2016 Individual Income Tax Year Changes
The following changes are effective for the tax year beginning January 1, 2016, and will be reflected on the 2016 Missouri Individual Income Tax Returns
The due date for the 2016 Missouri Individual Income Tax Return is April 18, 2017.
Military Income Deduction
Senate Bill 814 (Section 143.174, RSMo) provides a deduction for military income earned as a member of the active duty component of the Armed Forces of the United States. The income must be included in the federal adjusted gross income and not previously taken as a deduction. This deduction can be claimed on line 19 of the 2016 Missouri Individual Income Tax Return (Form MO-1040). When submitting your return, include a copy of your Leave and Earnings Statement and any other official document, such as your Military Orders, which validates how long you were in active duty status and the amount you earned in active duty status. Failure to attach the requested documentation may result in the disallowance of this deduction.
Agriculture Disaster Relief
Senate Bill 641 (Section 143.121.3(10), RSMo) provides an income tax subtraction for payments received from a program that compensates agricultural producers who have suffered a loss due to a disaster or emergency. For tax year 2016, this subtraction can be claimed on Form MO-A, Part 1, Line 16 and reported on Line 4 of the Missouri Individual Income Tax Return (Form MO-1040). More information about the agriculture disaster relief subtraction can be found here.
Bring Jobs Home Deduction
Senate Bill 861 (Section 143.1100, RSMo), establishes the Bring Jobs Home Act and authorizes an income tax deduction of up to 50% of the eligible insourcing expenses associated with eliminating a business located outside of the state and relocating it in Missouri. This deduction can be claimed on line 20 of the 2016 Missouri Individual Income Tax Return (Form MO-1040).
To claim this deduction, you must first receive approval from the Department of Economic Development. For additional information, visit http://ded.mo.gov. or contact the Department of Economic Development at P.O. Box 118, Jefferson City, ) 65102-0118.
Military Pension Exemption
Beginning January 1, 2016, 100 percent of a military pension income will be exempt from Missouri state tax. The military pension exemption may be taken on the Form MO-1040, MO-A, Part 3, Section D.
Federal income tax changes affecting the Missouri return
Missouri individual income tax follows certain amounts set by the Internal Revenue Service. Below are the amounts that changed from tax year 2015:
- The standard deduction amount for the “Head of Household” filing status increased to $9,300 for tax year 2016. The other standard deduction amounts did not change from tax year 2015.
- Federal personal exemption amount - $4,050
- Itemized Deduction (Worksheet for net state and local income tax, complete if federal adjusted gross income is more than):
- Single - $259,400
- Married filing combined or qualifying widow(er) - $311,300
- Head of household - $285,350
- Married filing separate - $155,650