What's New?
- 2007 Tax Year Changes
- No Return Required - Military (Online Form)
- Worksheet for Calculating Health Insurance Premium Subtraction
- 2008 Federal Stimulus Package Rebate Information
- Nonresident Property Tax Modification
Individual Income Tax Changes
Governor Matt Blunt signed several pieces of legislation in 2007 which will have a positive impact on Missouri income tax filers. The following changes are all effective January 1, 2007, and will be reflected on the 2007 Missouri income tax returns.
- New Public Pension Exemption
- New Social Security and Social Security Disability Deduction
- New Requirements for Nonresident Individuals Following the Passage of Senate Bill 748
- New Health Insurance Premium Subtraction
- New Credit for Donations Made to a Qualified Food Pantry
- New Deduction for Donations Made to a Health Care Sharing Ministry
- New Credit for Health Insurance Premiums Paid by Self-Employed Taxpayers
- Change to the Long Term Care Insurance Deduction
New Public Pension Exemption
Married couples with Missouri adjusted gross income less than $100,000 and single individuals with Missouri adjusted gross income less than $85,000, may deduct the greater of $6,000 or 20 percent of their public retirement benefits, to the extent the amounts are included in their federal adjusted gross income. The deductible percentage of their public retirement benefits will increase until 2012. A breakdown of the yearly percentage is as follows:
| Year | Limit |
|---|---|
| 2007 | 20% |
| 2008 | 35% |
| 2009 | 50% |
| 2010 | 65% |
| 2011 | 80% |
| 2012 and forward | 100% |
The total public pension exemption is limited to the maximum social security benefit of each spouse.
Married couples with Missouri adjusted gross income greater than $100,000 and single individuals with Missouri adjusted gross income greater than $85,000, may qualify for a partial exemption. See the public pension exemption eligibility chart or complete the public pension calculation located on the MO-A, to determine if you are eligible.
New Social Security and Social Security Disability Deduction
Married couples with Missouri adjusted gross income less than $100,000 and single individuals with Missouri adjusted gross income less than $85,000, may deduct up to 20% of taxable social security and social security disability benefits. The deductible percentage of their social security and social security disability benefits will increase until 2012. A breakdown of the yearly percentage is as follows:
| Year | Limit |
|---|---|
| 2007 | 20% |
| 2008 | 35% |
| 2009 | 50% |
| 2010 | 65% |
| 2011 | 80% |
| 2012 and forward | 100% |
Individuals must be 62 to qualify for a social security deduction.
Married couples with Missouri adjusted gross income greater than $100,000 and single individuals with Missouri adjusted gross income greater than $85,000, may qualify for a partial deduction. See the social security/social security disability deduction eligibility chart or complete the social security/social security disability calculation located on the MO-A, to determine if you are eligible.
New Requirements for Nonresident Individuals Following the Passage of Senate Bill 748 - Updated June 2008
Nonresident individuals must add to their federal adjusted gross income, any property taxes paid to another state or political subdivision, which are included as an itemized deduction on their federal return, unless such state or political subdivision allows a subtraction from income for Missouri property taxes.
For more information, visit our Frequently Asked Questions.
New Health Insurance Premium Subtraction
Individuals may subtract from their federal adjusted gross income, qualified health insurance premiums, to the extent their premiums paid were not reimbursed by their employer, or excluded from their federal taxable income. To determine the allowable subtraction, use the Worksheet for Calculating Health Insurance Premium Subtraction 
.
New Credit for Donations Made to a Qualified Food Pantry
Any taxpayer that makes a donation of cash or food supplies to an eligible food pantry may receive a credit of up to $2,500 per taxpayer per year.
Please visit the following web page for eligibility requirements: Miscellaneous Tax Credits
To file for the food pantry tax credit, please complete Form MO-FPT.
New Deduction for Donations Made to a Health Care Sharing Ministry
Individuals who made contributions to a health care sharing ministry may reduce their Missouri adjusted gross income by 100 percent of the contributions paid.
A health care sharing ministry is defined as:
A faith based non-profit organization tax exempt under the Internal Revenue Code that:
- Limits membership to those who are of a similar faith;
- Acts as an organizational clearinghouse for information between members or subscribers who have financial, physical, or medical needs and members or subscribers with the present ability to assist those with present financial or medical needs;
- Provides for the financial or medical needs of a member or subscriber through gifts directly from one member or subscriber to another. The requirements of this subdivision can be satisfied by a trust established solely for the benefit of members or subscribers, which trust is audited annually by an independent auditing firm;
- Provides amounts that members or subscribers may give with no assumption of risk or promise to pay either among the members or subscribers or between the members or subscribers and such organization;
- Provides a written monthly statement to all members or subscribers, listing the total dollar amount of qualified needs submitted to such organization, as well as the amount actually published or assigned to members or subscribers for voluntary payment; and
- Provides the following written disclaimer on or accompanying all promotional or informational documents distributed by or on behalf of the organization, including applications, and guideline materials.
NOTICE: This publication is not an insurance company nor is it offered through an insurance company. Whether anyone chooses to assist you with your medical bills will be totally voluntary, as no other subscriber or member will be compelled to contribute toward your medical bills. As such, this publication should never be considered to be insurance. Whether you receive any payments for medical expenses and whether or not this publication continues to operate, you are always personally responsible for the payment of your own medical bills.
To take the health care sharing ministry deduction, complete Missouri Form MO-1040.
New Credit for Health Insurance Premiums Paid by Self-Employed Taxpayers
Self-employed taxpayers who were not able to deduct their health insurance premiums on their federal income tax return, may receive a credit equal to the portion of the taxpayer’s federal tax liability incurred due to the inclusion of such payments for qualified health insurance premiums in their Federal Adjusted Gross Income.
Please visit the following web page: Miscellaneous Tax Credits
To file for the self-employed health insurance tax credit, please complete Form MO-SHC.
Change to the Long Term Care Insurance Deduction
Individuals may now deduct 100 percent of the amounts paid for long term care insurance, to the extent the amounts paid were not excluded from federal taxable income.