field_block:node:page:title
2023 Federal Conformity FAQs
field_block:node:page:field_subtitle
May Affect Tax Years 2017-2022
field_block:node:page:body
We will be updating and adding new FAQs as they become available. For the latest information:
field_block:node:page:field_paragraph
If any tax years were adjusted due to an audit or a previous Minnesota tax bill, use the most recent return or audit report information for your amended return. (Added 2/23/2023)
Interest relating to the January 2023 Minnesota tax bill changes begin to accrue either after December 31, 2023, or the regular due dates, whichever is later.
If penalties are assessed, you may request a penalty abatement for reasonable cause. The department will review abatement requests on a case-by-case scenario. (Added 2/23/2023)
Yes, amended returns will be paid interest following the general statute for refund interest (Minnesota Statutes, section 270C.405). (Added 2/23/2023)
If you filed a Minnesota return for a tax year 2017 through 2022 with a nonconformity schedule, you may need to file an amended return. Review the updated forms, instructions, and other resources on this web page for information to help you determine if an amended return should be filed. Check out our conformity chart and list of affected forms and schedules.
The January 2023 Minnesota tax bill did not include a catch-up adjustment. (Added 1/17/2023)
It depends. If items reported on a previously filed return affect your 2022 return, you may need to amend the previously filed return before filing your 2022 return. (Added 1/12/2023)
The January 2023 Minnesota tax bill extended the time to file amended returns to either December 31, 2023, or the general statute of limitations, whichever is later. This extension is only for the amended returns filed because of a law change in this tax bill.
The general statute of limitations allows you to file an amended return claiming a refund or reporting additional tax within 3 ½ years of the due date or 3 ½ years after you filed it, whichever is later. (Added 1/12/2023)
You may amend now by filing your amended returns by mail. Search and print updated tax forms and instructions on our website.
If you use tax software to calculate your amended return, you may file as soon as impacted forms and schedules are updated in your tax software. (Added 1/12/2023)
For 2022 only, include the ERC nonconformity adjustment on the line for “Employer credit for paid medical leave or employer payroll credit for required paid family leave.” You should also include a statement with your return stating why the ERC is impacting the 2022 return and what line you included the adjustment. (Added 3/31/2023)
No. The January 2023 Minnesota tax bill conforms with the federal EIDL. Review your Minnesota returns to determine if you should amend for this law change. (Added 2/23/2023)
No. The January 2023 Minnesota tax bill did not conform to federal ERC, but there is a retroactive Minnesota modification to state income. You may still subtract the related businesses expenses used to calculate the federal ERC. (Added 2/23/2023)
Yes. If you claim the federal credit and received less wages as a business expense deduction, you must include federal disallowed wages as a retroactive Minnesota modification. (Added 2/23/2023)
Yes. The January 2023 Minnesota tax bill conformed to federal SVOG provisions. Review your Minnesota returns to determine if you should amend for this law change. (Added 2/23/2023)
No. The January 2023 Minnesota tax bill did not conform to the 100% deduction for meals but enacted a modification to state income. You must still make an addition due to this retroactive Minnesota modification. (Added 2/23/2023)
No. If you claimed the Employer Payroll Credit for Required Paid Family Leave or Medical Leave, include the amount of the credit that was included in your federal gross income as a subtraction. The subtraction is due to the Minnesota modification enacted in January 2023, which is effective retroactively. (Added 2/23/2023)
Amend Schedule PTE, Pass-through Entity Tax, if your Minnesota source income increased or one or more owners elected to have the Schedule PTE fulfill their filing requirement.
If conformity decreased your Minnesota source income, see Schedule PTE for specific instructions. (Added 1/12/2023)
Yes, generally the Minnesota Main Street COVID Grant is taxable income on your federal return. In addition, Minnesota does not have a modification for the grant. Please consult with your accountant, lawyer, or other tax professional for additional assistance on the taxability of the grant. (Added 3/31/2023)
No. Partnerships and S Corporations making a PTE election should not pay nonresident withholding or composite tax. (Added 3/31/2023)
If the partnership or S corporation filed Schedule PTE for tax year 2021 and reported an amount on line 1 of the 2021 schedule, they may be able to subtract a portion of the 2021 bonus depreciation addition. (Added 3/31/2023)
Minnesota conformed to the TCJA changes to research expenses under section 174 in 2019. (Added 3/31/2023)
No. These payments are considered a federal tax credit. (Added 2/23/2023)
Yes. Canceled, discharged, or forgiven debt not included in your federal adjusted gross income must be included on Line 5 – Additional Nontaxable Income of Form M1PR, Homestead Credit Refund (for Homeowners) and Renter’s Property Tax Refund. Grants and advances not included in your federal adjusted income must also be included on Line 5 of Form M1PR. This includes the following COVID-19 related items:
- Small Business Administration (SBA) loan forgiveness, including:
- Paycheck Protection Plan (PPP) loan forgiveness
- Economic Injury Disaster Loan (EIDL) loan forgiveness
- Targeted and Supplemental EIDL advances
- Restaurant Revitalization Grants
- Shuttered Venue Operators Grants (Added 2/23/2023)
The January 2023 Minnesota tax bill did not change the definition of household income, which includes adjusted gross income and other nontaxable income. (Added 2/23/2023)
