1.1 	A bill for an act
1.2 	relating to taxes; individual income; adjusting alternative minimum tax 
1.3 	exemption amounts and phaseout thresholds for inflation;amending Minnesota 
1.4 	Statutes 2004, section 290.091, subdivision 3.
1.5 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.6 	Section 1. Minnesota Statutes 2004, section 290.091, subdivision 3, is amended to read:
1.7 		Subd. 3.Exemption amount. (a) For purposes of computing the alternative 
1.8 	minimum tax, the exemption amount is the exemption determined under section 55(d) 
1.9 	of the Internal Revenue Code, as amended through December 31, 1992, except that 
1.10 	alternative minimum taxable income as determined under this section must be substituted 
1.11 	in the computation of the phase out under section 55(d)(3).
1.12 	(b) For taxable years beginning after December 31, 2005, the exemption amounts 
1.13 	and phaseout thresholds determined under paragraph (a) must be adjusted for inflation. 
1.14 	The commissioner shall make the inflation adjustments in accordance with section 1(f) of 
1.15 	the Internal Revenue Code except that, for the purposes of this subdivision, the percentage 
1.16 	increase must be determined from the year starting September 1, 2004, and ending August 
1.17 	31, 2005, as the base year for adjusting for inflation for the tax year beginning after 
1.18 	December 31, 2005. The determination of the commissioner under this subdivision is not 
1.19 	a rule under the Administrative Procedure Act.

1.20 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
1.21 	December 31, 2005.