Missouri 2025 Regular Session

Missouri Senate Bill SB458 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1
2	2	EXPLANATION- Matter enclosed in bold-faced brackets [thus] in this bill is not enacted
3	3	and is intended to be omitted in the law.
4	4
5	5	FIRST REGULAR SESSION
6	6	SENATE BILL NO. 458
7	7	103RD GENERAL ASSEMBLY
8	8
9	9	INTRODUCED BY SENATOR SCHNELTING.
10	10	1405S.01I KRISTINA MARTIN, Secretary
11	11	AN ACT
12	12	To repeal sections 143.011, 143.021, and 143.171, RSMo, and to enact in lieu thereof three new
13	13	sections relating to income taxes.
14	14
15	15
16	16	Be it enacted by the General Assembly of the State of Missouri, as follows:
17	17	Section A. Sections 143.011, 143.021, and 143.171, RSMo, 1
18	18	are repealed and three new sections enacted in lieu thereof, to 2
19	19	be known as sections 143.011, 143.021, and 143.171, to read as 3
20	20	follows:4
21	21	143.011. 1. For all tax years beginning on or before 1
22	22	December 31, 2025, a tax is hereby imposed for every taxable 2
23	23	year on the Missouri taxable income of every resident. The 3
24	24	tax shall be determined by applying the tax table or the 4
25	25	rate provided in section 143.021, which is based upon the 5
26	26	following rates: 6
27	27	7
28	28	8
29	29	If the Missouri
30	30	taxable income is:
31	31	The tax is:
32	32	9
33	33	10
34	34	Not over $1,000.00 1 1/2% of the Missouri
35	35	taxable income
36	36
37	37	11
38	38	12
39	39	Over $1,000 but not
40	40	over $2,000
41	41	$15 plus 2% of excess over
42	42	$1,000
43	43
44	44	13
45	45	14
46	46	Over $2,000 but not
47	47	over $3,000
48	48	$35 plus 2 1/2% of excess
49	49	over $2,000
50	50	SB 458 2
51	51	2. (1) Notwithstanding the provisions of subsection 1 29
52	52	of this section to the contrary, beginning with the 2023 30
53	53	calendar year, but ending on or before December 31, 2025, 31
54	54	the top rate of tax pursuant to subsection 1 of this section 32
55	55	shall be four and ninety-five hundredths percent. 33
56	56	(2) The modification of tax rates made pursuant to 34
57	57	this subsection shall apply only to tax years that begin on 35
58	58	or after January 1, 2023, but before January 1, 2026. 36
59	59	(3) The director of the department of revenue shall, 37
60	60	by rule, adjust the tax table provided in subsection 1 of 38
61	61	this section to effectuate the provisions of this 39
62	62	subsection. The top remaining rate of tax shall apply to 40
63	63	all income in excess of seven thousand dollars, as adjusted 41
64	64	pursuant to subsection 5 of this section. 42
65	65	3. (1) [In addition to the rate reduction under 43
66	66	subsection 2 of this section, beginning with the 2024 44
67	67	15
68	68	16
69	69	Over $3,000 but not
70	70	over $4,000
71	71	$60 plus 3% of excess over
72	72	$3,000
73	73
74	74	17
75	75	18
76	76	Over $4,000 but not
77	77	over $5,000
78	78	$90 plus 3 1/2% of excess
79	79	over $4,000
80	80
81	81	19
82	82	20
83	83	Over $5,000 but not
84	84	over $6,000
85	85	$125 plus 4% of excess over
86	86	$5,000
87	87
88	88	21
89	89	22
90	90	Over $6,000 but not
91	91	over $7,000
92	92	$165 plus 4 1/2% of excess
93	93	over $6,000
94	94
95	95	23
96	96	24
97	97	Over $7,000 but not
98	98	over $8,000
99	99	$210 plus 5% of excess over
100	100	$7,000
101	101
102	102	25
103	103	26
104	104	Over $8,000 but not
105	105	over $9,000
106	106	$260 plus 5 1/2% of excess
107	107	over $8,000
108	108
109	109	27
110	110	28
111	111	Over $9,000 $315 plus 6% of excess over
112	112	$9,000
113	113	SB 458 3
114	114	calendar year, the top rate of tax under subsection 1 of 45
115	115	this section may be reduced by fifteen hundredths of a 46
116	116	percent. A reduction in the rate of tax shall take effect 47
117	117	on January first of a calendar year and such reduced rates 48
118	118	shall continue in effect until the next reduction occurs. 49
119	119	(2) A reduction in the rate of tax shall only occur if 50
120	120	the amount of net general revenue collected in the previous 51
121	121	fiscal year exceeds the highest amount of net general 52
122	122	revenue collected in any of the three fiscal years prior to 53
123	123	such fiscal year by at least one hundred seventy-five 54
124	124	million dollars. 55
125	125	(3) Any modification of tax rates under this 56
126	126	subsection shall only apply to tax years that begin on or 57
127	127	after a modification takes effect. 58
128	128	(4) The director of the department of revenue shall, 59
129	129	by rule, adjust the tax tables under subsection 1 of this 60
130	130	section to effectuate the provisions of this subsection. 61
131	131	4. (1) In addition to the rate reductions under 62
132	132	subsections 2 and 3 of this section, beginning with the 63
133	133	calendar year immediately following the calendar year in 64
134	134	which a reduction is made pursuant to subsection 3 of this 65
135	135	section, the top rate of tax under subsection 1 of this 66
136	136	section may be further reduced over a period of years. Each 67
137	137	reduction in the top rate of tax shall be by one-tenth of a 68
138	138	percent and no more than one reduction shall occur in a 69
139	139	calendar year. No more than three reductions shall be made 70
140	140	under this subsection. Reductions in the rate of tax shall 71
141	141	take effect on January first of a calendar year and such 72
142	142	reduced rates shall continue in effect until the next 73
143	143	reduction occurs. 74
144	144	(2) (a) A reduction in the rate of tax shall only 75
145	145	occur if: 76 SB 458 4
146	146	a. The amount of net general revenue collected in the 77
147	147	previous fiscal year exceeds the highest amount of net 78
148	148	general revenue collected in any of the three fiscal years 79
149	149	prior to such fiscal year by at least two hundred million 80
150	150	dollars; and 81
151	151	b. The amount of net general revenue collected in the 82
152	152	previous fiscal year exceeds the amount of net general 83
153	153	revenue collected in the fiscal year five years prior, 84
154	154	adjusted annually by the percentage increase in inflation 85
155	155	over the preceding five fiscal years. 86
156	156	(b) The amount of net general revenue collected 87
157	157	required by subparagraph a. of paragraph (a) of this 88
158	158	subdivision in order to make a reduction pursuant to this 89
159	159	subsection shall be adjusted annually by the percent 90
160	160	increase in inflation beginning with January 2, 2023. 91
161	161	(3) Any modification of tax rates under this 92
162	162	subsection shall only apply to tax years that begin on or 93
163	163	after a modification takes effect. 94
164	164	(4) The director of the department of revenue shall, 95
165	165	by rule, adjust the tax tables under subsection 1 of this 96
166	166	section to effectuate the provisions of this subsection. 97
167	167	The bracket for income subject to the top rate of tax shall 98
168	168	be eliminated once the top rate of tax has been reduced 99
169	169	below the rate applicable to such bracket, and the top 100
170	170	remaining rate of tax shall apply to all income in excess of 101
171	171	the income in the second highest remaining income bracket.] 102
172	172	For all tax years beginning on or after January 1, 2026, a 103
173	173	tax of four percent is hereby imposed on the Missouri 104
174	174	taxable income of every resident of this state. The tax 105
175	175	shall be determined by the application of the income 106
176	176	provisions provided under section 143.021. 107 SB 458 5
177	177	(2) The department of revenue shall, by rule and by 108
178	178	posting on the department's website, adjust the appropriate 109
179	179	tax rate to effectuate the provisions of this subsection. 110
180	180	4. (1) Upon adoption of a constitutional amendment 111
181	181	authorizing the creation of the tax reform fund, in addition 112
182	182	to the rate reductions made pursuant to subsection 3 of this 113
183	183	section, beginning with the 2027 calendar year, the tax rate 114
184	184	imposed pursuant to subsection 3 of this section may be 115
185	185	reduced over a period of years pursuant to subdivision (2) 116
186	186	of this subsection. A reduction in the rate of tax shall 117
187	187	take effect on January first of the immediately succeeding 118
188	188	calendar year and such reduced rate shall continue in effect 119
189	189	until the next reduction occurs. 120
190	190	(2) A reduction in the rate of tax shall occur if the 121
191	191	amount of net general revenue collected in the immediately 122
192	192	previous fiscal year exceeds anticipated general fund 123
193	193	revenue expenditures for such fiscal year by at least one 124
194	194	million dollars and the minimum balance in the tax reform 125
195	195	fund is at least one hundred twenty million dollars at the 126
196	196	close of the fiscal year. The amount of the reduction shall 127
197	197	be calculated as follows: 128
198	198	(a) For the first one hundred twenty million dollars 129
199	199	in the tax reform fund, one-tenth of one percent; plus 130
200	200	(b) For each additional sixty million dollars in 131
201	201	excess of the minimum balance, one-twentieth of one percent. 132
202	202	(3) Any modification of the tax rate made pursuant to 133
203	203	this subsection shall apply only to tax years that begin on 134
204	204	or after the date a modification takes effect. 135
205	205	(4) The director of the department of revenue shall 136
206	206	adjust and publish the tax rate as adjusted pursuant to this 137
207	207	subsection to effectuate the provisions of this subsection. 138 SB 458 6
208	208	5. Beginning with the 2017 calendar year, and ending 139
209	209	on or before December 31, 2025, the brackets of Missouri 140
210	210	taxable income identified in subsection 1 of this section 141
211	211	shall be adjusted annually by the percent increase in 142
212	212	inflation. The director shall publish such brackets 143
213	213	annually beginning on or after October 1, 2016. 144
214	214	Modifications to the brackets shall take effect on January 145
215	215	first of each calendar year and shall apply to tax years 146
216	216	beginning on or after the effective date of the new brackets. 147
217	217	6. As used in this section, the following terms mean: 148
218	218	(1) "CPI", the Consumer Price Index for All Urban 149
219	219	Consumers for the United States as reported by the Bureau of 150
220	220	Labor Statistics, or its successor index; 151
221	221	(2) "CPI for the preceding calendar year", the average 152
222	222	of the CPI as of the close of the twelve-month period ending 153
223	223	on August thirty-first of such calendar year; 154
224	224	(3) "Net general revenue collected", all revenue 155
225	225	deposited into the general revenue fund, less refunds and 156
226	226	revenues originally deposited into the general revenue fund 157
227	227	but designated by law for a specific distribution or 158
228	228	transfer to another state fund; 159
229	229	(4) "Percent increase in inflation", the percentage, 160
230	230	if any, by which the CPI for the preceding calendar year 161
231	231	exceeds the CPI for the year beginning September 1, 2014, 162
232	232	and ending August 31, 2015. 163
233	233	143.021. 1. Every resident having a taxable income 1
234	234	shall determine his or her tax from the rates provided in 2
235	235	section 143.011. For all tax years beginning on or before 3
236	236	December 31, 2022, there shall be no tax on a taxable income 4
237	237	of less than one hundred dollars. 5
238	238	2. (1) Notwithstanding the provisions of subsection 1 6
239	239	of section 143.011 to the contrary, for all tax years 7 SB 458 7
240	240	beginning on or after January 1, 2023, but on or before 8
241	241	December 31, 2025, there shall be no tax on taxable income 9
242	242	of less than or equal to one thousand dollars, as adjusted 10
243	243	pursuant to subsection 5 of section 143.011. 11
244	244	(2) The modifications made pursuant to this subsection 12
245	245	shall only apply to tax years that begin on or after January 13
246	246	1, 2023, but on or before December 31, 2025. 14
247	247	(3) The director of the department of revenue shall, 15
248	248	by rule, adjust the tax table provided in subsection 1 of 16
249	249	section 143.011 to effectuate the provisions of this 17
250	250	subsection. 18
251	251	3. Notwithstanding the provisions of subsection 3 of 19
252	252	section 143.011 to the contrary, for all tax years beginning 20
253	253	on or after January 1, 2026, there shall be no tax on 21
254	254	taxable income of less than or equal to one thousand dollars. 22
255	255	143.171. 1. For all tax years beginning on or after 1
256	256	January 1, 1994, and ending on or before December 31, 2018, 2
257	257	an individual taxpayer shall be allowed a deduction for his 3
258	258	or her federal income tax liability under Chapter 1 of the 4
259	259	Internal Revenue Code for the same taxable year for which 5
260	260	the Missouri return is being filed, not to exceed five 6
261	261	thousand dollars on a single taxpayer's return or ten 7
262	262	thousand dollars on a combined return, after reduction for 8
263	263	all credits thereon, except the credit for payments of 9
264	264	federal estimated tax, the credit for the overpayment of any 10
265	265	federal tax, and the credits allowed by the Internal Revenue 11
266	266	Code by 26 U.S.C. Section 31, 26 U.S.C. Section 27, and 26 12
267	267	U.S.C. Section 34. 13
268	268	2. (1) Notwithstanding any other provision of law to 14
269	269	the contrary, for all tax years beginning on or after 15
270	270	January 1, 2019, but on or before December 31, 2025, an 16
271	271	individual taxpayer shall be allowed a deduction equal to a 17 SB 458 8
272	272	percentage of his or her federal income tax liability under 18
273	273	Chapter 1 of the Internal Revenue Code for the same taxable 19
274	274	year for which the Missouri return is being filed, not to 20
275	275	exceed five thousand dollars on a single taxpayer's return 21
276	276	or ten thousand dollars on a combined return, after 22
277	277	reduction for all credits thereon, except the credit for 23
278	278	payments of federal estimated tax, the credit for the 24
279	279	overpayment of any federal tax, and the credits allowed by 25
280	280	the Internal Revenue Code by 26 U.S.C. Section 31, 26 U.S.C. 26
281	281	Section 27, and 26 U.S.C. Section 34. The deduction 27
282	282	percentage is determined according to the following table: 28
283	283	(2) Notwithstanding any provision of law to the 36
284	284	contrary, the amount of any tax credits reducing a 37
285	285	taxpayer's federal tax liability pursuant to Public Law 116- 38
286	286	136 or 116-260, enacted by the 116th United States Congress, 39
287	287	for the tax year beginning on or after January 1, 2020, and 40
288	288	ending on or before December 31, 2020, and the amount of any 41
289	289	tax credits reducing a taxpayer's federal tax liability 42
290	290	under any other federal law that provides direct economic 43
291	291	impact payments to taxpayers to mitigate financial 44
292	292	challenges related to the COVID-19 pandemic shall not be 45
293	293	29
294	294	30
295	295	If the Missouri gross income
296	296	on the return is:
297	297	The deduction
298	298	percentage is:
299	299
300	300	31 $25,000 or less 35 percent
301	301	32 From $25,001 to $50,000 25 percent
302	302	33 From $50,001 to $100,000 15 percent
303	303	34 From $100,001 to $125,000 5 percent
304	304	35 $125,001 or more 0 percent SB 458 9
305	305	considered in determining a taxpayer's federal tax liability 46
306	306	for the purposes of subdivision (1) of this subsection. 47
307	307	3. For all tax years beginning on or after September 48
308	308	1, 1993, but on or before December 31, 2025, a corporate 49
309	309	taxpayer shall be allowed a deduction for fifty percent of 50
310	310	its federal income tax liability under Chapter 1 of the 51
311	311	Internal Revenue Code for the same taxable year for which 52
312	312	the Missouri return is being filed after reduction for all 53
313	313	credits thereon, except the credit for payments of federal 54
314	314	estimated tax, the credit for the overpayment of any federal 55
315	315	tax, and the credits allowed by the Internal Revenue Code by 56
316	316	26 U.S.C. Section 31, 26 U.S.C. Section 27, and 26 U.S.C. 57
317	317	Section 34. 58
318	318	4. For all tax years beginning on or before December 59
319	319	31, 2025, if a federal income tax liability for a tax year 60
320	320	prior to the applicability of sections 143.011 to 143.996 61
321	321	for which he or she was not previously entitled to a 62
322	322	Missouri deduction is later paid or accrued, he or she may 63
323	323	deduct the federal tax in the later year to the extent it 64
324	324	would have been deductible if paid or accrued in the prior 65
325	325	year. 66
326	326	5. For all tax years beginning on or after January 1, 67
327	327	2026, there shall be no federal income tax deduction for any 68
328	328	individual or corporate taxpayer under this section. 69
329	329	