ST. PAUL, MN – Joined by Minnesota workers and students who stand to benefit from his proposal, Governor Mark Dayton today urged the Minnesota Legislature to support his plan to protect or extend tax deductions that 900,000 Minnesotans and their families rely on, including deductions for employee expenses, homeownership costs, tuition payments, and more. Protections for these deductions are included in Governor Dayton’s plan to respond to the Federal Tax Bill, which would also cut taxes for over 2 million Minnesotans and their families. Governor Dayton today reiterated his commitment to improving family budgets without risking the long-term stability of our state’s budget.

 

Governor Dayton’s Tax Bill, part of his Budget for a Better Minnesota, continues his long-held commitment to tax fairness for hard-working Minnesotans, while preserving a responsible, balanced budget for our state’s future. It would cut taxes for over 2 million Minnesotans and their families, and protect tax breaks that nearly 900,000 million Minnesotans and their families rely on. To see the stories of four Minnesota families who would benefit from the Governor’s tax proposals, CLICK HERE.

 

Late last year, President Trump and Republicans in Congress enacted a Federal Tax Bill that overwhelmingly favored big corporations and the richest Americans. The new 2017 Federal Tax Law cut taxes by 40 percent for corporations, totaling 92 percent of the net total of the bill, or $1.35 trillion. Nearly 50 percent of new individual federal tax cuts go to the richest Americans – those earning over $250,000 per year. The Federal Tax Bill also reduced or eliminated many tax deductions that Minnesotans rely on to reduce their tax expenses – Governor Dayton’s tax proposal protects these important tax deductions for their state taxes.

 

Below, see some of the ways Governor Dayton’s tax bill would benefit 900,000 Minnesotans and their families.

 

·         Deducting Expenses Paid for Work – Governor Dayton’s tax proposal would protect a deduction for employees who have expenses related to their job, such as driving between different locations, which are not reimbursed by their employer. About 111,000 Minnesotans benefit from this deduction, saving an average $419 annually.

 

·         Reducing Homeownership Costs – Governor Dayton’s tax proposal would protect deductions Minnesotans count on to keep the costs of homeownership more affordable. Four of the deductions protected in Governor Dayton’s proposal include:

o    Property Tax Deduction – These deductions currently benefit roughly 40,000 Minnesotans, saving an average $502 annually. 

o    Moving Expense Deductions – Under the Governor’s proposal, workers moving in connection with a job will continue to receive tax benefits. About 61,000 Minnesotans will benefit from this deduction, saving an average $150 annually.

o    Casualty Loss Deduction – A family that suffers a major loss, like a house fire, will still be able to deduct those losses under the Governor’s proposal. About 800 Minnesotans benefit from this deduction, saving an average $16,400 annually.

 

·         Tuition Payment Deduction – Governor Dayton’s tax proposal would extend a tax deduction for Minnesotans paying tuition expenses for college or career training. The deduction allows families to deduct those costs from their state taxes, which currently benefits 27,000 Minnesotans, and can save qualifying individuals up to $282 a year, with an average savings of $96 a year.

 

·         Mortgage Insurance Premium Deduction – Extending this deduction would give approximately 70,000 homeowners tax breaks, averaging $94 annually.

 

·         Reimbursing Charity and Disaster Contributions – Federal tax changes will result in fewer Minnesotans itemizing, and thus receiving tax breaks for, their charitable contributions. Under the Governor’s proposal, Minnesotans will be able to continue to itemize charitable contributions. A family that, for instance, donates $400 per year and takes the federal standard deduction, but itemizes deductions for Minnesota, could keep deducting that amount from their state taxes. The Governor’s proposal would also match new federal tax deductions for Minnesotans who contribute to disaster relief efforts in cases of hurricanes Harvey, Irma, or Maria.

 

In addition to these provisions, Governor Dayton’s tax proposal protects other tax deductions that benefit Minnesota families moving expenses. To see a list of tax deductions benefitting Minnesotans and families which would be protected under Governor Dayton’s proposal, CLICK HERE.

As part of his Budget for a Better Minnesota, Governor Dayton’s tax proposal would cut taxes for over 2 million Minnesotans and their families. More than 1.9 million families would see an average tax cut of $117, and 329,000 families would see an average tax cut of $160. Along with protecting crucial tax deductions, these tax changes would improve family budgets without risking the stability of our state’s budget.

 

To learn more about Governor Dayton’s proposal to protect deductions and cut taxes for more than 2 million Minnesotans and improve family budgets, without risking the long-term stability of our state’s budget, CLICK HERE.

 

When Governor Dayton took office in 2011, he promised to make taxes fair for hard-working Minnesotans. Governor Dayton has delivered on that promise, with tax cuts targeted at improving the incomes and family budgets of low- and middle-income Minnesotans.

 

When Governor Dayton took office, the wealthiest Minnesotans paid a lower share of their incomes in state and local taxes, compared to the majority of hard-working Minnesotans. Governor Dayton pledged to raise income taxes by 2 percent on only the wealthiest 2 percent of Minnesotans, so that they paid their fair share like other Minnesotans. Governor Dayton delivered on that promise, and has worked with the Legislature to invest those new revenues in education, job creation, a stable state budget, and a better Minnesota.

 

Beyond the top 2 percent, 98 percent of Minnesotans have seen no increase in their income tax rates during Governor Dayton’s time in office, and Governor Dayton has signed into law over $1.5 billion in tax cuts for more than 2.3 million Minnesotans.