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Senate rejects Social Security, child care tax breaks

The state Senate has turned down a measure to exempt Social Security benefits from the state income tax.

Supporters say of the 41 states that have a state income tax, 38 exempt Social Security income. Sen. Jim Dotzenrod (D-Wyndmere) said he introduced the measure because of that, and to help keep retirees in North Dakota.

"They are often empty-nesters," Dotzenrod said. "They're free to travel. They often have skills, talent and the time to contribute to the economies of our communities, if we indicate to them their Social Security income will not be subject to the state income tax, and that would act as ann incentive for them to stay here."

But Sen. Jordan Kannianen (R-Stanley) said Social Security income is already tax exempt up to $25,000, or $32,000 for a married couple, so that covers many recipients already.

"It's only the higher earners that have significant income from other sources that have to pay any of the income tax," Kannianen said.

That bill failed on a 32 to 13 vote.


The Senate also rejected a bill that would allow companies that offer child care reimbursement to their employees to receive a tax credit on their state corporate income tax.

Supporters say it would also be a way the companies could help young families who struggle finding affordable child care.

"Research has shown that when parents feel they're receiving high quality child care, they are more productive at work," said the bill's sponsor, Sen. JoNell Bakke (D-Grand Forks) during floor debate. "Also, the child is learning school readiness skills, such as learning to share, following directions, cooperative play and a host of other skills."

Opponents said because there’s no way to tell how this could impact the state’s general fund, the measure might be too expensive.

The bill failed on a 32 to 13 vote.

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