FIRSTREGULARSESSION
HOUSEBILLNO.426
103RDGENERALASSEMBLY
INTRODUCEDBYREPRESENTATIVEVERNETTI.
1018H.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,and]amaximumofthe
46firstsixthousanddollarsofanyretirementallowancereceivedbyeachtaxpayerfromany
47privatelyfundedsourcesfortaxyearsbeginningonorafterJanuary1,2002, butbefore
48January1,2026. ForalltaxyearsbeginningonorbeforeDecember31,2025,ataxpayer
49shallbeentitledtothemaximumexemptionprovidedbythissubsection:
50 (1)Ifthetaxpayer'sfilingstatusissingle,headofhouseholdorqualifyingwidow(er)
51andthetaxpayer'sMissouriadjustedgrossincomeislessthantwenty-fivethousanddollars;
52or
53 (2)Ifthetaxpayer'sfilingstatusismarriedfilingcombinedandtheircombined
54Missouriadjustedgrossincomeislessthanthirty-twothousanddollars;or
HB426 2 55 (3)Ifthetaxpayer'sfilingstatusismarriedfilingseparatelyandthetaxpayer's
56Missouriadjustedgrossincomeislessthansixteenthousanddollars.
57
58ForalltaxyearsbeginningonorafterJanuary1,2026,thereshallbesubtractedfrom
59Missouriadjustedgrossincome,determinedundersection143.121,onehundred
60percentofanyretirementallowancereceivedbyeachtaxpayerfromanyprivately
61fundedsources.Ataxpayershallbeentitledtotheexemptionprovidedbythis
62subsectionregardlessofthetaxpayer'sfilingstatusortheamountofthetaxpayer's
63Missouriadjustedgrossincome.
64 4.Ifataxpayer'sadjustedgrossincomeexceedstheadjustedgrossincomeceilingfor
65suchtaxpayer'sfilingstatus,asprovidedinsubdivisions(1),(2)and(3)ofsubsection3ofthis
66section,suchtaxpayershallbeentitledtoanexemptionequaltothegreaterofzeroorthe
67maximumexemptionprovidedinsubsection3ofthissectionreducedbyonedollarforevery
68dollarsuchtaxpayer'sincomeexceedstheceilingforhisorherfilingstatus.
69 5.Forpurposesofthissubsection,theterm"maximumSocialSecuritybenefit
70available"shallmeanthirty-twothousandfivehundreddollarsforthetaxyearbeginningon
71orafterJanuary1,2007,andforeachsubsequenttaxyearsuchamountshallbeincreasedby
72thepercentageincreaseintheConsumerPriceIndexforAllUrbanConsumers,orits
73successorindex,assuchindexisdefinedandofficiallyreportedbytheUnitedStates
74DepartmentofLabor,oritssuccessoragency.ForthetaxyearbeginningonorafterJanuary
751,2007,butendingonorbeforeDecember31,2007,thereshallbesubtractedfromMissouri
76adjustedgrossincome,determinedpursuanttosection143.121,amaximumofanamount
77equaltothegreaterof:sixthousanddollarsinretirementbenefitsreceivedfromsourcesother
78thanprivatelyfundedsources,totheextentsuchbenefitsareincludedinthetaxpayer'sfederal
79adjustedgrossincome;ortwentypercentoftheretirementbenefitsreceivedfromsources
80otherthanprivatelyfundedsourcesinthetaxyear,butnottoexceedthemaximumSocial
81Securitybenefitavailableforsuchtaxyear.ForthetaxyearbeginningonorafterJanuary1,
822008,butendingonorbeforeDecember31,2008,thereshallbesubtractedfromMissouri
83adjustedgrossincome,determinedpursuanttosection143.121,amaximumofanamount
84equaltothegreaterof:sixthousanddollarsinretirementbenefitsreceivedfromsourcesother
85thanprivatelyfundedsources,totheextentsuchbenefitsareincludedinthetaxpayer'sfederal
86adjustedgrossincome;orthirty-fivepercentoftheretirementbenefitsreceivedfromsources
87otherthanprivatelyfundedsourcesinthetaxyear,butnottoexceedthemaximumSocial
88Securitybenefitavailableforsuchtaxyear.ForthetaxyearbeginningonorafterJanuary1,
892009,butendingonorbeforeDecember31,2009,thereshallbesubtractedfromMissouri
90adjustedgrossincome,determinedpursuanttosection143.121,amaximumofanamount
91equaltothegreaterof:sixthousanddollarsinretirementbenefitsreceivedfromsourcesother
HB426 3 92thanprivatelyfundedsources,totheextentsuchbenefitsareincludedinthetaxpayer'sfederal
93adjustedgrossincome;orfiftypercentoftheretirementbenefitsreceivedfromsourcesother
94thanprivatelyfundedsourcesinthetaxyear,butnottoexceedthemaximumSocialSecurity
95benefitavailableforsuchtaxyear.ForthetaxyearbeginningonorafterJanuary1,2010,but
96endingonorbeforeDecember31,2010,thereshallbesubtractedfromMissouriadjusted
97grossincome,determinedpursuanttosection143.121,amaximumofanamountequaltothe
98greaterof:sixthousanddollarsinretirementbenefitsreceivedfromsourcesotherthan
99privatelyfundedsources,totheextentsuchbenefitsareincludedinthetaxpayer'sfederal
100adjustedgrossincome;orsixty-fivepercentoftheretirementbenefitsreceivedfromsources
101otherthanprivatelyfundedsourcesinthetaxyear,butnottoexceedthemaximumSocial
102Securitybenefitavailableforsuchtaxyear.ForthetaxyearbeginningonorafterJanuary1,
1032011,butendingonorbeforeDecember31,2011,thereshallbesubtractedfromMissouri
104adjustedgrossincome,determinedpursuanttosection143.121,amaximumofanamount
105equaltothegreaterof:sixthousanddollarsinretirementbenefitsreceivedfromsourcesother
106thanprivatelyfundedsources,totheextentsuchbenefitsareincludedinthetaxpayer'sfederal
107adjustedgrossincome;oreightypercentoftheretirementbenefitsreceivedfromsources
108otherthanprivatelyfundedsourcesinthetaxyear,butnottoexceedthemaximumSocial
109Securitybenefitavailableforsuchtaxyear.ForalltaxyearsbeginningonorafterJanuary1,
1102012,thereshallbesubtractedfromMissouriadjustedgrossincome,determinedpursuantto
111section143.121,amaximumofanamountequaltoonehundredpercentoftheretirement
112benefitsreceivedfromsourcesotherthanprivatelyfundedsourcesinthetaxyear,butnotto
113exceedthemaximumSocialSecuritybenefitavailableforsuchtaxyear.Foralltaxyears
114beginningonorbeforeDecember31,2023,ataxpayershallbeentitledtothemaximum
115exemptionprovidedbythissubsection:
116 (1)Ifthetaxpayer'sfilingstatusismarriedfilingcombined,andtheircombined
117Missouriadjustedgrossincomeisequaltoorlessthanonehundredthousanddollars;or
118 (2)Ifthetaxpayer'sfilingstatusissingle,headofhousehold,qualifyingwidow(er),
119ormarriedfilingseparately,andthetaxpayer'sMissouriadjustedgrossincomeisequaltoor
120lessthaneighty-fivethousanddollars.
121
122ForalltaxyearsbeginningonorafterJanuary1,2024,ataxpayershallbeentitledtothe
123maximumexemptionprovidedbythissubsectionregardlessofthetaxpayer'sfilingstatusor
124theamountofthetaxpayer'sMissouriadjustedgrossincome.
125 6.ForalltaxyearsbeginningonorbeforeDecember31,2023,ifataxpayer's
126adjustedgrossincomeexceedstheadjustedgrossincomeceilingforsuchtaxpayer'sfiling
127status,asprovidedinsubdivisions(1)and(2)ofsubsection5ofthissection,suchtaxpayer
128shallbeentitledtoanexemption,lessanyapplicablereductionprovidedundersubsection7
HB426 4 129ofthissection,equaltothegreaterofzeroorthemaximumexemptionprovidedinsubsection
1305ofthissectionreducedbyonedollarforeverydollarsuchtaxpayer'sincomeexceedsthe
131ceilingforhisorherfilingstatus.
132 7.Forpurposesofcalculatingthesubtractionprovidedinsubsection5ofthissection,
133suchsubtractionshallbedecreasedbyanamountequaltoanySocialSecuritybenefit
134exemptionprovidedundersection143.125.
135 8.Forpurposesofthissection,anySocialSecuritybenefitsotherwiseincludedin
136Missouriadjustedgrossincomeshallbesubtracted;butSocialSecuritybenefitsshallnotbe
137subtractedforpurposesofothercomputationspursuanttothischapter,andarenottobe
138consideredasretirementbenefitsforpurposesofthissection.
139 9.Theprovisionsofsubdivisions(1)and(2)ofsubsection3ofthissectionshall
140applyduringalltaxyearsinwhichthefederalInternalRevenueCodeprovidesexemption
141levelsforcalculationofthetaxabilityofSocialSecuritybenefitsthatarethesameasthe
142levelsinsubdivisions(1)and(2)ofsubsection3ofthissection.Iftheexemptionlevelsfor
143thecalculationofthetaxabilityofSocialSecuritybenefitsareadjustedbyapplicablefederal
144laworregulation,theexemptionlevelsinsubdivisions(1)and(2)ofsubsection3ofthis
145sectionshallbeaccordinglyadjustedtothesameexemptionlevels.
146 10.Theportionofataxpayer'slumpsumdistributionfromanannuityorother
147retirementplannototherwiseincludedinMissouriadjustedgrossincomeascalculated
148pursuanttothischapterbutsubjecttotaxationunderInternalRevenueCodeSection402shall
149betaxedinanamountequaltotenpercentofthetaxpayer'sfederalliabilityonsuch
150distributionforthesametaxyear.
151 11.Forpurposesofthissection,retirementbenefitsreceivedshallnotincludeany
152withdrawalsfromqualifiedretirementplanswhicharesubsequentlyrolledoverintoanother
153retirementplan.
154 12.Theexemptionsprovidedforinthissectionshallnotaffectthecalculationofthe
155incometobeusedtodeterminethepropertytaxcreditprovidedinsections135.010to
156135.035.
157 13.Theexemptionsprovidedforinthissectionshallapplytoanyannuity,pension,or
158retirementallowanceasdefinedinsubsection1ofthissectiontotheextentthatsuchamounts
159areincludedinthetaxpayer'sfederaladjustedgrossincomeandnototherwisedeductedfrom
160thetaxpayer'sfederaladjustedgrossincomeinthecalculationofMissouritaxableincome.
161Thissubsectionshallnotapplytoanyindividualwhoqualifiesunderfederalguidelinestobe
162onehundredpercentdisabled.
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