Creates an income tax deduction for certain dependents
If enacted, SB 371 will influence state tax laws by effectively increasing the financial relief available to taxpayers with dependents. The extended deductions—including those for older dependents and provisions related to stillbirths—aim to mitigate the financial impact of raising children within the state. With additional allowances for births qualifying for tax exemptions, this bill serves to enhance family support mechanisms through fiscal incentives, potentially improving the state's attractiveness for families and new births.
Senate Bill 371, introduced by Senator Moon, seeks to amend section 143.161 of Missouri state tax law by providing specific income tax deductions for certain dependents. The bill proposes a deduction of $1,200 for each dependent that taxpayers claim for federal income tax purposes, ensuring that this deduction is applicable only if the dependent is not classified as having a zero exemption amount under federal law. Notably, the bill also offers an additional $1,000 deduction for dependents aged 65 or older, provided certain residency and healthcare stipulations are met, such as not receiving Medicaid or state funding while residing in a licensed facility.
Discussion surrounding SB 371 may center on its implications for state revenue and the potential burden it places on state finances. Critics may argue that while the intention is to provide financial relief to families, the long-term effects on state coffers should be scrutinized. There may be concerns regarding equitable access to these deductions and whether they truly benefit all segments of the population or inadvertently favor those in higher income brackets. Additionally, discussions may arise on legislation related to dependent status, emphasizing the importance of clear and consistent definitions within tax law.