 816 & 660 (2023).

RETIREMENT BENEFITS DEDUCTION

Current law allows taxpayers with certain filing status and adjusted gross income below certain thresholds to deduct 100% of Social Security retirement and disability benefits from the taxpayer's Missouri adjusted gross income, with a reduced deduction as the taxpayer's adjusted gross income increases. For all tax years beginning on or after January 1, 2024, this act allows the maximum deduction to all taxpayers regardless of filing status or adjusted gross income and allows the deduction to be taken for Social Security retirement, disability, survivors, and supplemental benefits. (Section 143.125)

This provision is identical to a provision in HCS/HBs 816 & 660 (2023) and HCS/SS#2/SCS/SB 96 (2023), and is substantially similar to a provision in SB 241 (2023), SB 247 (2023), SB 448 (2023), SB 585 (2023), SB 871 (2022), HB 2853 (2022), SB 157 (2021), SB 847 (2020), and HB 1725 (2020).

UNBORN CHILD DEDUCTION

Current law authorizes a taxpayer to claim a $1,200 exemption for each dependent for whom such taxpayer is entitled to a dependency exemption for federal tax purposes, provided such federal exemption is not equal to $0. This act authorizes a taxpayer to claim a $2,400 exemption during the tax year in which a taxpayer gives birth to a child for which the taxpayer is entitled to a dependency exemption for federal tax purposes, regardless of whether the federal exemption is equal to $0. (Section 143.161)

This act is substantially similar to SB 12 (2022 First Extraordinary Session).

JOSH NORBERG