How will my 2023 Social Security be taxed in MN?

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Strat335
Strat335 Member Posts: 4 Level 2

I heard there were substantial changes made in the way Minnesota will tax SS income. Can anyone clarify?

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  • MatthewD
    MatthewD FreeTaxUSA Team Posts: 247
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    Hi Strat335,

    There has been some changes in the MN Social Security Subtraction for tax year 2023.

    The new 2023 MN instructions says:

    "If you had a taxable Social Security benefits on line 6b of Form 1040 or 1040-SR, you may be eligible to subtract those benefits from your Minnesota taxable income."

    The instructions then go on to say:

    " Enter the full amount from line 6b of Form 1040 or 1040-SR on line 12 of Schedule M1M, if your adjusted gross income was below these amounts based on your filing status:
    • Single or Head of Household: $78,000
    • Married Filing Jointly or Qualifying Surviving Spouse: $100,000
    • Married Filing Separately: $50,000"

    In other words, you get a full subtraction of the taxable social security on your MN return if your income is less than those amounts for your filing status.

    However, the MN instructions go on to say:

    "If your adjusted gross income is greater than these amounts, you must determine your subtraction using the Worksheet for Line 12. Your subtraction equals the greater of step 8 (Simplified Method) or step 28 (Alternative Method)."

    So if you make more that those amounts above for your filing status, you may have a reduced subtraction or $0 subtraction. For more details see the MN Dept of Revenue website.

  • Strat335
    Strat335 Member Posts: 4 Level 2
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    Thanks for the good news MatthewD!