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Last Updated: 11/21/2018

What's new for Corporation Franchise Tax for 2017?

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​Federal adjustments for businesses

Minnesota defines net income for corporation franchise tax according to the Internal Revenue Code, as amended through December 16, 2016. Since that date, federal tax laws have been enacted that contain a number of provisions affecting corporation franchise tax for tax year 2017. Because Minnesota has not yet adopted these federal changes, adjustments must be made to correctly determine your Minnesota tax when filing your 2017 Form M4, Corporation Franchise Tax Return. See Federal Adjustments for Businesses beginning on page 13 of the Corporation Franchise Tax instructions.

Financial institutions

The definition of a financial institution is clarified and expanded to include entities other than corporations. 

Insurance companies

Certain insurance companies must be included in combined returns filed by unitary groups. 

Credit for Increasing Research Expenditures

The second-tier credit, for qualified research expenses over $2,000,000, is raised from 2.5 percent to 4 percent. 

Paper return filing fee

The fee of $5 per paper return assessed on preparers who expect to file more than 10 returns in a year is expanded to business returns including Forms M2, M3, M4 and M8. 

Greater Minnesota Internship Credit

This credit is repealed his credit is repealed for tax years beginning after 2017
For more information see the Department of Revenue's Legislative Bulletin and the Session Law passed by the Legislature and signed by Governor Dayton. 

Minimum fee indexed for inflation

The Minimum fee brackets and amounts are indexed for inflation each year. The brackets and amounts for 2017 are: 

​If your total Minnesota property, payroll and sales is: ​Your minimum fee is:
​Less than $970,000 ​$0
​$970,000 to $1,959,999 ​$200
​$1,960,000 to $9,769,999 ​$590
​$9,770,000 to $19,539,999 ​$1,960
​$19,540,000 to $39,079,999 ​$3,910
​$39,080,000 or more ​$9,770

Interest rate adjusted

The rate of interest charged on taxes due and paid on refunds is 4 percent for 2017. See interest rates for more information.