Recently passed Minnesota legislation retroactively changed Minnesota income tax laws to mostly conform with the federal changes from the Tax Cut and Jobs Act.
Who is affected
The greatest impact of the changes will likely apply to taxpayers who had property and equipment additions in 2018. The numerous other changes are mostly relatively small in dollar amount or affect a relatively small number of taxpayers. Minnesota retroactively changed the tax law in May 2019 for 2018. Many affected returns have been filed.
What this means to you
The changes further complicate an already complicated situation – for us, not you. The Minnesota Department of Revenue asked us to hold off filing Minnesota income tax returns that are affected by the retroactive changes and are figuring out what changes they can make on their own.
What you need to do
Please forward us any correspondence you get from the Minnesota Department of Revenue as soon as you can. There is nothing else you need to do at this time related to the recent changes.
For filed affected tax returns
For most taxpayers, the Department of Revenue will make the changes and send a notice that they have done so. If the Department of Revenue needs more information, you will receive a letter that either requests more information or an amended tax return. Please send us any letter you receive regarding a change as soon as possible.
How we are proceeding
If you have not filed your tax returns, and are not substantially affected, we will prepare your returns for filing in the regular course. If your Minnesota tax return is affected, we will hold it until the revised state forms are available.
Your federal income tax return is not affected by this legislation. For many of our clients we will move forward and file federal income tax returns and income tax returns of other states while holding off on filing the Minnesota income tax return. When applicable we will provide the Minnesota Department of Revenue with requested information and amend already filed Minnesota tax returns.