Dornink Act Expands Education Tax Credit to Reduce Barriers to CTE Programs
Published on Friday, March 15, 2024 at 8:43 p.m.
On Wednesday, the Senate Taxation Committee considered a bill authored by Sen. Gene Dornink (R-Brownsdale) that would expand the K-12 education credit to include costs for career and technical education (CTE) programs.
The Career and Technical Education Association says about half of jobs in Minnesota require some type of skills training. Less than a four-year degree, but more than a high school diploma.
“I introduced this bill to help families afford more CTE training. Our employers need more skilled workers, and Minnesotans need more stable, more affordable workers. We need these types of programs that lead to wages and jobs,” Dornink said. “Career and technical education programs meet both needs. This instruction is often delivered outside of the regular school building or school day in programs such as Future Farmers of America and SkillsUSA, but it is also available through the current education tax credit. My bill would allow the parents of these students to claim the K-12 Educational Earned Income Tax Credit, which would help cover a portion of the cost of sending their children to these important programs. This bill is good for parents, good for students and good for businesses.”
According to a bipartisan analysis, this bill expands the K-12 child care tax credit to include costs associated with:
• Career and technical education programs.
• Participation in student organizations that are part of the program's curriculum and equipment necessary for participation in the program.and
• Transportation outside of regular school hours that is directly related to the eligible child's participation in the program.
Low- and middle-income Minnesota taxpayers are currently entitled to a refundable income tax credit equal to 75% of eligible education expenses for eligible children in kindergarten through 12th grade. A maximum deduction of $1,500 per child is allowed. Eligible expenses include tuition fees outside of the regular school day or school year, the cost of textbooks and materials, and transportation expenses paid to others.
If signed, the bill would go into effect starting with the 2024 tax year. The maximum credit is phased out starting in 2024 when your adjusted gross income is $73,760, and the phase-out schedule depends on the number of eligible children. The phase-out criteria would be adjusted annually for inflation.
SF 4552 was put on hold for possible inclusion in a tax bill package later in the session.