Minnesota taxpayers may soon get tax rebate checks. On Wednesday, the Democrats agreed on a $3 billion plan to send one-time rebate checks from Minnesota of $260 to 2.5 million residents. In addition to the one-time rebate checks from Minnesota, the deal also includes creating a new tax credit and exempting taxes on Social Security income for some seniors.
One-Time Rebate Checks From Minnesota: Who Could Get Them?
The deal, which was presented late Wednesday night, comes after months of negotiations among Democrats on how to use the record $17.5 billion budget surplus.
Negotiations on how to use the surplus money mainly focused on how much to cut taxes and who should benefit the most from the cut in taxes. Republicans, on the other hand, wanted more of the surplus money to be used for tax cuts.
Democrats have agreed to send $260 in a one-time refundable tax credit to single taxpayers with an annual income of up to $75,000, and $520 to married joint filers with an annual income of up to $150,000. Those with children will get $260 per child (up to three children). It means the maximum rebate that a family could get is $1,300, according to the StarTribune.
A point to note is that a deal to send one-time rebate checks from Minnesota is smaller than what Gov. Tim Walz proposed earlier this session. Gov. Walz proposed sending $1,000 to individuals and $2,000 to married couples.
“It was a proposal we put forward, and we compromised in good faith on this,” Gov. Walz said. “It was a little smaller than we wanted, but there were other things that we got for that trade for children and families.”
What Else Is Included In The Deal?
Apart from the one-time rebate checks from Minnesota, the deal included a version of the governor’s proposal to offer a new child tax credit of $1,750 per dependent. The credit will start to phase out at an annual income of $35,000 for couples.
Additionally, the deal includes a provision that exempts couples with an annual income of up to $100,000 from the state tax on their Social Security income. Moreover, the deal also includes larger tax credits and refunds for renters and homeowners.
Further, there is an $80 million increase in aid for counties and local governments, as well as a $300 million one-time infusion to help them cover public safety costs. Tribal nations will also receive $105 million in new aid over the next four years.
The Democrats’ bill adds about $1 billion in new revenue, and most of it comes from conforming to a federal provision, which taxes profits of companies with operations overseas. The bill also alters itemized deductions for those with higher income.
Republicans have criticized Democrats for not including state sales tax exemptions on baby products, including cribs, strollers and car seats.
The deal now needs to pass both the House and Senate before it is sent to Gov. Walz for final approval.
This article originally appeared on ValueWalk
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