SENATE CUTS DEAL ON SOCIAL SECURITY TAX CUT

The Senate on May 3 reached a compromise on legislation to cut state income taxes on Social Security benefits and other retirement benefits, ending a stalemate on the measure with a 29-3 vote. The Senate version of the bill, HB 444, would result in an estimated $155 million in lost tax revenue, substantially less than $285 million House version, which was loaded with myriad other tax cuts.

As originally filed by House Speaker Rod Jetton, the bill called for eliminating state taxes on Social Security benefits regardless of a senior’s income, which critics labeled a tax cut for the wealthy. Seventy-two percent of Missouri seniors already don’t pay the tax as individuals with incomes under $27,000 a year and married couples earning less than $32,000 annually are exempt.

The Senate compromise increases the exemption limit to $85,000 for a single person and $100,000 for married couples. A final version of the bill still needs to be worked out between the chambers.