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Last Updated: 5/11/2018

State Income Tax Refund Subtraction

Minnesota does not tax your state income tax refund, though it is subject to federal tax. If you reported a state refund on your federal return for the previous tax year, you may subtract this amount from your Minnesota taxable income.

Do I qualify for this subtraction?

To qualify, you must have reported a state income tax refund on your federal return last year.
You may not claim this subtraction if either of the following apply:
  • You did not itemize deductions on your federal return last year.
  • You filed using federal Form 1040A or Form 1040EZ.

How do I claim this subtraction?

Check the state refund amount reported on your federal return from last year. You will find the amount on one of these lines:
  • Line 10 of federal Form 1040
  • Line 11 of Form 1040NR
  • Line 4 of Form 1040NR-EZ
Enter this amount on line 5 of your Minnesota income tax return (Form M1, Individual Income Tax).