SECONDREGULARSESSION
HOUSEBILLNO.2657
102NDGENERALASSEMBLY
INTRODUCEDBYREPRESENTATIVEMCGIRL.
5498H.01I DANARADEMANMILLER,ChiefClerk
ANACT
Torepealsection143.124,RSMo,andtoenactinlieuthereofonenewsectionrelatingto
privatepensiontaxation.
BeitenactedbytheGeneralAssemblyofthestateofMissouri,asfollows:
SectionA.Section143.124,RSMo,isrepealedandonenewsectionenactedinlieu
2thereof,tobeknownassection143.124,toreadasfollows:
143.124.1.Otherprovisionsoflawtothecontrarynotwithstanding,fortaxyears
2endingonorbeforeDecember31,2006,thetotalamountofallannuities,pensions,or
3retirementallowancesabovetheamountofsixthousanddollarsannuallyprovidedbyanylaw
4ofthisstate,theUnitedStates,oranyotherstatetoanypersonexceptasprovidedin
5subsection4ofthissection,shallbesubjecttotaxpursuanttotheprovisionsofthischapter,
6inthesamemanner,tothesameextentandunderthesameconditionsasanyothertaxable
7incomereceivedbythepersonreceivingit.Forpurposesofthissection,"annuity,pension,
8retirementbenefit,orretirementallowance"shallbedefinedasanannuity,pensionor
9retirementallowanceprovidedbytheUnitedStates,thisstate,anyotherstateoranypolitical
10subdivisionoragencyorinstitutionofthisoranyotherstate.Foralltaxyearsbeginningon
11orafterJanuary1,1998,forpurposesofthissection,annuity,pensionorretirementallowance
12shallbedefinedtoinclude401(k)plans,deferredcompensationplans,self-employed
13retirementplans,alsoknownasKeoghplans,annuitiesfromadefinedpensionplanand
14individualretirementarrangements,alsoknownasIRAs,asdescribedintheInternalRevenue
15Code,butnotincludingRothIRAs,aswellasanannuity,pensionorretirementallowance
16providedbytheUnitedStates,thisstate,anyotherstateoranypoliticalsubdivisionoragency
17orinstitutionofthisoranyotherstate.Anindividualtaxpayershallonlybealloweda
EXPLANATION—Matterenclosedinbold-facedbrackets[thus] intheabovebillisnotenactedandis
intendedtobeomittedfromthelaw.Matterinbold-facetypeintheabovebillisproposedlanguage. 18maximumdeductionequaltotheamountsprovidedunderthissectionforeachtaxpayeron
19thecombinedreturn.
20 2.FortheperiodbeginningJuly1,1989,andendingDecember31,1989,thereshall
21besubtractedfromMissouriadjustedgrossincomeforthatperiod,determinedpursuantto
22section143.121,thefirstthreethousanddollarsofretirementbenefitsreceivedbyeach
23taxpayer:
24 (1)Ifthetaxpayer'sfilingstatusissingle,headofhouseholdorqualifyingwidow(er)
25andthetaxpayer'sMissouriadjustedgrossincomeislessthantwelvethousandfivehundred
26dollars;or
27 (2)Ifthetaxpayer'sfilingstatusismarriedfilingcombinedandtheircombined
28Missouriadjustedgrossincomeislessthansixteenthousanddollars;or
29 (3)Ifthetaxpayer'sfilingstatusismarriedfilingseparatelyandthetaxpayer's
30Missouriadjustedgrossincomeislessthaneightthousanddollars.
31 3.ForthetaxyearsbeginningonorafterJanuary1,1990,butendingonorbefore
32December31,2006,thereshallbesubtractedfromMissouriadjustedgrossincome,
33determinedpursuanttosection143.121,amaximumofthefirstsixthousanddollarsof
34retirementbenefitsreceivedbyeachtaxpayerfromsourcesotherthanprivatelyfunded
35sources,andfortaxyearsbeginningonorafterJanuary1,1998,thereshallbesubtracted
36fromMissouriadjustedgrossincome,determinedpursuanttosection143.121,amaximumof
37thefirstonethousanddollarsofanyretirementallowancereceivedfromanyprivatelyfunded
38sourcefortaxyearsbeginningonorafterJanuary1,1998,butbeforeJanuary1,1999,anda
39maximumofthefirstthreethousanddollarsofanyretirementallowancereceivedfromany
40privatelyfundedsourcefortaxyearsbeginningonorafterJanuary1,1999,butbefore
41January1,2000,andamaximumofthefirstfourthousanddollarsofanyretirement
42allowancereceivedfromanyprivatelyfundedsourcefortaxyearsbeginningonorafter
43January1,2000,butbeforeJanuary1,2001,andamaximumofthefirstfivethousanddollars
44ofanyretirementallowancereceivedfromanyprivatelyfundedsourcefortaxyears
45beginningonorafterJanuary1,2001,butbeforeJanuary1,2002,andamaximumofthefirst
46sixthousanddollarsofanyretirementallowancereceivedfromanyprivatelyfundedsources
47fortaxyearsbeginningonorafterJanuary1,2002, butbeforeJanuary1,2025,anda
48maximumofthefirsttwelvethousanddollarsofanyretirementallowancereceivedfrom
49anyprivatelyfundedsourcesfortaxyearsbeginningonorafterJanuary1,2025. A
50taxpayershallbeentitledtothemaximumexemptionprovidedbythissubsection:
51 (1)Ifthetaxpayer'sfilingstatusissingle,headofhouseholdorqualifyingwidow(er)
52andthetaxpayer'sMissouriadjustedgrossincomeislessthan[twenty-five] fiftythousand
53dollars;or
HB2657 2 54 (2)Ifthetaxpayer'sfilingstatusismarriedfilingcombinedandtheircombined
55Missouriadjustedgrossincomeislessthan[thirty-two] sixty-fourthousanddollars;or
56 (3)Ifthetaxpayer'sfilingstatusismarriedfilingseparatelyandthetaxpayer's
57Missouriadjustedgrossincomeislessthan[sixteen] thirty-twothousandsixhundred
58dollars.
59 4.Ifataxpayer'sadjustedgrossincomeexceedstheadjustedgrossincomeceilingfor
60suchtaxpayer'sfilingstatus,asprovidedinsubdivisions(1),(2)and(3)ofsubsection3ofthis
61section,suchtaxpayershallbeentitledtoanexemptionequaltothegreaterofzeroorthe
62maximumexemptionprovidedinsubsection3ofthissectionreducedbyonedollarforevery
63dollarsuchtaxpayer'sincomeexceedstheceilingforhisorherfilingstatus.
64 5.Forpurposesofthissubsection,theterm"maximumSocialSecuritybenefit
65available"shallmeanthirty-twothousandfivehundreddollarsforthetaxyearbeginningon
66orafterJanuary1,2007,andforeachsubsequenttaxyearsuchamountshallbeincreasedby
67thepercentageincreaseintheConsumerPriceIndexforAllUrbanConsumers,orits
68successorindex,assuchindexisdefinedandofficiallyreportedbytheUnitedStates
69DepartmentofLabor,oritssuccessoragency.ForthetaxyearbeginningonorafterJanuary
701,2007,butendingonorbeforeDecember31,2007,thereshallbesubtractedfromMissouri
71adjustedgrossincome,determinedpursuanttosection143.121,amaximumofanamount
72equaltothegreaterof:sixthousanddollarsinretirementbenefitsreceivedfromsourcesother
73thanprivatelyfundedsources,totheextentsuchbenefitsareincludedinthetaxpayer'sfederal
74adjustedgrossincome;ortwentypercentoftheretirementbenefitsreceivedfromsources
75otherthanprivatelyfundedsourcesinthetaxyear,butnottoexceedthemaximumSocial
76Securitybenefitavailableforsuchtaxyear.ForthetaxyearbeginningonorafterJanuary1,
772008,butendingonorbeforeDecember31,2008,thereshallbesubtractedfromMissouri
78adjustedgrossincome,determinedpursuanttosection143.121,amaximumofanamount
79equaltothegreaterof:sixthousanddollarsinretirementbenefitsreceivedfromsourcesother
80thanprivatelyfundedsources,totheextentsuchbenefitsareincludedinthetaxpayer'sfederal
81adjustedgrossincome;orthirty-fivepercentoftheretirementbenefitsreceivedfromsources
82otherthanprivatelyfundedsourcesinthetaxyear,butnottoexceedthemaximumSocial
83Securitybenefitavailableforsuchtaxyear.ForthetaxyearbeginningonorafterJanuary1,
842009,butendingonorbeforeDecember31,2009,thereshallbesubtractedfromMissouri
85adjustedgrossincome,determinedpursuanttosection143.121,amaximumofanamount
86equaltothegreaterof:sixthousanddollarsinretirementbenefitsreceivedfromsourcesother
87thanprivatelyfundedsources,totheextentsuchbenefitsareincludedinthetaxpayer'sfederal
88adjustedgrossincome;orfiftypercentoftheretirementbenefitsreceivedfromsourcesother
89thanprivatelyfundedsourcesinthetaxyear,butnottoexceedthemaximumSocialSecurity
90benefitavailableforsuchtaxyear.ForthetaxyearbeginningonorafterJanuary1,2010,but
HB2657 3 91endingonorbeforeDecember31,2010,thereshallbesubtractedfromMissouriadjusted
92grossincome,determinedpursuanttosection143.121,amaximumofanamountequaltothe
93greaterof:sixthousanddollarsinretirementbenefitsreceivedfromsourcesotherthan
94privatelyfundedsources,totheextentsuchbenefitsareincludedinthetaxpayer'sfederal
95adjustedgrossincome;orsixty-fivepercentoftheretirementbenefitsreceivedfromsources
96otherthanprivatelyfundedsourcesinthetaxyear,butnottoexceedthemaximumSocial
97Securitybenefitavailableforsuchtaxyear.ForthetaxyearbeginningonorafterJanuary1,
982011,butendingonorbeforeDecember31,2011,thereshallbesubtractedfromMissouri
99adjustedgrossincome,determinedpursuanttosection143.121,amaximumofanamount
100equaltothegreaterof:sixthousanddollarsinretirementbenefitsreceivedfromsourcesother
101thanprivatelyfundedsources,totheextentsuchbenefitsareincludedinthetaxpayer'sfederal
102adjustedgrossincome;oreightypercentoftheretirementbenefitsreceivedfromsources
103otherthanprivatelyfundedsourcesinthetaxyear,butnottoexceedthemaximumSocial
104Securitybenefitavailableforsuchtaxyear.ForalltaxyearsbeginningonorafterJanuary1,
1052012,thereshallbesubtractedfromMissouriadjustedgrossincome,determinedpursuantto
106section143.121,amaximumofanamountequaltoonehundredpercentoftheretirement
107benefitsreceivedfromsourcesotherthanprivatelyfundedsourcesinthetaxyear,butnotto
108exceedthemaximumSocialSecuritybenefitavailableforsuchtaxyear.Foralltaxyears
109beginningonorbeforeDecember31,2023,ataxpayershallbeentitledtothemaximum
110exemptionprovidedbythissubsection:
111 (1)Ifthetaxpayer'sfilingstatusismarriedfilingcombined,andtheircombined
112Missouriadjustedgrossincomeisequaltoorlessthanonehundredthousanddollars;or
113 (2)Ifthetaxpayer'sfilingstatusissingle,headofhousehold,qualifyingwidow(er),
114ormarriedfilingseparately,andthetaxpayer'sMissouriadjustedgrossincomeisequaltoor
115lessthaneighty-fivethousanddollars.
116
117ForalltaxyearsbeginningonorafterJanuary1,2024,ataxpayershallbeentitledtothe
118maximumexemptionprovidedbythissubsectionregardlessofthetaxpayer'sfilingstatusor
119theamountofthetaxpayer'sMissouriadjustedgrossincome.
120 6.ForalltaxyearsbeginningonorbeforeDecember31,2023,ifataxpayer's
121adjustedgrossincomeexceedstheadjustedgrossincomeceilingforsuchtaxpayer'sfiling
122status,asprovidedinsubdivisions(1)and(2)ofsubsection5ofthissection,suchtaxpayer
123shallbeentitledtoanexemption,lessanyapplicablereductionprovidedundersubsection7
124ofthissection,equaltothegreaterofzeroorthemaximumexemptionprovidedinsubsection
1255ofthissectionreducedbyonedollarforeverydollarsuchtaxpayer'sincomeexceedsthe
126ceilingforhisorherfilingstatus.
HB2657 4 127 7.Forpurposesofcalculatingthesubtractionprovidedinsubsection5ofthissection,
128suchsubtractionshallbedecreasedbyanamountequaltoanySocialSecuritybenefit
129exemptionprovidedundersection143.125.
130 8.Forpurposesofthissection,anySocialSecuritybenefitsotherwiseincludedin
131Missouriadjustedgrossincomeshallbesubtracted;butSocialSecuritybenefitsshallnotbe
132subtractedforpurposesofothercomputationspursuanttothischapter,andarenottobe
133consideredasretirementbenefitsforpurposesofthissection.
134 9.Theprovisionsofsubdivisions(1)and(2)ofsubsection3ofthissectionshall
135applyduringalltaxyearsinwhichthefederalInternalRevenueCodeprovidesexemption
136levelsforcalculationofthetaxabilityofSocialSecuritybenefitsthatarethesameasthe
137levelsinsubdivisions(1)and(2)ofsubsection3ofthissection.Iftheexemptionlevelsfor
138thecalculationofthetaxabilityofSocialSecuritybenefitsareadjustedbyapplicablefederal
139laworregulation,theexemptionlevelsinsubdivisions(1)and(2)ofsubsection3ofthis
140sectionshallbeaccordinglyadjustedtothesameexemptionlevels.
141 10.Theportionofataxpayer'slumpsumdistributionfromanannuityorother
142retirementplannototherwiseincludedinMissouriadjustedgrossincomeascalculated
143pursuanttothischapterbutsubjecttotaxationunderInternalRevenueCodeSection402shall
144betaxedinanamountequaltotenpercentofthetaxpayer'sfederalliabilityonsuch
145distributionforthesametaxyear.
146 11.Forpurposesofthissection,retirementbenefitsreceivedshallnotincludeany
147withdrawalsfromqualifiedretirementplanswhicharesubsequentlyrolledoverintoanother
148retirementplan.
149 12.Theexemptionsprovidedforinthissectionshallnotaffectthecalculationofthe
150incometobeusedtodeterminethepropertytaxcreditprovidedinsections135.010to
151135.035.
152 13.Theexemptionsprovidedforinthissectionshallapplytoanyannuity,pension,or
153retirementallowanceasdefinedinsubsection1ofthissectiontotheextentthatsuchamounts
154areincludedinthetaxpayer'sfederaladjustedgrossincomeandnototherwisedeductedfrom
155thetaxpayer'sfederaladjustedgrossincomeinthecalculationofMissouritaxableincome.
156Thissubsectionshallnotapplytoanyindividualwhoqualifiesunderfederalguidelinestobe
157onehundredpercentdisabled.
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HB2657 5