JEFFERSON CITY, Mo. — Missouri is one of only 11 states in the country that taxes social security benefits, and now one lawmaker wants to use the state’s extra cash to change that.
The Show-Me State currently has a $6 billion surplus, and there are many ideas inside the Capitol on what to spend it on. One Republican said it’s time for the state to give some relief to senior citizens, a plan estimated to cost millions.
“Right now, for people at a lot of different income levels, when they get their social security benefits, they pay taxes on those benefits as though it was regular income,” Sen. Tony Luetkemeyer, R-Parkville, said.
More than 75% of the country doesn’t require those on social security to pay income taxes, but Missouri doesn’t fall under that category.
“Missouri does have a record budget surplus and I believe giving that money back to the people is the best way that we can use those resources rather than more government spending,” Luetkemeyer said.
Like many Republicans this session, Luetkemeyer wants to use $300 million of the state’s multi-billion dollar surplus on a tax cut by giving relief to those on a fixed income.
“A lot of seniors I spoke with, this was the number one issue they brought up to me,” Luetkemeyer said. “For most retirees, they’ve been taxed to support our school districts and all other government functions for decades.”
Across the aisle, Democrats agree, Missouri’s older population needs a break and wants to see more legislation passed this session.
“We’re absolutely ready and willing to listen to anything that will make senior citizens life easier, especially when they are on a fixed income and everything seems to be getting more expensive,” Senate Minority Leader John Rizzo, D-Independence, said. “We also need to be freezing property taxes on seniors that have gone outlandish when you come into an area and there’s economic development or redevelopment and seniors who have been living in their home for 40, 50 years have a tax bill that was $200 for 10 years, and now it’s $5,000.”
Luetkemeyer’s legislation, Senate Bill 448, would eliminate the filing status and allow Missourians to deduct 100% of their social security benefits.
“We should be protecting our seniors, we should be standing with them and this is a very simple way to take some of that budget surplus, that historic budget surplus, that we have right now and put it back into the pockets of our seniors,” Luetkemeyer said.
He said there is no income cap on the legislation, and those on social security disability would also qualify. If passed and signed by the governor, it would go into effect in 2024.