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On Wednesday, the Senate Taxes Committee heard legislation authored by Sen. Gene Dornink (R-Brownsdale) to expand the application of the K-12 education credit that would include expenses for career and technical education (CTE) programs.

The Association for Career and Technical Education states that roughly half of Minnesota’s jobs require some skills training; less than a four-year degree, but more than a high school diploma.

“I introduced this bill to help families have a little extra money for CTE training. Our employers need more skilled labor, and Minnesotans need these kinds of programs that lead to stable wages and employment,” Dornink said. “Career and technical education programs fill both needs. This instruction often happens outside of the regular school building and school day at programs like Future Farmers of America and SkillsUSA, but doesn’t meet the current criteria for the educational tax credit. My bill allows parents of these students to claim the K-12 education income tax credit so they can offset some expenses to help send their kids to these vital programs. This bill is good for parents, students, and businesses.”

According to a non-partisan analysis, the bill expands the K-12 child care tax credit to include expenses related to:

• Career and technical education programs;

• Participation in a student organization that is a component of the program curriculum, and equipment that is required for participation in the program; and

• Transportation outside regular school hours that is directly related to the qualifying child’s participation in the program.

A lower- and middle-income Minnesota taxpayer is currently allowed a refundable income tax credit equal to 75% of eligible education expenses for a qualifying child in kindergarten through grade 12, with a maximum credit of $1,500 for each qualifying child. Eligible expenses include fees for instruction outside the regular school day or school year, expenses for textbooks or instructional materials, and transportation costs paid to others.

If signed into law, the bill would be effective for the 2024 tax year. The maximum credit is phased out beginning at an adjusted gross income of $73,760 in 2024, and the phase-out schedule is dependent on the number of qualifying children. The phase-out threshold would be adjusted annually for inflation.

SF 4552 was laid over for possible inclusion in a tax bill package later in session.