1.1                          A bill for an act 
  1.2             relating to individual income tax; modifying the 
  1.3             subtraction for the elderly and disabled; amending 
  1.4             Minnesota Statutes 2000, section 290.0802, subdivision 
  1.5             2. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 2000, section 290.0802, 
  1.8   subdivision 2, is amended to read: 
  1.9      Subd. 2.  [SUBTRACTION.] (a) A qualified individual is 
  1.10  allowed a subtraction from federal taxable income of the 
  1.11  individual's subtraction base amount.  The excess of the 
  1.12  subtraction base amount over the taxable net income computed 
  1.13  without regard to the subtraction for the elderly or disabled 
  1.14  under section 290.01, subdivision 19b, clause (5), may be used 
  1.15  to reduce the amount of a lump sum distribution subject to tax 
  1.16  under section 290.032. 
  1.17     (b)(1) The initial subtraction base amount equals 
  1.18     (i) $12,000 $14,000 for a married taxpayer filing a joint 
  1.19  return if a spouse is a qualified individual, 
  1.20     (ii) $9,600 $10,000 for a single taxpayer, and 
  1.21     (iii) $6,000 $7,000 for a married taxpayer filing a 
  1.22  separate federal return. 
  1.23     (2) The qualified individual's initial subtraction base 
  1.24  amount, then, must be reduced by the sum of nontaxable 
  1.25  retirement and disability benefits and one-half of the amount of 
  2.1   adjusted gross income in excess of the following thresholds: 
  2.2      (i) $18,000 $32,000 for a married taxpayer filing a joint 
  2.3   return if both spouses are qualified individuals, 
  2.4      (ii) $14,500 $25,000 for a single taxpayer or for a married 
  2.5   couple filing a joint return if only one spouse is a qualified 
  2.6   individual, and 
  2.7      (iii) $9,000 $16,000 for a married taxpayer filing a 
  2.8   separate federal return. 
  2.9      (3) In the case of a qualified individual who is under the 
  2.10  age of 65, the maximum amount of the subtraction base may not 
  2.11  exceed the taxpayer's disability income. 
  2.12     (4) The resulting amount is the subtraction base amount. 
  2.13     <b>[EFFECTIVE DATE.]</b> This section is effective for taxable 
  2.14  years beginning after December 31, 2000.