HF3792

Purpose

The bill would add certain AmeriCorps-related stipends, living allowances, and education awards to Minnesota’s list of tax-exempt income (a subtraction from state taxable income). This means qualifying amounts would not be taxed by Minnesota income tax.

Main Provisions

• Adds four specific items to the income subtraction in Minnesota Statutes 2024 section 290.0132 subdivision 16: 1) A stipend paid to an AmeriCorps volunteer under United States Code title 42 section 4955. 2) A living allowance provided to a National Civilian Community Corps (NCCC) volunteer under United States Code title 42 section 12618. 3) A stipend paid to an AmeriCorps Seniors volunteer under United States Code title 42 sections 5011 and 5013b. 4) A national service educational awards (awards from the National Service Trust) under United States Code title 42 sections 12601 to 12604.
• These amounts would be treated as a subtraction from income for purposes of Minnesota individual income tax for service in an approved AmeriCorps National Service program.

What This Changes About the Law

• Expands the types of AmeriCorps-related compensation that are not considered taxable income at the state level.
• Tightens or clarifies that the subtraction applies specifically to amounts tied to service in an approved AmeriCorps National Service program and cited in the referenced federal law sections.

Practical Impact

• Individuals who receive AmeriCorps stipends, AmeriCorps Seniors stipends, AmeriCorps living allowances, or National Service Educational Awards may reduce their Minnesota state income tax by the amount of those payments, to the extent they would otherwise be included in income.
• This aligns Minnesota tax treatment with federal program benefits and could lower the after-tax value of these programs for participants.

Significance and Scope

• Focuses on income tax treatment for participants in AmeriCorps and related national service programs.
• Applies to "subtraction" from income, not a tax credit or deduction elsewhere; affects how much of these payments are considered taxable by Minnesota.

Implementation Note

• The changes are enacted by amending Minnesota Statutes 2024 section 290.0132 subdivision 16, adding the listed items as protected subtractions.

Relevant Terms AmeriCorps, AmeriCorps Seniors, National Civilian Community Corps (NCCC), National Service Educational Awards, National Service Trust, United States Code, Title 42, 4955, 12618, 5011, 5013b, 12601-12604, subtraction, income, Minnesota Statutes 290.0132, subdivision 16, approved AmeriCorps National Service program, Minnesota state income tax.