HF4574

Purpose

Create a new tax relief by allowing a subtraction from Minnesota individual income tax for firefighter pension income. The goal is to reduce the taxable income of retirees who receive pensions based on service as a firefighter.

Main Provisions

• Adds Subd. 40 to Minnesota Statutes 2024 section 290.0132.
• The subtraction applies to “firefighter pension income,” defined as annuity income or a lump-sum payment from a public retirement plan based on service as a firefighter.
• The term “firefighter” is defined as in section 299N.01 subdivision 3.
• The amount of firefighter pension income is itself the subtraction from a taxpayer’s taxable income for purposes of the individual income tax.

Significant Changes to Existing Law

• Introduces a new, explicit subtraction in the individual income tax for a specific type of retirement income—firefighter pensions.
• This represents tax relief targeted to retirees receiving pension benefits tied to firefighting service, altering how firefighter pension income is treated under Minnesota tax law.

Definitions and Key Terms (as referenced in the bill)

• firefighter pension income
• annuity income
• lump-sum payment
• public retirement plan
• service as a firefighter
• Minnesota Statutes 2024 section 290.0132
• Subd. 40
• section 299N.01 subdivision 3
• subtraction
• individual income tax

Relevant Terms - firefighter pension income - annuity income - lump-sum payment - public retirement plan - service as a firefighter - subtraction - individual income tax - Minnesota Statutes 2024 - 290.0132 - Subd. 40 - 299N.01 subdivision 3