Missouri 2025 Regular Session

Missouri Senate Bill SB682 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	FIRST REGULAR SESSION
5	5	SENATE BILL NO. 682
6	6	103RD GENERAL ASSEMBLY
7	7	INTRODUCED BY SENATOR HUDSON.
8	8	2762S.01I KRISTINA MARTIN, Secretary
9	9	AN ACT
10	10	To repeal section 143.121, RSMo, and to enact in lieu thereof one new section relating to an
11	11	income tax deduction for certain farmers.
12	12
13	13	Be it enacted by the General Assembly of the State of Missouri, as follows:
14	14	Section A. Section 143.121, RSMo, is repealed and one new 1
15	15	section enacted in lieu thereof, to be known as section 143.121, 2
16	16	to read as follows:3
17	17	143.121. 1. The Missouri adjusted gross income of a 1
18	18	resident individual shall be the taxpayer's federal adjusted 2
19	19	gross income subject to the modifications in this section. 3
20	20	2. There shall be added to the taxpayer's federal 4
21	21	adjusted gross income: 5
22	22	(1) The amount of any federal income tax refund 6
23	23	received for a prior year which resulted in a Missouri 7
24	24	income tax benefit. The amount added pursuant to this 8
25	25	subdivision shall not include any amount of a federal income 9
26	26	tax refund attributable to a tax cred it reducing a 10
27	27	taxpayer's federal tax liability pursuant to Public Law 116 - 11
28	28	136 or 116-260, enacted by the 116th United States Congress, 12
29	29	for the tax year beginning on or after January 1, 2020, and 13
30	30	ending on or before December 31, 2020, and deducted from 14
31	31	Missouri adjusted gross income pursuant to section 143.171. 15
32	32	The amount added under this subdivision shall also not 16
33	33	include any amount of a federal income tax refund 17
34	34	attributable to a tax credit reducing a taxpayer's federal 18 SB 682 2
35	35	tax liability under any ot her federal law that provides 19
36	36	direct economic impact payments to taxpayers to mitigate 20
37	37	financial challenges related to the COVID -19 pandemic, and 21
38	38	deducted from Missouri adjusted gross income under section 22
39	39	143.171; 23
40	40	(2) Interest on certain governme ntal obligations 24
41	41	excluded from federal gross income by 26 U.S.C. Section 103 25
42	42	of the Internal Revenue Code, as amended. The previous 26
43	43	sentence shall not apply to interest on obligations of the 27
44	44	state of Missouri or any of its political subdivisions or 28
45	45	authorities and shall not apply to the interest described in 29
46	46	subdivision (1) of subsection 3 of this section. The amount 30
47	47	added pursuant to this subdivision shall be reduced by the 31
48	48	amounts applicable to such interest that would have been 32
49	49	deductible in computing the taxable income of the taxpayer 33
50	50	except only for the application of 26 U.S.C. Section 265 of 34
51	51	the Internal Revenue Code, as amended. The reduction shall 35
52	52	only be made if it is at least five hundred dollars; 36
53	53	(3) The amount of any deductio n that is included in 37
54	54	the computation of federal taxable income pursuant to 26 38
55	55	U.S.C. Section 168 of the Internal Revenue Code as amended 39
56	56	by the Job Creation and Worker Assistance Act of 2002 to the 40
57	57	extent the amount deducted relates to property purcha sed on 41
58	58	or after July 1, 2002, but before July 1, 2003, and to the 42
59	59	extent the amount deducted exceeds the amount that would 43
60	60	have been deductible pursuant to 26 U.S.C. Section 168 of 44
61	61	the Internal Revenue Code of 1986 as in effect on January 1, 45
62	62	2002; 46
63	63	(4) The amount of any deduction that is included in 47
64	64	the computation of federal taxable income for net operating 48
65	65	loss allowed by 26 U.S.C. Section 172 of the Internal 49
66	66	Revenue Code of 1986, as amended, other than the deduction 50 SB 682 3
67	67	allowed by 26 U.S.C. Sec tion 172(b)(1)(G) and 26 U.S.C. 51
68	68	Section 172(i) of the Internal Revenue Code of 1986, as 52
69	69	amended, for a net operating loss the taxpayer claims in the 53
70	70	tax year in which the net operating loss occurred or carries 54
71	71	forward for a period of more than twenty y ears and carries 55
72	72	backward for more than two years. Any amount of net 56
73	73	operating loss taken against federal taxable income but 57
74	74	disallowed for Missouri income tax purposes pursuant to this 58
75	75	subdivision after June 18, 2002, may be carried forward and 59
76	76	taken against any income on the Missouri income tax return 60
77	77	for a period of not more than twenty years from the year of 61
78	78	the initial loss; and 62
79	79	(5) For nonresident individuals in all taxable years 63
80	80	ending on or after December 31, 2006, the amount of any 64
81	81	property taxes paid to another state or a political 65
82	82	subdivision of another state for which a deduction was 66
83	83	allowed on such nonresident's federal return in the taxable 67
84	84	year unless such state, political subdivision of a state, or 68
85	85	the District of Columbia allows a subtraction from income 69
86	86	for property taxes paid to this state for purposes of 70
87	87	calculating income for the income tax for such state, 71
88	88	political subdivision of a state, or the District of 72
89	89	Columbia; 73
90	90	(6) For all tax years beginning on or aft er January 1, 74
91	91	2018, any interest expense paid or accrued in a previous 75
92	92	taxable year, but allowed as a deduction under 26 U.S.C. 76
93	93	Section 163, as amended, in the current taxable year by 77
94	94	reason of the carryforward of disallowed business interest 78
95	95	provisions of 26 U.S.C. Section 163(j), as amended. For the 79
96	96	purposes of this subdivision, an interest expense is 80
97	97	considered paid or accrued only in the first taxable year 81
98	98	the deduction would have been allowable under 26 U.S.C. 82 SB 682 4
99	99	Section 163, as amended, if the limitation under 26 U.S.C. 83
100	100	Section 163(j), as amended, did not exist. 84
101	101	3. There shall be subtracted from the taxpayer's 85
102	102	federal adjusted gross income the following amounts to the 86
103	103	extent included in federal adjusted gross income: 87
104	104	(1) Interest received on deposits held at a federal 88
105	105	reserve bank or interest or dividends on obligations of the 89
106	106	United States and its territories and possessions or of any 90
107	107	authority, commission or instrumentality of the United 91
108	108	States to the extent exempt from Misso uri income taxes 92
109	109	pursuant to the laws of the United States. The amount 93
110	110	subtracted pursuant to this subdivision shall be reduced by 94
111	111	any interest on indebtedness incurred to carry the described 95
112	112	obligations or securities and by any expenses incurred in 96
113	113	the production of interest or dividend income described in 97
114	114	this subdivision. The reduction in the previous sentence 98
115	115	shall only apply to the extent that such expenses including 99
116	116	amortizable bond premiums are deducted in determining the 100
117	117	taxpayer's federal adjusted gross income or included in the 101
118	118	taxpayer's Missouri itemized deduction. The reduction shall 102
119	119	only be made if the expenses total at least five hundred 103
120	120	dollars; 104
121	121	(2) The portion of any gain, from the sale or other 105
122	122	disposition of property having a higher adjusted basis to 106
123	123	the taxpayer for Missouri income tax purposes than for 107
124	124	federal income tax purposes on December 31, 1972, that does 108
125	125	not exceed such difference in basis. If a gain is 109
126	126	considered a long-term capital gain for federal inco me tax 110
127	127	purposes, the modification shall be limited to one -half of 111
128	128	such portion of the gain; 112
129	129	(3) The amount necessary to prevent the taxation 113
130	130	pursuant to this chapter of any annuity or other amount of 114 SB 682 5
131	131	income or gain which was properly included in income or gain 115
132	132	and was taxed pursuant to the laws of Missouri for a taxable 116
133	133	year prior to January 1, 1973, to the taxpayer, or to a 117
134	134	decedent by reason of whose death the taxpayer acquired the 118
135	135	right to receive the income or gain, or to a trust or estate 119
136	136	from which the taxpayer received the income or gain; 120
137	137	(4) Accumulation distributions received by a taxpayer 121
138	138	as a beneficiary of a trust to the extent that the same are 122
139	139	included in federal adjusted gross income; 123
140	140	(5) The amount of any state in come tax refund for a 124
141	141	prior year which was included in the federal adjusted gross 125
142	142	income; 126
143	143	(6) The portion of capital gain specified in section 127
144	144	135.357 that would otherwise be included in federal adjusted 128
145	145	gross income; 129
146	146	(7) The amount that would have been deducted in the 130
147	147	computation of federal taxable income pursuant to 26 U.S.C. 131
148	148	Section 168 of the Internal Revenue Code as in effect on 132
149	149	January 1, 2002, to the extent that amount relates to 133
150	150	property purchased on or after July 1, 2002, but be fore July 134
151	151	1, 2003, and to the extent that amount exceeds the amount 135
152	152	actually deducted pursuant to 26 U.S.C. Section 168 of the 136
153	153	Internal Revenue Code as amended by the Job Creation and 137
154	154	Worker Assistance Act of 2002; 138
155	155	(8) For all tax years beginning on or after January 1, 139
156	156	2005, the amount of any income received for military service 140
157	157	while the taxpayer serves in a combat zone which is included 141
158	158	in federal adjusted gross income and not otherwise excluded 142
159	159	therefrom. As used in this section, "combat z one" means any 143
160	160	area which the President of the United States by Executive 144
161	161	Order designates as an area in which Armed Forces of the 145
162	162	United States are or have engaged in combat. Service is 146 SB 682 6
163	163	performed in a combat zone only if performed on or after the 147
164	164	date designated by the President by Executive Order as the 148
165	165	date of the commencing of combat activities in such zone, 149
166	166	and on or before the date designated by the President by 150
167	167	Executive Order as the date of the termination of combatant 151
168	168	activities in such z one; 152
169	169	(9) For all tax years ending on or after July 1, 2002, 153
170	170	with respect to qualified property that is sold or otherwise 154
171	171	disposed of during a taxable year by a taxpayer and for 155
172	172	which an additional modification was made under subdivision 156
173	173	(3) of subsection 2 of this section, the amount by which 157
174	174	additional modification made under subdivision (3) of 158
175	175	subsection 2 of this section on qualified property has not 159
176	176	been recovered through the additional subtractions provided 160
177	177	in subdivision (7) of this subs ection; 161
178	178	(10) For all tax years beginning on or after January 162
179	179	1, 2014, the amount of any income received as payment from 163
180	180	any program which provides compensation to agricultural 164
181	181	producers who have suffered a loss as the result of a 165
182	182	disaster or emergency, including the: 166
183	183	(a) Livestock Forage Disaster Program; 167
184	184	(b) Livestock Indemnity Program; 168
185	185	(c) Emergency Assistance for Livestock, Honeybees, and 169
186	186	Farm-Raised Fish; 170
187	187	(d) Emergency Conservation Program; 171
188	188	(e) Noninsured Crop Disaster Assistance Program; 172
189	189	(f) Pasture, Rangeland, Forage Pilot Insurance Program; 173
190	190	(g) Annual Forage Pilot Program; 174
191	191	(h) Livestock Risk Protection Insurance Plan; 175
192	192	(i) Livestock Gross Margin Insurance Plan; 176
193	193	(11) For all tax years beginning on or after January 177
194	194	1, 2018, any interest expense paid or accrued in the current 178 SB 682 7
195	195	taxable year, but not deducted as a result of the limitation 179
196	196	imposed under 26 U.S.C. Section 163(j), as amended. For the 180
197	197	purposes of this subdivision, an inte rest expense is 181
198	198	considered paid or accrued only in the first taxable year 182
199	199	the deduction would have been allowable under 26 U.S.C. 183
200	200	Section 163, as amended, if the limitation under 26 U.S.C. 184
201	201	Section 163(j), as amended, did not exist; 185
202	202	(12) One hundred percent of any retirement benefits 186
203	203	received by any taxpayer as a result of the taxpayer's 187
204	204	service in the Armed Forces of the United States, including 188
205	205	reserve components and the National Guard of this state, as 189
206	206	defined in 32 U.S.C. Sections 101(3) an d 109, and any other 190
207	207	military force organized under the laws of this state; and 191
208	208	(13) For all tax years beginning on or after January 192
209	209	1, 2022, one hundred percent of any federal, state, or local 193
210	210	grant moneys received by the taxpayer if the grant mo ney was 194
211	211	disbursed for the express purpose of providing or expanding 195
212	212	access to broadband internet to areas of the state deemed to 196
213	213	be lacking such access. 197
214	214	4. There shall be added to or subtracted from the 198
215	215	taxpayer's federal adjusted gross income th e taxpayer's 199
216	216	share of the Missouri fiduciary adjustment provided in 200
217	217	section 143.351. 201
218	218	5. There shall be added to or subtracted from the 202
219	219	taxpayer's federal adjusted gross income the modifications 203
220	220	provided in section 143.411. 204
221	221	6. In addition to the modifications to a taxpayer's 205
222	222	federal adjusted gross income in this section, to calculate 206
223	223	Missouri adjusted gross income there shall be subtracted 207
224	224	from the taxpayer's federal adjusted gross income any gain 208
225	225	recognized pursuant to 26 U.S.C. Section 1033 of the 209
226	226	Internal Revenue Code of 1986, as amended, arising from 210 SB 682 8
227	227	compulsory or involuntary conversion of property as a result 211
228	228	of condemnation or the imminence thereof. 212
229	229	7. (1) As used in this subsection, "qualified health 213
230	230	insurance premium" me ans the amount paid during the tax year 214
231	231	by such taxpayer for any insurance policy primarily 215
232	232	providing health care coverage for the taxpayer, the 216
233	233	taxpayer's spouse, or the taxpayer's dependents. 217
234	234	(2) In addition to the subtractions in subsection 3 o f 218
235	235	this section, one hundred percent of the amount of qualified 219
236	236	health insurance premiums shall be subtracted from the 220
237	237	taxpayer's federal adjusted gross income to the extent the 221
238	238	amount paid for such premiums is included in federal taxable 222
239	239	income. The taxpayer shall provide the department of 223
240	240	revenue with proof of the amount of qualified health 224
241	241	insurance premiums paid. 225
242	242	8. (1) Beginning January 1, 2014, in addition to the 226
243	243	subtractions provided in this section, one hundred percent 227
244	244	of the cost incurred by a taxpayer for a home energy audit 228
245	245	conducted by an entity certified by the department of 229
246	246	natural resources under section 640.153 or the 230
247	247	implementation of any energy efficiency recommendations made 231
248	248	in such an audit shall be subtracted from the taxpayer's 232
249	249	federal adjusted gross income to the extent the amount paid 233
250	250	for any such activity is included in federal taxable 234
251	251	income. The taxpayer shall provide the department of 235
252	252	revenue with a summary of any recommendations made in a 236
253	253	qualified home energy audit, the name and certification 237
254	254	number of the qualified home energy auditor who conducted 238
255	255	the audit, and proof of the amount paid for any activities 239
256	256	under this subsection for which a deduction is claimed. The 240
257	257	taxpayer shall also provide a copy of the summary of any 241 SB 682 9
258	258	recommendations made in a qualified home energy audit to the 242
259	259	department of natural resources. 243
260	260	(2) At no time shall a deduction claimed under this 244
261	261	subsection by an individual taxpayer or taxpayers filing 245
262	262	combined returns exc eed one thousand dollars per year for 246
263	263	individual taxpayers or cumulatively exceed two thousand 247
264	264	dollars per year for taxpayers filing combined returns. 248
265	265	(3) Any deduction claimed under this subsection shall 249
266	266	be claimed for the tax year in which the q ualified home 250
267	267	energy audit was conducted or in which the implementation of 251
268	268	the energy efficiency recommendations occurred. If 252
269	269	implementation of the energy efficiency recommendations 253
270	270	occurred during more than one year, the deduction may be 254
271	271	claimed in more than one year, subject to the limitations 255
272	272	provided under subdivision (2) of this subsection. 256
273	273	(4) A deduction shall not be claimed for any otherwise 257
274	274	eligible activity under this subsection if such activity 258
275	275	qualified for and received any rebate or other incentive 259
276	276	through a state-sponsored energy program or through an 260
277	277	electric corporation, gas corporation, electric cooperative, 261
278	278	or municipally owned utility. 262
279	279	9. The provisions of subsection 8 of this section 263
280	280	shall expire on December 31, 2 020. 264
281	281	10. (1) As used in this subsection, the following 265
282	282	terms mean: 266
283	283	(a) "Beginning farmer", a taxpayer who: 267
284	284	a. Has filed at least one but not more than ten 268
285	285	Internal Revenue Service Schedule F (Form 1040) Profit or 269
286	286	Loss From Farming for ms since turning eighteen years of age; 270
287	287	b. Is approved for a beginning farmer loan through the 271
288	288	USDA Farm Service Agency Beginning Farmer direct or 272
289	289	guaranteed loan program; 273 SB 682 10
290	290	c. Has a farming operation that is determined by the 274
291	291	department of agriculture to be new production agriculture 275
292	292	but is the principal operator of a farm and has substantial 276
293	293	farming knowledge; or 277
294	294	d. Has been determined by the department of 278
295	295	agriculture to be a qualified family member; 279
296	296	(b) "Farm owner", [an individual] a taxpayer who owns 280
297	297	farmland and disposes of or relinquishes use of all or some 281
298	298	portion of such farmland as follows: 282
299	299	a. A sale to a beginning farmer; 283
300	300	b. A lease or rental agreement not exceeding ten years 284
301	301	with a beginning farmer; or 285
302	302	c. A crop-share arrangement not exceeding ten years 286
303	303	with a beginning farmer; 287
304	304	(c) "Qualified family member", an individual who is 288
305	305	related to a farm owner within the fourth degree by blood, 289
306	306	marriage, or adoption and who is purchasing or leasing or is 290
307	307	in a crop-share arrangement for land from all or a portion 291
308	308	of such farm owner's farming operation ; 292
309	309	(d) "Taxpayer", any individual, firm, partner in a 293
310	310	firm, corporation, partnership, shareholder in an S 294
311	311	corporation, or member of a limited l iability company 295
312	312	subject to the income tax imposed under this chapter, 296
313	313	excluding withholding tax imposed under sections 143.191 to 297
314	314	143.265. 298
315	315	(2) (a) In addition to all other subtractions 299
316	316	authorized in this section, a taxpayer who is a farm owner 300
317	317	who sells all or a portion of such farmland to a beginning 301
318	318	farmer may subtract from such taxpayer's Missouri adjusted 302
319	319	gross income an amount to the extent included in federal 303
320	320	adjusted gross income as provided in this subdivision. 304 SB 682 11
321	321	(b) Subject to the limitations in paragraph (c) of 305
322	322	this subdivision, the amount that may be subtracted shall be 306
323	323	equal to the portion of capital gains received from the sale 307
324	324	of such farmland that such taxpayer receives in the tax year 308
325	325	for which such taxpayer subtracts such capital gain. 309
326	326	(c) A taxpayer may subtract the following amounts and 310
327	327	percentages per tax year in total capital gains received 311
328	328	from the sale of such farmland under this subdivision: 312
329	329	a. For the first two million dollars received, one 313
330	330	hundred percent; 314
331	331	b. For the next one million dollars received, eighty 315
332	332	percent; 316
333	333	c. For the next one million dollars received, sixty 317
334	334	percent; 318
335	335	d. For the next one million dollars received, forty 319
336	336	percent; and 320
337	337	e. For the next one million d ollars received, twenty 321
338	338	percent. 322
339	339	(d) The department of revenue shall prepare an annual 323
340	340	report reviewing the costs and benefits and containing 324
341	341	statistical information regarding the subtraction of capital 325
342	342	gains authorized under this subdivision for the previous tax 326
343	343	year including, but not limited to, the total amount of all 327
344	344	capital gains subtracted and the number of taxpayers 328
345	345	subtracting such capital gains. Such report shall be 329
346	346	submitted before February first of each year to the 330
347	347	committee on agriculture policy of the Missouri house of 331
348	348	representatives and the committee on agriculture, food 332
349	349	production and outdoor resources of the Missouri senate, or 333
350	350	the successor committees. 334
351	351	(3) (a) In addition to all other subtractions 335
352	352	authorized in this section, a taxpayer who is a farm owner 336 SB 682 12
353	353	who enters a lease or rental agreement for all or a portion 337
354	354	of such farmland with a beginning farmer may subtract from 338
355	355	such taxpayer's Missouri adjusted gross income an amount to 339
356	356	the extent included in federa l adjusted gross income as 340
357	357	provided in this subdivision. 341
358	358	(b) Subject to the limitation in paragraph (c) of this 342
359	359	subdivision, the amount that may be subtracted shall be 343
360	360	equal to the portion of cash rent income received from the 344
361	361	lease or rental of such farmland that such taxpayer receives 345
362	362	in the tax year for which such taxpayer subtracts such 346
363	363	income. 347
364	364	(c) No taxpayer shall subtract more than twenty -five 348
365	365	thousand dollars per tax year in total cash rent income 349
366	366	received from the lease or renta l of such farmland under 350
367	367	this subdivision. 351
368	368	(4) (a) In addition to all other subtractions 352
369	369	authorized in this section, a taxpayer who is a farm owner 353
370	370	who enters a crop-share arrangement on all or a portion of 354
371	371	such farmland with a beginning farmer may subtract from such 355
372	372	taxpayer's Missouri adjusted gross income an amount to the 356
373	373	extent included in federal adjusted gross income as provided 357
374	374	in this subdivision. 358
375	375	(b) Subject to the limitation in paragraph (c) of this 359
376	376	subdivision, the amount tha t may be subtracted shall be 360
377	377	equal to the portion of income received from the crop -share 361
378	378	arrangement on such farmland that such taxpayer receives in 362
379	379	the tax year for which such taxpayer subtracts such income. 363
380	380	(c) No taxpayer shall subtract more th an twenty-five 364
381	381	thousand dollars per tax year in total income received from 365
382	382	the lease or rental of such farmland under this subdivision. 366
383	383	(5) The department of agriculture shall, by rule, 367
384	384	establish a process to verify that a taxpayer is a beginning 368 SB 682 13
385	385	farmer for purposes of this section and shall provide 369
386	386	verification to the beginning farmer and farm seller of such 370
387	387	farmer's and seller's certification and qualification for 371
388	388	the exemption provided in this subsection. 372
389	389	