MissouriMissouri employees could subtract qualifying bonus pay when calculating state income tax
Starting with the 2027 tax year, Missouri employees could leave up to $25,000 in qualifying bonus pay out of the income used to calculate their state tax.
What it does
Employees could subtract up to $25,000 in qualifying bonus pay from income used to calculate Missouri income tax. The cap combines payments from all their jobs.
Argument forEligible workers could owe less Missouri income tax by leaving up to $25,000 in qualifying bonus pay out of the income used to calculate their tax.
Argument againstWorkers with similar earnings could face different tax treatment because only extra, nonrecurring pay that meets the definition would qualify.
More detail
An employee could subtract qualifying bonus pay from income used to calculate Missouri income tax. The provision covers employees and combines qualifying bonus payments from all of their jobs for the tax year. The payment must be extra, nonrecurring compensation that does not raise the employee's base pay or promise payment in a later year. The definition includes supplemental wages but excludes tips and overtime wages. The subtraction would apply to tax years beginning on or after January 1, 2027.
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Where it stands
- Introduced
- Passed House
- Passed Senate
- To Governor
- Became Law
Looking ahead
No hearings or votes scheduled.
History
- 2026
- May 15Referred: Emerging Issues(H)Latest
- Jan 8Read Second Time (H)Minor
- Jan 7Introduced and Read First Time (H)Introduced
Taxes & BudgetEconomy & Jobs