FIRSTREGULARSESSION
HOUSEBILLNO.1364
103RDGENERALASSEMBLY
INTRODUCEDBYREPRESENTATIVECATON.
2749H.01I JOSEPHENGLER,ChiefClerk
ANACT
Torepealsection143.121,RSMo,andtoenactinlieuthereofonenewsectionrelatingtoan
incometaxdeductionforcertainelectionworkercompensation.
BeitenactedbytheGeneralAssemblyofthestateofMissouri,asfollows:
SectionA.Section143.121,RSMo,isrepealedandonenewsectionenactedinlieu
2thereof,tobeknownassection143.121,toreadasfollows:
143.121.1.TheMissouriadjustedgrossincomeofaresidentindividualshallbethe
2taxpayer'sfederaladjustedgrossincomesubjecttothemodificationsinthissection.
3 2.Thereshallbeaddedtothetaxpayer'sfederaladjustedgrossincome:
4 (1)Theamountofanyfederalincometaxrefundreceivedforaprioryearwhich
5resultedinaMissouriincometaxbenefit.Theamountaddedpursuanttothissubdivision
6shallnotincludeanyamountofafederalincometaxrefundattributabletoataxcredit
7reducingataxpayer'sfederaltaxliabilitypursuanttoPublicLaw116-136or116-260,enacted
8bythe116thUnitedStatesCongress,forthetaxyearbeginningonorafterJanuary1,2020,
9andendingonorbeforeDecember31,2020,anddeductedfromMissouriadjustedgross
10incomepursuanttosection143.171.Theamountaddedunderthissubdivisionshallalsonot
11includeanyamountofafederalincometaxrefundattributabletoataxcreditreducinga
12taxpayer'sfederaltaxliabilityunderanyotherfederallawthatprovidesdirecteconomic
13impactpaymentstotaxpayerstomitigatefinancialchallengesrelatedtotheCOVID-19
14pandemic,anddeductedfromMissouriadjustedgrossincomeundersection143.171;
15 (2)Interestoncertaingovernmentalobligationsexcludedfromfederalgrossincome
16by26U.S.C.Section103oftheInternalRevenueCode,asamended.Theprevioussentence
17shallnotapplytointerestonobligationsofthestateofMissourioranyofitspolitical
EXPLANATION—Matterenclosedinbold-facedbrackets[thus] intheabovebillisnotenactedandis
intendedtobeomittedfromthelaw.Matterinbold-facetypeintheabovebillisproposedlanguage. 18subdivisionsorauthoritiesandshallnotapplytotheinterestdescribedinsubdivision(1)of
19subsection3ofthissection.Theamountaddedpursuanttothissubdivisionshallbereduced
20bytheamountsapplicabletosuchinterestthatwouldhavebeendeductibleincomputingthe
21taxableincomeofthetaxpayerexceptonlyfortheapplicationof26U.S.C.Section265ofthe
22InternalRevenueCode,asamended.Thereductionshallonlybemadeifitisatleastfive
23hundreddollars;
24 (3)Theamountofanydeductionthatisincludedinthecomputationoffederal
25taxableincomepursuantto26U.S.C.Section168oftheInternalRevenueCodeasamended
26bytheJobCreationandWorkerAssistanceActof2002totheextenttheamountdeducted
27relatestopropertypurchasedonorafterJuly1,2002,butbeforeJuly1,2003,andtothe
28extenttheamountdeductedexceedstheamountthatwouldhavebeendeductiblepursuantto
2926U.S.C.Section168oftheInternalRevenueCodeof1986asineffectonJanuary1,2002;
30 (4)Theamountofanydeductionthatisincludedinthecomputationoffederal
31taxableincomefornetoperatinglossallowedby26U.S.C.Section172oftheInternal
32RevenueCodeof1986,asamended,otherthanthedeductionallowedby26U.S.C.Section
33172(b)(1)(G)and26U.S.C.Section172(i)oftheInternalRevenueCodeof1986,as
34amended,foranetoperatinglossthetaxpayerclaimsinthetaxyearinwhichthenet
35operatinglossoccurredorcarriesforwardforaperiodofmorethantwentyyearsandcarries
36backwardformorethantwoyears.Anyamountofnetoperatinglosstakenagainstfederal
37taxableincomebutdisallowedforMissouriincometaxpurposespursuanttothissubdivision
38afterJune18,2002,maybecarriedforwardandtakenagainstanyincomeontheMissouri
39incometaxreturnforaperiodofnotmorethantwentyyearsfromtheyearoftheinitialloss;
40and
41 (5)FornonresidentindividualsinalltaxableyearsendingonorafterDecember31,
422006,theamountofanypropertytaxespaidtoanotherstateorapoliticalsubdivisionof
43anotherstateforwhichadeductionwasallowedonsuchnonresident'sfederalreturninthe
44taxableyearunlesssuchstate,politicalsubdivisionofastate,ortheDistrictofColumbia
45allowsasubtractionfromincomeforpropertytaxespaidtothisstateforpurposesof
46calculatingincomefortheincometaxforsuchstate,politicalsubdivisionofastate,orthe
47DistrictofColumbia;
48 (6)ForalltaxyearsbeginningonorafterJanuary1,2018,anyinterestexpensepaid
49oraccruedinaprevioustaxableyear,butallowedasadeductionunder26U.S.C.Section
50163,asamended,inthecurrenttaxableyearbyreasonofthecarryforwardofdisallowed
51businessinterestprovisionsof26U.S.C.Section163(j),asamended.Forthepurposesofthis
52subdivision,aninterestexpenseisconsideredpaidoraccruedonlyinthefirsttaxableyearthe
53deductionwouldhavebeenallowableunder26U.S.C.Section163,asamended,ifthe
54limitationunder26U.S.C.Section163(j),asamended,didnotexist.
HB1364 2 55 3.Thereshallbesubtractedfromthetaxpayer'sfederaladjustedgrossincomethe
56followingamountstotheextentincludedinfederaladjustedgrossincome:
57 (1)Interestreceivedondepositsheldatafederalreservebankorinterestordividends
58onobligationsoftheUnitedStatesanditsterritoriesandpossessionsorofanyauthority,
59commissionorinstrumentalityoftheUnitedStatestotheextentexemptfromMissouri
60incometaxespursuanttothelawsoftheUnitedStates.Theamountsubtractedpursuantto
61thissubdivisionshallbereducedbyanyinterestonindebtednessincurredtocarrythe
62describedobligationsorsecuritiesandbyanyexpensesincurredintheproductionofinterest
63ordividendincomedescribedinthissubdivision.Thereductionintheprevioussentence
64shallonlyapplytotheextentthatsuchexpensesincludingamortizablebondpremiumsare
65deductedindeterminingthetaxpayer'sfederaladjustedgrossincomeorincludedinthe
66taxpayer'sMissouriitemizeddeduction.Thereductionshallonlybemadeiftheexpenses
67totalatleastfivehundreddollars;
68 (2)Theportionofanygain,fromthesaleorotherdispositionofpropertyhavinga
69higheradjustedbasistothetaxpayerforMissouriincometaxpurposesthanforfederal
70incometaxpurposesonDecember31,1972,thatdoesnotexceedsuchdifferenceinbasis.If
71againisconsideredalong-termcapitalgainforfederalincometaxpurposes,themodification
72shallbelimitedtoone-halfofsuchportionofthegain;
73 (3)Theamountnecessarytopreventthetaxationpursuanttothischapterofany
74annuityorotheramountofincomeorgainwhichwasproperlyincludedinincomeorgainand
75wastaxedpursuanttothelawsofMissouriforataxableyearpriortoJanuary1,1973,tothe
76taxpayer,ortoadecedentbyreasonofwhosedeaththetaxpayeracquiredtherighttoreceive
77theincomeorgain,ortoatrustorestatefromwhichthetaxpayerreceivedtheincomeor
78gain;
79 (4)Accumulationdistributionsreceivedbyataxpayerasabeneficiaryofatrusttothe
80extentthatthesameareincludedinfederaladjustedgrossincome;
81 (5)Theamountofanystateincometaxrefundforaprioryearwhichwasincludedin
82thefederaladjustedgrossincome;
83 (6)Theportionofcapitalgainspecifiedinsection135.357thatwouldotherwisebe
84includedinfederaladjustedgrossincome;
85 (7)Theamountthatwouldhavebeendeductedinthecomputationoffederaltaxable
86incomepursuantto26U.S.C.Section168oftheInternalRevenueCodeasineffecton
87January1,2002,totheextentthatamountrelatestopropertypurchasedonorafterJuly1,
882002,butbeforeJuly1,2003,andtotheextentthatamountexceedstheamountactually
89deductedpursuantto26U.S.C.Section168oftheInternalRevenueCodeasamendedbythe
90JobCreationandWorkerAssistanceActof2002;
HB1364 3 91 (8)ForalltaxyearsbeginningonorafterJanuary1,2005,theamountofanyincome
92receivedformilitaryservicewhilethetaxpayerservesinacombatzonewhichisincludedin
93federaladjustedgrossincomeandnototherwiseexcludedtherefrom.Asusedinthissection,
94"combatzone"meansanyareawhichthePresidentoftheUnitedStatesbyExecutiveOrder
95designatesasanareainwhichArmedForcesoftheUnitedStatesareorhaveengagedin
96combat.Serviceisperformedinacombatzoneonlyifperformedonorafterthedate
97designatedbythePresidentbyExecutiveOrderasthedateofthecommencingofcombat
98activitiesinsuchzone,andonorbeforethedatedesignatedbythePresidentbyExecutive
99Orderasthedateoftheterminationofcombatantactivitiesinsuchzone;
100 (9)ForalltaxyearsendingonorafterJuly1,2002,withrespecttoqualifiedproperty
101thatissoldorotherwisedisposedofduringataxableyearbyataxpayerandforwhichan
102additionalmodificationwasmadeundersubdivision(3)ofsubsection2ofthissection,the
103amountbywhichadditionalmodificationmadeundersubdivision(3)ofsubsection2ofthis
104sectiononqualifiedpropertyhasnotbeenrecoveredthroughtheadditionalsubtractions
105providedinsubdivision(7)ofthissubsection;
106 (10)ForalltaxyearsbeginningonorafterJanuary1,2014,theamountofany
107incomereceivedaspaymentfromanyprogramwhichprovidescompensationtoagricultural
108producerswhohavesufferedalossastheresultofadisasteroremergency,includingthe:
109 (a)LivestockForageDisasterProgram;
110 (b)LivestockIndemnityProgram;
111 (c)EmergencyAssistanceforLivestock,Honeybees,andFarm-RaisedFish;
112 (d)EmergencyConservationProgram;
113 (e)NoninsuredCropDisasterAssistanceProgram;
114 (f)Pasture,Rangeland,ForagePilotInsuranceProgram;
115 (g)AnnualForagePilotProgram;
116 (h)LivestockRiskProtectionInsurancePlan;
117 (i)LivestockGrossMarginInsurancePlan;
118 (11)ForalltaxyearsbeginningonorafterJanuary1,2018,anyinterestexpensepaid
119oraccruedinthecurrenttaxableyear,butnotdeductedasaresultofthelimitationimposed
120under26U.S.C.Section163(j),asamended.Forthepurposesofthissubdivision,aninterest
121expenseisconsideredpaidoraccruedonlyinthefirsttaxableyearthedeductionwouldhave
122beenallowableunder26U.S.C.Section163,asamended,ifthelimitationunder26U.S.C.
123Section163(j),asamended,didnotexist;
124 (12)Onehundredpercentofanyretirementbenefitsreceivedbyanytaxpayerasa
125resultofthetaxpayer'sserviceintheArmedForcesoftheUnitedStates,includingreserve
126componentsandtheNationalGuardofthisstate,asdefinedin32U.S.C.Sections101(3)and
127109,andanyothermilitaryforceorganizedunderthelawsofthisstate;[and]
HB1364 4 128 (13)ForalltaxyearsbeginningonorafterJanuary1,2022,onehundredpercentof
129anyfederal,state,orlocalgrantmoneysreceivedbythetaxpayerifthegrantmoneywas
130disbursedfortheexpresspurposeofprovidingorexpandingaccesstobroadbandinternetto
131areasofthestatedeemedtobelackingsuchaccess; and
132 (14)ForalltaxyearsbeginningonorafterJanuary1,2026,onehundred
133percentofanycompensationpaidbyanelectionauthority,thestate,oranyother
134politicalsubdivisionofthestate,toanindividualintheexerciseofhisorherdutiesasan
135electionworkerduringanelectionperiodtoassistwiththeconductofanelection.The
136term"electionworker"shallincludepollworkersandelectionjudgesbutshallnot
137includechallengers,watchers,orpersonsemployedbytheelectionauthorityfull-time
138andreceivingcompensationforsuchfull-timeemployment.Theterm"electionperiod"
139shallmeanthedateofastate,local,orfederalelection,includingprimaryandgeneral
140elections,andshallincludetheperiodforabsenteeorearlyvotingbeforesuchdateand
141anydatespriortoandaftersuchperiodthatanelectionworkerisrequiredtoattend
142electionworkertrainingsormeetings.
143 4.Thereshallbeaddedtoorsubtractedfromthetaxpayer'sfederaladjustedgross
144incomethetaxpayer'sshareoftheMissourifiduciaryadjustmentprovidedinsection143.351.
145 5.Thereshallbeaddedtoorsubtractedfromthetaxpayer'sfederaladjustedgross
146incomethemodificationsprovidedinsection143.411.
147 6.Inadditiontothemodificationstoataxpayer'sfederaladjustedgrossincomeinthis
148section,tocalculateMissouriadjustedgrossincomethereshallbesubtractedfromthe
149taxpayer'sfederaladjustedgrossincomeanygainrecognizedpursuantto26U.S.C.Section
1501033oftheInternalRevenueCodeof1986,asamended,arisingfromcompulsoryor
151involuntaryconversionofpropertyasaresultofcondemnationortheimminencethereof.
152 7.(1)Asusedinthissubsection,"qualifiedhealthinsurancepremium"meansthe
153amountpaidduringthetaxyearbysuchtaxpayerforanyinsurancepolicyprimarily
154providinghealthcarecoverageforthetaxpayer,thetaxpayer'sspouse,orthetaxpayer's
155dependents.
156 (2)Inadditiontothesubtractionsinsubsection3ofthissection,onehundredpercent
157oftheamountofqualifiedhealthinsurancepremiumsshallbesubtractedfromthetaxpayer's
158federaladjustedgrossincometotheextenttheamountpaidforsuchpremiumsisincludedin
159federaltaxableincome.Thetaxpayershallprovidethedepartmentofrevenuewithproofof
160theamountofqualifiedhealthinsurancepremiumspaid.
161 8.(1)BeginningJanuary1,2014,inadditiontothesubtractionsprovidedinthis
162section,onehundredpercentofthecostincurredbyataxpayerforahomeenergyaudit
163conductedbyanentitycertifiedbythedepartmentofnaturalresourcesundersection640.153
164ortheimplementationofanyenergyefficiencyrecommendationsmadeinsuchanauditshall
HB1364 5 165besubtractedfromthetaxpayer'sfederaladjustedgrossincometotheextenttheamountpaid
166foranysuchactivityisincludedinfederaltaxableincome.Thetaxpayershallprovidethe
167departmentofrevenuewithasummaryofanyrecommendationsmadeinaqualifiedhome
168energyaudit,thenameandcertificationnumberofthequalifiedhomeenergyauditorwho
169conductedtheaudit,andproofoftheamountpaidforanyactivitiesunderthissubsectionfor
170whichadeductionisclaimed.Thetaxpayershallalsoprovideacopyofthesummaryofany
171recommendationsmadeinaqualifiedhomeenergyaudittothedepartmentofnatural
172resources.
173 (2)Atnotimeshalladeductionclaimedunderthissubsectionbyanindividual
174taxpayerortaxpayersfilingcombinedreturnsexceedonethousanddollarsperyearfor
175individualtaxpayersorcumulativelyexceedtwothousanddollarsperyearfortaxpayers
176filingcombinedreturns.
177 (3)Anydeductionclaimedunderthissubsectionshallbeclaimedforthetaxyearin
178whichthequalifiedhomeenergyauditwasconductedorinwhichtheimplementationofthe
179energyefficiencyrecommendationsoccurred.Ifimplementationoftheenergyefficiency
180recommendationsoccurredduringmorethanoneyear,thedeductionmaybeclaimedinmore
181thanoneyear,subjecttothelimitationsprovidedundersubdivision(2)ofthissubsection.
182 (4)Adeductionshallnotbeclaimedforanyotherwiseeligibleactivityunderthis
183subsectionifsuchactivityqualifiedforandreceivedanyrebateorotherincentivethrougha
184state-sponsoredenergyprogramorthroughanelectriccorporation,gascorporation,electric
185cooperative,ormunicipallyownedutility.
186 9.Theprovisionsofsubsection8ofthissectionshallexpireonDecember31,2020.
187 10.(1)Asusedinthissubsection,thefollowingtermsmean:
188 (a)"Beginningfarmer",ataxpayerwho:
189 a.HasfiledatleastonebutnotmorethantenInternalRevenueServiceScheduleF
190(Form1040)ProfitorLossFromFarmingformssinceturningeighteenyearsofage;
191 b.IsapprovedforabeginningfarmerloanthroughtheUSDAFarmServiceAgency
192BeginningFarmerdirectorguaranteedloanprogram;
193 c.Hasafarmingoperationthatisdeterminedbythedepartmentofagriculturetobe
194newproductionagriculturebutistheprincipaloperatorofafarmandhassubstantialfarming
195knowledge;or
196 d.Hasbeendeterminedbythedepartmentofagriculturetobeaqualifiedfamily
197member;
198 (b)"Farmowner",anindividualwhoownsfarmlandanddisposesoforrelinquishes
199useofallorsomeportionofsuchfarmlandasfollows:
200 a.Asaletoabeginningfarmer;
201 b.Aleaseorrentalagreementnotexceedingtenyearswithabeginningfarmer;or
HB1364 6 202 c.Acrop-sharearrangementnotexceedingtenyearswithabeginningfarmer;
203 (c)"Qualifiedfamilymember",anindividualwhoisrelatedtoafarmownerwithin
204thefourthdegreebyblood,marriage,oradoptionandwhoispurchasingorleasingorisina
205crop-sharearrangementforlandfromalloraportionofsuchfarmowner'sfarmingoperation.
206 (2)(a)Inadditiontoallothersubtractionsauthorizedinthissection,ataxpayerwho
207isafarmownerwhosellsalloraportionofsuchfarmlandtoabeginningfarmermaysubtract
208fromsuchtaxpayer'sMissouriadjustedgrossincomeanamounttotheextentincludedin
209federaladjustedgrossincomeasprovidedinthissubdivision.
210 (b)Subjecttothelimitationsinparagraph(c)ofthissubdivision,theamountthatmay
211besubtractedshallbeequaltotheportionofcapitalgainsreceivedfromthesaleofsuch
212farmlandthatsuchtaxpayerreceivesinthetaxyearforwhichsuchtaxpayersubtractssuch
213capitalgain.
214 (c)Ataxpayermaysubtractthefollowingamountsandpercentagespertaxyearin
215totalcapitalgainsreceivedfromthesaleofsuchfarmlandunderthissubdivision:
216 a.Forthefirsttwomilliondollarsreceived,onehundredpercent;
217 b.Forthenextonemilliondollarsreceived,eightypercent;
218 c.Forthenextonemilliondollarsreceived,sixtypercent;
219 d.Forthenextonemilliondollarsreceived,fortypercent;and
220 e.Forthenextonemilliondollarsreceived,twentypercent.
221 (d)Thedepartmentofrevenueshallprepareanannualreportreviewingthecostsand
222benefitsandcontainingstatisticalinformationregardingthesubtractionofcapitalgains
223authorizedunderthissubdivisionfortheprevioustaxyearincluding,butnotlimitedto,the
224totalamountofallcapitalgainssubtractedandthenumberoftaxpayerssubtractingsuch
225capitalgains.SuchreportshallbesubmittedbeforeFebruaryfirstofeachyeartothe
226committeeonagriculturepolicyoftheMissourihouseofrepresentativesandthecommittee
227onagriculture,foodproductionandoutdoorresourcesoftheMissourisenate,orthesuccessor
228committees.
229 (3)(a)Inadditiontoallothersubtractionsauthorizedinthissection,ataxpayerwho
230isafarmownerwhoentersaleaseorrentalagreementforalloraportionofsuchfarmland
231withabeginningfarmermaysubtractfromsuchtaxpayer'sMissouriadjustedgrossincomean
232amounttotheextentincludedinfederaladjustedgrossincomeasprovidedinthis
233subdivision.
234 (b)Subjecttothelimitationinparagraph(c)ofthissubdivision,theamountthatmay
235besubtractedshallbeequaltotheportionofcashrentincomereceivedfromtheleaseor
236rentalofsuchfarmlandthatsuchtaxpayerreceivesinthetaxyearforwhichsuchtaxpayer
237subtractssuchincome.
HB1364 7 238 (c)Notaxpayershallsubtractmorethantwenty-fivethousanddollarspertaxyearin
239totalcashrentincomereceivedfromtheleaseorrentalofsuchfarmlandunderthis
240subdivision.
241 (4)(a)Inadditiontoallothersubtractionsauthorizedinthissection,ataxpayerwho
242isafarmownerwhoentersacrop-sharearrangementonalloraportionofsuchfarmlandwith
243abeginningfarmermaysubtractfromsuchtaxpayer'sMissouriadjustedgrossincomean
244amounttotheextentincludedinfederaladjustedgrossincomeasprovidedinthis
245subdivision.
246 (b)Subjecttothelimitationinparagraph(c)ofthissubdivision,theamountthatmay
247besubtractedshallbeequaltotheportionofincomereceivedfromthecrop-share
248arrangementonsuchfarmlandthatsuchtaxpayerreceivesinthetaxyearforwhichsuch
249taxpayersubtractssuchincome.
250 (c)Notaxpayershallsubtractmorethantwenty-fivethousanddollarspertaxyearin
251totalincomereceivedfromtheleaseorrentalofsuchfarmlandunderthissubdivision.
252 (5)Thedepartmentofagricultureshall,byrule,establishaprocesstoverifythata
253taxpayerisabeginningfarmerforpurposesofthissectionandshallprovideverificationto
254thebeginningfarmerandfarmsellerofsuchfarmer'sandseller'scertificationand
255qualificationfortheexemptionprovidedinthissubsection.
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HB1364 8