143.124. Annuities, pensions, retirement benefits, or retirement allowances provided by state, United States, political subdivisions or any other state, Keogh plans, annuities from defined pension pla
Annuities, pensions, retirement benefits, or retirement allowancesprovided by state, United States, political subdivisions or anyother state, Keogh plans, annuities from defined pension plansand IRAs, amounts subtracted from Missouri adjusted gross income.
143.124. 1. Other provisions of law to the contrary notwithstanding,for tax years ending on or before December 31, 2006, the total amount ofall annuities, pensions, or retirement allowances above the amount of sixthousand dollars annually provided by any law of this state, the UnitedStates, or any other state to any person except as provided in subsection 4of this section, shall be subject to tax pursuant to the provisions of thischapter, in the same manner, to the same extent and under the sameconditions as any other taxable income received by the person receiving it.For purposes of this section, "annuity, pension, retirement benefit, orretirement allowance" shall be defined as an annuity, pension or retirementallowance provided by the United States, this state, any other state or anypolitical subdivision or agency or institution of this or any other state.For all tax years beginning on or after January 1, 1998, for purposes ofthis section, annuity, pension or retirement allowance shall be defined toinclude 401(k) plans, deferred compensation plans, self-employed retirementplans, also known as Keogh plans, annuities from a defined pension plan andindividual retirement arrangements, also known as IRAs, as described in theInternal Revenue Code, but not including Roth IRAs, as well as an annuity,pension or retirement allowance provided by the United States, this state,any other state or any political subdivision or agency or institution ofthis or any other state. An individual taxpayer shall only be allowed amaximum deduction equal to the amounts provided under this section for eachtaxpayer on the combined return.
2. For the period beginning July 1, 1989, and ending December 31,1989, there shall be subtracted from Missouri adjusted gross income forthat period, determined pursuant to section 143.121, the first threethousand dollars of retirement benefits received by each taxpayer:
(1) If the taxpayer's filing status is single, head of household orqualifying widow(er) and the taxpayer's Missouri adjusted gross income isless than twelve thousand five hundred dollars; or
(2) If the taxpayer's filing status is married filing combined andtheir combined Missouri adjusted gross income is less than sixteen thousanddollars; or
(3) If the taxpayer's filing status is married filing separately andthe taxpayer's Missouri adjusted gross income is less than eight thousanddollars.
3. For the tax years beginning on or after January 1, 1990, butending on or before December 31, 2006, there shall be subtracted fromMissouri adjusted gross income, determined pursuant to section 143.121, amaximum of the first six thousand dollars of retirement benefits receivedby each taxpayer from sources other than privately funded sources, and fortax years beginning on or after January 1, 1998, there shall be subtractedfrom Missouri adjusted gross income, determined pursuant to section143.121, a maximum of the first one thousand dollars of any retirementallowance received from any privately funded source for tax years beginningon or after January 1, 1998, but before January 1, 1999, and a maximum ofthe first three thousand dollars of any retirement allowance received fromany privately funded source for tax years beginning on or after January 1,1999, but before January 1, 2000, and a maximum of the first four thousanddollars of any retirement allowance received from any privately fundedsource for tax years beginning on or after January 1, 2000, but beforeJanuary 1, 2001, and a maximum of the first five thousand dollars of anyretirement allowance received from any privately funded source for taxyears beginning on or after January 1, 2001, but before January 1, 2002,and a maximum of the first six thousand dollars of any retirement allowancereceived from any privately funded sources for tax years beginning on orafter January 1, 2002. A taxpayer shall be entitled to the maximumexemption provided by this subsection:
(1) If the taxpayer's filing status is single, head of household orqualifying widow(er) and the taxpayer's Missouri adjusted gross income isless than twenty-five thousand dollars; or
(2) If the taxpayer's filing status is married filing combined andtheir combined Missouri adjusted gross income is less than thirty-twothousand dollars; or
(3) If the taxpayer's filing status is married filing separately andthe taxpayer's Missouri adjusted gross income is less than sixteen thousanddollars.
4. If a taxpayer's adjusted gross income exceeds the adjusted grossincome ceiling for such taxpayer's filing status, as provided insubdivisions (1), (2) and (3) of subsection 3 of this section, suchtaxpayer shall be entitled to an exemption equal to the greater of zero orthe maximum exemption provided in subsection 3 of this section reduced byone dollar for every dollar such taxpayer's income exceeds the ceiling forhis or her filing status.
5. For purposes of this subsection, the term "maximum Social Securitybenefit available" shall mean thirty-two thousand five hundred dollars forthe tax year beginning on or after January 1, 2007, and for each subsequenttax year such amount shall be increased by the percentage increase in theConsumer Price Index for All Urban Consumers, or its successor index, assuch index is defined and officially reported by the United StatesDepartment of Labor, or its successor agency. For the tax year beginningon or after January 1, 2007, but ending on or before December 31, 2007,there shall be subtracted from Missouri adjusted gross income, determinedpursuant to section 143.121, a maximum of an amount equal to the greaterof: six thousand dollars in retirement benefits received from sourcesother than privately funded sources, to the extent such benefits areincluded in the taxpayer's federal adjusted gross income; or twenty percentof the retirement benefits received from sources other than privatelyfunded sources in the tax year, but not to exceed the maximum SocialSecurity benefit available for such tax year. For the tax year beginningon or after January 1, 2008, but ending on or before December 31, 2008,there shall be subtracted from Missouri adjusted gross income, determinedpursuant to section 143.121, a maximum of an amount equal to the greaterof: six thousand dollars in retirement benefits received from sourcesother than privately funded sources, to the extent such benefits areincluded in the taxpayer's federal adjusted gross income; or thirty-fivepercent of the retirement benefits received from sources other thanprivately funded sources in the tax year, but not to exceed the maximumSocial Security benefit available for such tax year. For the tax yearbeginning on or after January 1, 2009, but ending on or before December 31,2009, there shall be subtracted from Missouri adjusted gross income,determined pursuant to section 143.121, a maximum of an amount equal to thegreater of: six thousand dollars in retirement benefits received fromsources other than privately funded sources, to the extent such benefitsare included in the taxpayer's federal adjusted gross income; or fiftypercent of the retirement benefits received from sources other thanprivately funded sources in the tax year, but not to exceed the maximumSocial Security benefit available for such tax year. For the tax yearbeginning on or after January 1, 2010, but ending on or before December 31,2010, there shall be subtracted from Missouri adjusted gross income,determined pursuant to section 143.121, a maximum of an amount equal to thegreater of: six thousand dollars in retirement benefits received fromsources other than privately funded sources, to the extent such benefitsare included in the taxpayer's federal adjusted gross income; or sixty-fivepercent of the retirement benefits received from sources other thanprivately funded sources in the tax year, but not to exceed the maximumSocial Security benefit available for such tax year. For the tax yearbeginning on or after January 1, 2011, but ending on or before December 31,2011, there shall be subtracted from Missouri adjusted gross income,determined pursuant to section 143.121, a maximum of an amount equal to thegreater of: six thousand dollars in retirement benefits received fromsources other than privately funded sources, to the extent such benefitsare included in the taxpayer's federal adjusted gross income; or eightypercent of the retirement benefits received from sources other thanprivately funded sources in the tax year, but not to exceed the maximumSocial Security benefit available for such tax year. For all tax yearsbeginning on or after January 1, 2012, there shall be subtracted fromMissouri adjusted gross income, determined pursuant to section 143.121, amaximum of an amount equal to one hundred percent of the retirementbenefits received from sources other than privately funded sources in thetax year, but not to exceed the maximum Social Security benefit availablefor such tax year. A taxpayer shall be entitled to the maximum exemptionprovided by this subsection:
(1) If the taxpayer's filing status is married filing combined, andtheir combined Missouri adjusted gross income is equal to or less than onehundred thousand dollars; or
(2) If the taxpayer's filing status is single, head of household,qualifying widow(er), or married filing separately, and the taxpayer'sMissouri adjusted gross income is equal to or less than eighty-fivethousand dollars.
6. If a taxpayer's adjusted gross income exceeds the adjusted grossincome ceiling for such taxpayer's filing status, as provided insubdivisions (1) and (2) of subsection 5 of this section, such taxpayershall be entitled to an exemption, less any applicable reduction providedunder subsection 7 of this section, equal to the greater of zero or themaximum exemption provided in subsection 5 of this section reduced by onedollar for every dollar such taxpayer's income exceeds the ceiling for hisor her filing status.
7. For purposes of calculating the subtraction provided in subsection5 of this section, such subtraction shall be decreased by an amount equalto any Social Security benefit exemption provided under section 143.125.
8. For purposes of this section, any Social Security benefitsotherwise included in Missouri adjusted gross income shall be subtracted;but Social Security benefits shall not be subtracted for purposes of othercomputations pursuant to this chapter, and are not to be considered asretirement benefits for purposes of this section.
9. The provisions of subdivisions (1) and (2) of subsection 3 of thissection shall apply during all tax years in which the federal InternalRevenue Code provides exemption levels for calculation of the taxability ofSocial Security benefits that are the same as the levels in subdivisions(1) and (2) of subsection 3 of this section. If the exemption levels forthe calculation of the taxability of Social Security benefits are adjustedby applicable federal law or regulation, the exemption levels insubdivisions (1) and (2) of subsection 3 of this section shall beaccordingly adjusted to the same exemption levels.
10. The portion of a taxpayer's lump sum distribution from an annuityor other retirement plan not otherwise included in Missouri adjusted grossincome as calculated pursuant to this chapter but subject to taxation underInternal Revenue Code Section 402 shall be taxed in an amount equal to tenpercent of the taxpayer's federal liability on such distribution for thesame tax year.
11. For purposes of this section, retirement benefits received shallnot include any withdrawals from qualified retirement plans which aresubsequently rolled over into another retirement plan.
12. The exemptions provided for in this section shall not affect thecalculation of the income to be used to determine the property tax creditprovided in sections 135.010 to 135.035, RSMo.
13. The exemptions provided for in this section shall apply to anyannuity, pension, or retirement allowance as defined in subsection 1 ofthis section to the extent that such amounts are included in the taxpayer'sfederal adjusted gross income and not otherwise deducted from thetaxpayer's federal adjusted gross income in the calculation of Missouritaxable income. This subsection shall not apply to any individual whoqualifies under federal guidelines to be one hundred percent disabled.
14. In addition to all other subtractions authorized in this section,for all tax years beginning on or after January 1, 2010, there shall besubtracted from Missouri adjusted gross income, determined under section143.121, any retirement benefits received by any taxpayer as a result ofthe taxpayer's service in the armed forces of the United States, includingreserve components and the national guard of this state, as defined inSections 101(3) and 109 of Title 32, United States Code, and any othermilitary force organized under the laws of this state, to the extent suchbenefits are included in the taxpayer's federal adjusted gross income andnot otherwise deducted from the taxpayer's federal adjusted gross income inthe calculation of Missouri taxable income. Such retirement benefits shallbe subtracted as provided in the following schedule:
(1) For the tax year beginning on January 1, 2010, fifteen percent ofsuch retirement benefits;
(2) For the tax year beginning on January 1, 2011, thirty percent ofsuch retirement benefits;
(3) For the tax year beginning on January 1, 2012, forty-five percentof such retirement benefits;
(4) For the tax year beginning on January 1, 2013, sixty percent ofsuch retirement benefits;
(5) For the tax year beginning on January 1, 2014, seventy-fivepercent of such retirement benefits;
(6) For the tax year beginning on January 1, 2015, ninety percent ofsuch retirement benefits;
(7) For tax years beginning on or after January 1, 2016, one hundredpercent of such retirement benefits.
(L. 1989 H.B. 674 § 1, A.L. 1997 H.B. 491, A.L. 1999 H.B. 516, A.L. 2003 H.B. 600, A.L. 2007 H.B. 444, et al., A.L. 2009 H.B. 82)CROSS REFERENCE:
Exemptions for retirement benefits, RSMo 104.250