diff --git a/changelog.d/ms-mo-misc-deduction-double-count.fixed.md b/changelog.d/ms-mo-misc-deduction-double-count.fixed.md new file mode 100644 index 00000000000..b3afeabe014 --- /dev/null +++ b/changelog.d/ms-mo-misc-deduction-double-count.fixed.md @@ -0,0 +1 @@ +Count the pre-2018 federal miscellaneous deduction once in Mississippi and Missouri itemized deductions. diff --git a/policyengine_us/parameters/gov/states/mo/tax/income/deductions/itemized.yaml b/policyengine_us/parameters/gov/states/mo/tax/income/deductions/itemized.yaml index 29872f6ad0b..14c58b0561d 100644 --- a/policyengine_us/parameters/gov/states/mo/tax/income/deductions/itemized.yaml +++ b/policyengine_us/parameters/gov/states/mo/tax/income/deductions/itemized.yaml @@ -1,8 +1,9 @@ description: Missouri lets filers itemize the following deductions. values: 1993-01-01: - - itemized_taxable_income_deductions # includes casualty_loss_deduction, charitable_deduction, interest_deduction, salt_deduction ,and medical_expense_deduction - - misc_deduction + # Form MO-A Part 2 line 1: total federal itemized deductions, which include + # the miscellaneous deduction above the 2% floor before 2018. + - itemized_taxable_income_deductions - employee_social_security_tax - employee_medicare_tax - additional_medicare_tax @@ -22,3 +23,5 @@ metadata: href: https://dor.mo.gov/forms/MO-1040%20Instructions_2021.pdf#page=16 - title: 2024 Form MO-A - Individual Income Tax Adjustments, Part 2 - Missouri Itemized Deductions href: https://dor.mo.gov/forms/MO-A_2024.pdf#page=2 + - title: 2017 Form MO-1040 instructions, Form MO-A Part 2 line 1 + href: https://dor.mo.gov/forms/MO-1040%20Instructions_2017.pdf#page=22 diff --git a/policyengine_us/tests/policy/baseline/gov/states/mo/tax/income/deductions/mo_itemized_deductions.yaml b/policyengine_us/tests/policy/baseline/gov/states/mo/tax/income/deductions/mo_itemized_deductions.yaml index d2510d5c88d..f453eb1dd78 100644 --- a/policyengine_us/tests/policy/baseline/gov/states/mo/tax/income/deductions/mo_itemized_deductions.yaml +++ b/policyengine_us/tests/policy/baseline/gov/states/mo/tax/income/deductions/mo_itemized_deductions.yaml @@ -5,7 +5,6 @@ itemized_taxable_income_deductions: 0 employee_social_security_tax: 0 employee_medicare_tax: 0 - misc_deduction: 0 mo_net_state_income_taxes: 0 state_code: MO output: @@ -15,10 +14,11 @@ period: 2021 absolute_error_margin: 0.01 input: - itemized_taxable_income_deductions: 10 + # Form MO-A Part 2 line 1 is the federal total, which already includes + # any miscellaneous deduction. + itemized_taxable_income_deductions: 20 employee_social_security_tax: 0 employee_medicare_tax: 0 - misc_deduction: 10 mo_net_state_income_taxes: 10 state_code: MO output: @@ -28,10 +28,9 @@ period: 2021 absolute_error_margin: 0.01 input: - itemized_taxable_income_deductions: 1000 + itemized_taxable_income_deductions: 2000 employee_social_security_tax: 0 employee_medicare_tax: 0 - misc_deduction: 1000 mo_net_state_income_taxes: 1000 state_code: MO output: @@ -51,3 +50,20 @@ households: {household: {members: [head, spouse], state_code: MO}} output: mo_itemized_deductions: 50_000 + +# 2017 Form MO-A Part 2 line 1 is total federal itemized deductions from Form +# 1040 line 40, which already includes the miscellaneous deduction above the +# 2% floor; Part 2 has no separate line for it. +- name: 2017 miscellaneous deduction counted once + period: 2017 + absolute_error_margin: 0.01 + input: + charitable_deduction: 9_000 + misc_deduction: 1_000 + employee_social_security_tax: 0 + employee_medicare_tax: 0 + mo_net_state_income_taxes: 0 + state_code: MO + output: + itemized_taxable_income_deductions: 10_000 + mo_itemized_deductions: 10_000 diff --git a/policyengine_us/tests/policy/baseline/gov/states/ms/tax/income/deductions/itemized/ms_itemized_deductions_unit.yaml b/policyengine_us/tests/policy/baseline/gov/states/ms/tax/income/deductions/itemized/ms_itemized_deductions_unit.yaml new file mode 100644 index 00000000000..38ffd8ebeb0 --- /dev/null +++ b/policyengine_us/tests/policy/baseline/gov/states/ms/tax/income/deductions/itemized/ms_itemized_deductions_unit.yaml @@ -0,0 +1,20 @@ +# 2017 Form 80-108 lines 7a to 7d take miscellaneous expenses above 2% of +# federal AGI once; itemized_deductions_less_salt already includes them. +- name: 2017 miscellaneous deduction counted once + absolute_error_margin: 0.01 + period: 2017 + input: + charitable_deduction: 2_000 + misc_deduction: 1_000 + state_code: MS + output: + ms_itemized_deductions_unit: 3_000 + +- name: 2025 no miscellaneous deduction subject to the 2% floor + absolute_error_margin: 0.01 + period: 2025 + input: + charitable_deduction: 2_000 + state_code: MS + output: + ms_itemized_deductions_unit: 2_000 diff --git a/policyengine_us/variables/gov/states/ms/tax/income/deductions/itemized/ms_itemized_deductions_unit.py b/policyengine_us/variables/gov/states/ms/tax/income/deductions/itemized/ms_itemized_deductions_unit.py index 0cbb0cdbd17..163abcd9ae8 100644 --- a/policyengine_us/variables/gov/states/ms/tax/income/deductions/itemized/ms_itemized_deductions_unit.py +++ b/policyengine_us/variables/gov/states/ms/tax/income/deductions/itemized/ms_itemized_deductions_unit.py @@ -12,12 +12,15 @@ class ms_itemized_deductions_unit(Variable): "https://www.dor.ms.gov/sites/default/files/tax-forms/individual/80100221.pdf#page=15", "https://www.dor.ms.gov/sites/default/files/tax-forms/individual/80108228.pdf", # Line 7 "https://law.justia.com/codes/mississippi/title-27/chapter-7/article-1/section-27-7-17/", + # 2017 instructions, Form 80-108 lines 7a to 7d. + "https://taxsim.nber.org/historical_state_tax_forms/MS/2017/80100178.pdf#page=15", ) defined_for = StateCode.MS + # itemized_deductions_less_salt already includes the federal miscellaneous + # deduction above the 2% floor (Form 80-108 lines 7a to 7d before 2018). adds = [ "itemized_deductions_less_salt", - "misc_deduction", "ms_real_estate_tax_deduction", ]