Exploring Missouri Senate Bill 190: What It Means for Social Security and Retirement Benefit Deductions

Missouri Senate Bill 190, signed into law by Governor Mike Parson in 2023, aims to provide tax relief for seniors by expanding deductions for retirement and Social Security benefits. Under current law, eligible taxpayers can deduct a percentage of these benefits based on their filing status and adjusted gross income. This new legislation will allow all taxpayers, regardless of income level or filing status, to take advantage of the maximum deduction starting in tax year 2024. 

Key Takeaways:

• For tax years beginning on and after January 1, 2024, all taxpayers are eligible to claim the maximum deduction of certain retirement and Social Security benefits from their adjusted gross income
• Previous law allowed only taxpayers with a certain filing status and with an adjusted gross income below specific thresholds 100% deductions of select Social Security and retirement benefits
• The bill also establishes a property tax credit for eligible taxpayers who live in counties that approved the credit via an ordinance or as approved by voters

How Does MO SB 190 Impact Deductions for Social Security and Retirement Benefits?

Under the provisions outlined in MO SB 190, taxpayers in Missouri stand to benefit from enhanced tax relief measures specifically targeted toward seniors. Expanded deductions for retirement and Social Security benefits offer a significant financial reprieve for seniors. The current system, which bases deductions on filing status and adjusted gross income, will be replaced by a more inclusive approach that allows all taxpayers to claim the maximum deduction for tax years beginning on or after January 1, 2024, regardless of filing status or adjusted gross income.

In addition to providing tax relief for seniors by allowing 100% deductions for certain retirement and Social Security benefits, MO SB 190 also addresses issues related to property tax credits and liabilities. If taxpayers reside in a county that has “adopted an ordinance authorizing such a credit, or a petition in support of such credit” has been brought before and approved by voters. Taxpayers are eligible for the property tax credit if they are eligible for Social Security retirement benefits and are the “owner of record of or have a legal or equitable interest in a homestead” and are liable for real property tax payments on the property.

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