Apply MT 2021 income tax rebate once per return, not per spouse (#9012)

changelog.d/mt-rebate-double-count-9012.fixed.md

@@ -0,0 +1 @@
+Fixed the Montana 2021 income tax rebate double-count by applying the per-return cap once, splitting it across each spouse's column rather than projecting the tax-unit rebate onto every member.

policyengine_us/tests/policy/baseline/gov/states/mt/tax/income/credits/rebate/mt_income_tax_rebate.yaml

@@ -1,18 +1,30 @@
-- name: Single filer
+- name: Single filer receives the full single rebate
   period: 2023
   input:
     filing_status: SINGLE
     state_code: MT
   output:
     mt_income_tax_rebate: 1_250
 
-- name: Joint filers
+- name: Joint filers split the per-return rebate across each spouse's column
   period: 2023
   input:
-    filing_status: JOINT
-    state_code: MT
+    people:
+      person1:
+        is_tax_unit_head: true
+      person2:
+        is_tax_unit_spouse: true
+    tax_units:
+      tax_unit:
+        members: [person1, person2]
+        filing_status: JOINT
+    households:
+      household:
+        members: [person1, person2]
+        state_code: MT
   output:
-    mt_income_tax_rebate: 2_500
+    # $2,500 per-return cap split $1,250 per spouse (sums to $2,500, not $5,000)
+    mt_income_tax_rebate: [1_250, 1_250]
 
 - name: Not in Montana
   period: 2023

policyengine_us/tests/policy/baseline/gov/states/mt/tax/income/integration.yaml

@@ -94,15 +94,16 @@
       person1:
         age: 59
         taxable_interest_income: 5_505
+        mt_income_tax_rebate: 0  # not in TAXSIM35
       person2:
         age: 59
         employment_income: 27010
         taxable_interest_income: 5_505
+        mt_income_tax_rebate: 0  # not in TAXSIM35
     tax_units:
       tax_unit:
         members: [person1, person2]
         aca_ptc: 0  # not in TAXSIM35
-        mt_income_tax_rebate: 0
     spm_units:
       spm_unit:
         members: [person1, person2]
@@ -124,10 +125,12 @@
         age: 33
         employment_income: 7010
         taxable_interest_income: 5505
+        mt_income_tax_rebate: 0  # not in TAXSIM35
       person2:
         age: 33
         employment_income: 136010
         taxable_interest_income: 5505
+        mt_income_tax_rebate: 0  # not in TAXSIM35
       person3:
         age: 16
       person4:
@@ -140,7 +143,6 @@
       tax_unit:
         members: [person1, person2, person3, person4, person5, person6]
         local_income_tax: 0  # not in TAXSIM35
-        mt_income_tax_rebate: 0
     spm_units:
       spm_unit:
         members: [person1, person2, person3, person4, person5, person6]
@@ -162,10 +164,12 @@
         age: 66
         employment_income: 17010
         taxable_interest_income: 5505.0
+        mt_income_tax_rebate: 0  # not in TAXSIM35
       person2:
         age: 66
         employment_income: 7010
         taxable_interest_income: 5505.0
+        mt_income_tax_rebate: 0  # not in TAXSIM35
       person3:
         age: 11
       person4:
@@ -178,7 +182,6 @@
       tax_unit:
         members: [person1, person2, person3, person4, person5, person6]
         aca_ptc: 0  # not in TAXSIM35
-        mt_income_tax_rebate: 0
     spm_units:
       spm_unit:
         members: [person1, person2, person3, person4, person5, person6]
@@ -511,3 +514,28 @@
     mt_regular_income_tax_joint: 1_918
     mt_capital_gains_tax_joint: 1_022.8
     mt_income_tax: 2_940.8
+
+- name: MT 2021 joint couple rebate applies once per return, not per spouse (issue 9012)
+  period: 2021
+  absolute_error_margin: 0.01
+  input:
+    people:
+      head:
+        age: 45
+        employment_income: 90_000
+      spouse:
+        age: 45
+        employment_income: 70_000
+    tax_units:
+      tax_unit:
+        members: [head, spouse]
+    households:
+      household:
+        members: [head, spouse]
+        state_code: MT
+  output:
+    # $2,500 per-return cap split $1,250 per spouse (was double-counted to $5,000)
+    mt_income_tax_rebate: [1_250, 1_250]
+    # Files separately: 5,099.51 - 1,250 + 3,719.51 - 1,250 = 6,319.02
+    # (old double-count subtracted $2,500 per column, understating tax by $2,500)
+    mt_income_tax: 6_319.02

policyengine_us/variables/gov/states/mt/tax/income/credits/rebate/mt_income_tax_rebate.py

@@ -3,15 +3,25 @@
 
 class mt_income_tax_rebate(Variable):
     value_type = float
-    entity = TaxUnit
+    entity = Person
     label = "Montana 2021 income tax rebate"
     unit = USD
     definition_period = YEAR
     reference = "https://archive.legmt.gov/bills/mca/title_0150/chapter_0300/part_0210/section_0910/0150-0300-0210-0910.html"
     defined_for = StateCode.MT
 
-    # The rebate is based on 2021 income tax liability, but provided in 2023
-    def formula(tax_unit, period, parameters):
+    # The rebate is based on 2021 income tax liability, but provided in 2023.
+    # It applies once per return (MCA 15-30-2191(1)), so joint filers split
+    # the per-return cap across each spouse's column ($1,250 each) to avoid
+    # double-counting when the person-level non-refundable credits are pooled.
+    def formula(person, period, parameters):
         p = parameters(period).gov.states.mt.tax.income.credits.rebate
-        filing_status = tax_unit("filing_status", period)
-        return p.amount[filing_status]
+        filing_status = person.tax_unit("filing_status", period)
+        statuses = filing_status.possible_values
+        head_or_spouse = person("is_tax_unit_head_or_spouse", period)
+        per_person_amount = where(
+            filing_status == statuses.JOINT,
+            p.amount["SEPARATE"],
+            p.amount[filing_status],
+        )
+        return head_or_spouse * per_person_amount