Provide Income Tax Relief For Parents With Three Or More Children

 

The purpose of this bill is to ensure that all Minnesota residents with 3 or more children will receive a 0.75

percentage point reduction in their income tax rate. This act aims to reduce financial burden on many families and

strengthen familial stability while aiding long-term economic growth.

 

With slower population growth in the US, our nation is faced with great risk. According to the Congressional Budget

Office, it is projected that by 2033, population growth will slow from 0.9% to 0.2% annually and the crude death rate

will surpass the crude birth rate, thus resulting in a decline of American-born citizens. With immigration laws

constantly changing, it is critical for our nation to have a stable population growth inside the US to ensure a

prosperous future. Specifically, in Minnesota, the total number of adults aged 65 and up is expected to double between

2010 and 2030, according to projections from the Minnesota State Demographic Center. Due to the rise in the older

population, Minnesota's dependency ratio will increase, resulting in a smaller working population. This act will support

higher fertility rates, enabling future generations to sustain the dependent population while reducing economic strain

on the workforce. Furthermore, strong families are the foundation of our society, as parents who raise educated children

help build the future of our country. For many young couples, the dream of having a large family with multiple children

is unattainable because of the financial burdens that it may bring. Additionally, families with three or more children

have greater financial demands, often struggling to provide for their children's needs. By reducing income tax for

parents with 3 or more children, this act ensures that parents who take the responsibility of more children receive fair

treatment and the support they may need. When we invest in families and children, we invest in the future of our nation.

Through reducing the financial weight of larger families, we guarantee a prosperous future that children will one day

lead.

 

 

Dependent child: any child under 18 who relies on another individual, typically a parent or guardian, for care and

financial support.

Eligible family: parent(s) with 3 or more children

Minnesota Department of Revenue: Minnesota state agency responsible for managing the state’s revenue system and

enforcing Minnesota tax laws

Income tax reduction: rate reduction of 0.75% on an individual’s income tax

Misrepresentation: knowingly providing false information to obtain a tax benefit

Parent: any legal guardian of a dependent child

Crude death rate: number of deaths per 1,000 people in a population within a given year

Crude birth rate: number of live births per 1,000 people in a population within a given year

Fertility rate: average number of children a woman is expected to have during her lifetime

Dependency ratio: demographic measure comparing the number of people in a population that are in non-working age groups

and the number of people in working-age groups

Luxury tax: tax on non-essential and high-value goods

 

 

To balance the decrease in income tax revenue, a small 0.75% luxury tax will be implemented for vehicles valued over

$80,000 and jewelry and luxury brand name items valued at over $4,000.

 

 

The Minnesota Department of Revenue (DOR) is responsible for verifying eligibility for the benefit, preventing

fraudulent claims of dependents, and enforcing penalties for misrepresentation. Any person who intentionally provides

false information to receive these governmental benefits will be subject to repayment of the full amount saved during

the period in which they received income tax cuts. On top of repayment, the person will be obligated to pay a fine equal

to 50% of the total amount saved through misrepresentation. Furthermore, to penalize dishonesty, individuals who falsely

represent their eligibility will lose privileges of tax cuts based on family size for a total of 5 years. If this

offense is ever repeated more than once, the individual will be referred for investigation under Minnesota tax fraud

laws.

 

 

This act shall take effect on February 1st, 2026.