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MN Senior Advocates Want Changes to Social Security Taxes

More than 350,000 retired Minnesotans are being taxed on their Social Security income, and advocates for seniors say that is too many. (iStockphoto)
More than 350,000 retired Minnesotans are being taxed on their Social Security income, and advocates for seniors say that is too many. (iStockphoto)
March 7, 2016

ST. PAUL, Minn. - Senior advocates want to see Minnesota ease up on Social Security taxes, because they say too many low-and middle-income retirees are being negatively affected.

Minnesota is one of only a few states that taxes Social Security benefits. While some retirees do qualify for exemptions, the rules haven't been adjusted for 30 years.

Tom Counters retired in southeastern Minnesota and points out the number of retirees paying state Social Security taxes has tripled since 1984.

"It's unfortunate to realize how many people are dependent upon Social Security alone for their retirement income," says Counters. "That's not what Social Security was intended for, but that's a reality of life right now."

AARP Minnesota is urging state lawmakers to consider other options, including reducing the tax rate on the lowest earners over several years.

Last year, at least two Minnesota House Republicans introduced bills to do just that, but they are still pending. The idea is likely to come up again in this year's legislative session, which starts tomorrow.

Mary Jo George, advocacy director of AARP Minnesota, says even though single retirees who earn $25,000 or less are not taxed, her group believes the exemption level is outdated and should be raised.

"If we adjust those numbers to today's dollars, that would be equivalent to $57,000," says George. "So, we think it's time the Legislature really look at how can we make some of these changes."

Meanwhile, the state's highest-earning retirees are paying taxes on 85 percent of their Social Security income.

Brandon Campbell, Public News Service - MN