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A bill for an act
relating to taxation; income and property tax refunds; reducing homestead credit
refund co-pays; authorizing the commissioner of revenue to implement a tax
compliance program; appropriating money; amending Minnesota Statutes 2024,
section 290A.04, subdivisions 2, 4.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2024, section 290A.04, subdivision 2, is amended to read:
Subd. 2.
Homeowners; homestead credit refund.
A claimant whose property taxes
payable are in excess of the percentage of the household income stated below shall pay an
amount equal to the percent of income shown for the appropriate household income level
along with the percent to be paid by the claimant of the remaining amount of property taxes
payable. The state refund equals the amount of property taxes payable that remain, up to
the state refund amount shown below.
Household Income
Percent of Income
Percent Paid by
Claimant
Maximum
State
Refund
$0 to
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2,079
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2,249
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1.0 percent
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12
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7
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percent
$
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3,310
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3,580
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2,080 to 4,139
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2,250 to 4,469
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1.1 percent
deleted text begin
12
deleted text end
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7
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percent
$
deleted text begin
3,310
deleted text end
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3,580
new text end
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4,140 to 6,269
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4,470 to 6,779
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1.2 percent
deleted text begin
12
deleted text end
new text begin
7
new text end
percent
$
deleted text begin
3,310
deleted text end
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3,580
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6,270 to 8,369
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6,780 to 9,049
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1.3 percent
deleted text begin
17
deleted text end
new text begin
12
new text end
percent
$
deleted text begin
3,310
deleted text end
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3,580
new text end
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8,370 to 10,439
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9,050 to 11,279
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1.4 percent
deleted text begin
17
deleted text end
new text begin
12
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percent
$
deleted text begin
3,310
deleted text end
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3,580
new text end
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10,440 to 14,619
deleted text end
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11,280 to 15,799
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1.5 percent
deleted text begin
17
deleted text end
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12
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percent
$
deleted text begin
3,310
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3,580
new text end
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14,620 to 16,689
deleted text end
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15,800 to 18,039
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1.6 percent
deleted text begin
17
deleted text end
new text begin
12
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percent
$
deleted text begin
3,310
deleted text end
new text begin
3,580
new text end
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16,690 to 18,799
deleted text end
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18,040 to 20,319
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1.7 percent
deleted text begin
17
deleted text end
new text begin
12
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percent
$
deleted text begin
3,310
deleted text end
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3,580
new text end
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18,800 to 20,879
deleted text end
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20,320 to 22,559
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1.8 percent
deleted text begin
17
deleted text end
new text begin
12
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percent
$
deleted text begin
3,310
deleted text end
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3,580
new text end
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20,880 to 22,949
deleted text end
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22,560 to 24,799
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1.9 percent
deleted text begin
22
deleted text end
new text begin
17
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percent
$
deleted text begin
3,310
deleted text end
new text begin
3,580
new text end
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22,950 to 29,239
deleted text end
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24,800 to 31,599
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2.0 percent
deleted text begin
22
deleted text end
new text begin
17
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percent
$
deleted text begin
3,310
deleted text end
new text begin
3,580
new text end
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29,240 to 31,319
deleted text end
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31,600 to 33,849
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2.0 percent
deleted text begin
27
deleted text end
new text begin
22
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percent
$
deleted text begin
3,310
deleted text end
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3,580
new text end
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31,320 to 35,509
deleted text end
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33,850 to 38,379
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2.0 percent
deleted text begin
27
deleted text end
new text begin
22
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percent
$
deleted text begin
3,310
deleted text end
new text begin
3,580
new text end
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35,510 to 50,099
deleted text end
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38,380 to 54,139
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2.0 percent
deleted text begin
32
deleted text end
new text begin
27
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percent
$
deleted text begin
3,310
deleted text end
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3,580
new text end
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50,100 to 73,059
deleted text end
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54,140 to 78,959
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2.0 percent
deleted text begin
32
deleted text end
new text begin
27
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percent
$
deleted text begin
2,680
deleted text end
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2,900
new text end
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73,060 to 83,499
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78,960 to 90,239
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2.0 percent
deleted text begin
37
deleted text end
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32
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percent
$
deleted text begin
2,350
deleted text end
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2,540
new text end
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83,500 to 93,939
deleted text end
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90,240 to 101,519
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2.1 percent
deleted text begin
37
deleted text end
new text begin
32
new text end
percent
$
deleted text begin
1,940
deleted text end
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2,100
new text end
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93,940 to 104,379
deleted text end
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101,520 to 112,799
new text end
2.2 percent
deleted text begin
37
deleted text end
new text begin
32
new text end
percent
$
deleted text begin
1,740
deleted text end
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1,880
new text end
deleted text begin
104,380 to 114,819
deleted text end
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112,800 to 124,089
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2.3 percent
deleted text begin
37
deleted text end
new text begin
32
new text end
percent
$
deleted text begin
1,520
deleted text end
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1,640
new text end
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114,820 to 121,089
deleted text end
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124,090 to 130,859
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2.4 percent
deleted text begin
42
deleted text end
new text begin
37
new text end
percent
$
deleted text begin
1,280
deleted text end
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1,380
new text end
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121,090 to 125,289
deleted text end
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130,860 to 135,399
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2.5 percent
deleted text begin
42
deleted text end
new text begin
37
new text end
percent
$
deleted text begin
1,070
deleted text end
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1,160
new text end
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125,290 to 130,349
deleted text end
new text begin
135,400 to 140,869
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2.5 percent
deleted text begin
47
deleted text end
new text begin
42
new text end
percent
$
deleted text begin
870
deleted text end
new text begin
940
new text end
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130,350 to 135,409
deleted text end
new text begin
140,870 to 146,339
new text end
2.5 percent
deleted text begin
47
deleted text end
new text begin
42
new text end
percent
$
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650
deleted text end
new text begin
700
new text end
The payment made to a claimant shall be the amount of the state refund calculated under
this subdivision. No payment is allowed if the claimant's household income is
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$135,410
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$146,340
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or more.
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EFFECTIVE DATE.
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This section is effective beginning with refunds based on property
taxes payable in 2027.
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Sec. 2.
Minnesota Statutes 2024, section 290A.04, subdivision 4, is amended to read:
Subd. 4.
Inflation adjustment.
The commissioner shall annually adjust the dollar
amounts of the income thresholds and the maximum refunds under subdivision 2 as provided
in section
270C.22
. The statutory year is
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2023
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2026
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.
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EFFECTIVE DATE.
new text end
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This section is effective beginning with refunds based on property
taxes payable in 2027.
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Sec. 3.
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TAX COMPLIANCE; TAX ANALYTICS AND BUSINESS INTELLIGENCE
TOOLS.
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Subdivision 1.
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Program activities.
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The commissioner of revenue may implement a
program of tax compliance, including the use of advanced tax analytics and business
intelligence tools to enhance tax assessment and collection by improving the means to
identify taxpayers that should be subject to audit and collection activities and by prioritizing
those activities to provide a higher rate of return on the activities of Department of Revenue
employees.
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Subd. 2.
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Priority.
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The tax compliance program under this section must prioritize
compliance and enforcement activities for corporations and complex pass-through entities
under the corporate franchise and individual income taxes, individual income taxpayers
reporting over $500,000 in taxable income, and businesses subject to the state's sales and
use tax laws.
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EFFECTIVE DATE.
new text end
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This section is effective the day following final enactment.
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Sec. 4.
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APPROPRIATION; TAX COMPLIANCE; TAX ANALYTICS AND
BUSINESS INTELLIGENCE TOOLS; RETURN ON INVESTMENT.
new text end
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(a) $5,000,000 in fiscal year 2026 and $15,000,000 in fiscal year 2027 are appropriated
from the general fund to the commissioner of revenue for purposes of the tax compliance,
tax analytics, and business intelligence tools program authorized under section 3. The amount
appropriated under this section must supplement and not supplant other amounts available
for the purposes described in this section.
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(b) The appropriation in paragraph (a) is for additional activities to identify and collect
tax liabilities from individuals and businesses that currently do not pay all taxes owed. This
initiative is expected to result in new general fund revenues of $20,000,000 for the biennium
ending June 30, 2027, and $120,000,000 for the biennium ending June 30, 2029.
new text end
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EFFECTIVE DATE.
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This section is effective the day following final enactment.
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