Law Change FAQs for Individuals

Our forms and systems are now updated for the changes passed into law for tax years 2017 and 2018. If you have already filed your return for these years, do not file an amended return.

• Find a form for Businesses
• Find a form for Individuals

Links to Software Providers who have revised their software are available on our website and additional software will be listed as it becomes available.

• Electronic Filing Options for Business Income Taxes
• Electronic Filing Software for Individuals

We plan to adjust most 2017 and 2018 Minnesota Individual Income Tax returns by the end of 2020.

We finished adjusting income tax returns for:

• C corporations
• S corporations
• Partnerships
• Fiduciaries that pay income tax or composite tax at the entity level

Yes. You may file an amended 2017 or 2018 Minnesota income tax return if Minnesota tax law changes impacted your return.

Can I amend 2017 or 2018 Minnesota returns for other reasons?
Yes. If you amend 2017 or 2018 Minnesota income tax returns for any other reason, also include all applicable adjustments related to the tax year 2017 and 2018 Minnesota law changes.

If you:

• Received our 2017 or 2018 Minnesota tax law change adjustments, include these adjustments in the amended return
• Did not receive our 2017 or 2018 Minnesota tax law change adjustments, include these adjustments along with the other adjustments on your amended return

What if I am also amending my 2017 or 2018 federal income tax returns?
If you file an amended federal income tax return, you must send us an amended Minnesota return and include a copy of your amended federal return. You must do so within 180 days of filing the federal return. Use the updated 2017 and 2018 Minnesota forms and instructions on our website.

This includes amending federal returns due to recent law changes, including:

• Taxpayer Certainty and Disaster Tax Relief Act of 2019
• Setting Every Community Up for Retirement Enhancement (SECURE) Act
• Families First Coronavirus Response Act
• Coronavirus Aid, Relief, and Economic Security (CARES) Act
• Paycheck Protection Program Flexibility Act of 2020

If you:

• Received our 2017 or 2018 Minnesota tax law change adjustment, include the adjustments in the amended return
• Did not receive our 2017 or 2018 Minnesota tax law change adjustment, include all Minnesota tax law change adjustments along with the other adjustments on your amended return

Yes. The department will make changes related to 2018 Minnesota tax law changes if you filed an original 2017 or 2018 Minnesota income tax returns on the old forms. However, you should use the updated 2017 and 2018 forms to file an original or amended 2018 Minnesota income tax return.

If you use software to prepare your return, make sure you update it before filing. You can check our website to see which software providers have updated their software.

If you haven’t filed, you can file using the 2018 Form M1PR on our website. You must file for the 2018 Property Tax Refund by August 15, 2020.

If you have already filed, do not amend. We will adjust your Form M1PR. If changes are needed, we will make changes to your Form M1, Individual Income Tax.

If you filed your Form M1 with an old Schedule M1NC and used them now to prepare Form M1PR, we may adjust your M1PR if needed, after you file.

Minnesota tax law changed to match federal law regarding the medical and dental expense deduction threshold. For years other than taxable year 2017, Minnesota law only allows a deduction for the medical and dental expenses that are more than 10% of a taxpayer’s adjusted gross income (AGI). For taxable year 2017, Minnesota tax law matches the federal law to allow a deduction for medical and dental expenses that are more than 7.5% of a taxpayer’s AGI.

You should complete a new Form W-4MN, Minnesota Employee Withholding Allowance/Exemption Certificate, when your personal or financial situation changes.  Talk to a tax professional if you have questions about your specific situation.

For 2019, you should also complete a new W-4MN if:

• You completed a new federal Form W-4
• You worked two or more jobs at the same time
• You claimed extra allowances because you were planning to itemize deductions
• You reasonably expect to change your filing status in the next calendar year
• Your income changes
• You experience a life event, such as marriage or the birth/adoption of a child

Complete Form W-4MN and submit it to your employer.  They will adjust your state tax withholding and report it to the Department of Revenue.

Yes. Miscellaneous itemized deductions are allowed for tax year 2018 on Schedule M1SA, Minnesota Itemized Deductions.

Taxpayers will calculate exemptions using a worksheet in the instructions for Form M1, Individual Income Tax. They will enter the calculated exemption amount on Form M1.

Minnesota follows the federal Internal Revenue Code definition of dependent. This means that a person must either be a qualifying child or relative to be claimed as a dependent.

Yes. For tax year 2018, due dates for filing and paying have not changed. If you are assessed penalty and interest related to the  federal law changes made in the TCJA in 2017, which were addressed in Minnesota law in  2019 (“tax law changes”), you may qualify for relief.

We will automatically adjust returns that are subject to the special limited adjustment. You do not need to do anything. The special limited adjustment will not change the amount of your refund or balance due.

We will review returns already filed and make needed adjustments. We will send you a letter if more information is required. Do not file an amended return if you are only changing a special adjustment item.

For tax year 2017, we will waive the ATC for underpayment of estimated income tax if both of the following apply:

• You underpaid due to uncertainty in tax planning as a result of federal tax law changes effective after December 31, 2016.
• Your tax after allowable credits is less than $1,000. 2019 Minn. Laws, 1st Spec. Sess., ch. 6, art. 2, sec. 25.

For tax year 2018, we will waive the ATC for underpayment of estimated income tax due to the uncertainty in tax planning that resulted from the federal law changes made in the TCJA in 2016, which were addressed in Minnesota law  in 2019. Minn. Stat. 270C.34.

Yes. If bonus depreciation reported on federal Form 4562, or Schedules KS, KPI, or KF, generated an activity loss that you cannot deduct due to the excess business loss limitation, do not include that bonus depreciation amount in the addback calculation for the current year.

In a future year when that suspended loss is allowed, you must include the bonus depreciation in the addback calculation. The bonus depreciation is treated as the last suspended loss allowed.

If you need to file your 2018 or 2019 return before we adjust your 2017 return, follow these steps to determine your 2018 and 2019 bonus depreciation subtraction for that asset if you claimed a 100% bonus depreciation on your federal return:

1. Identify the federal bonus depreciation claimed on that asset on the 2017 federal return. Contact the entity in which you have an ownership interest to determine your share of federal bonus depreciation claimed on that asset.
2. Multiply that deduction by 16% (0.16).

Do not file an amended 2017 Minnesota return specifically to make this adjustment. We will adjust your return. 

We will adjust returns for the final taxpayers for whom the income is taxable. We will not adjust S corporation, partnership, and fiduciary income tax returns unless the entity is paying income tax at the entity level or is reporting and paying composite tax on behalf of the owners or beneficiaries.

If you still need to file your 2018 return, contact the entity in which you have an ownership interest to receive updated information. 

Entities that have already filed should not file amended returns specifically for adjustments related to tax year 2017 and 2018 law changes.
If you need to file your 2018 or 2019 return before we adjust your 2017 return, follow these steps to determine your 2018 and 2019 bonus depreciation subtraction for that asset if you claimed a 100% bonus depreciation on your federal return:

1. Identify the federal bonus depreciation claimed on that asset on the 2017 federal return. Contact the entity in which you have an ownership interest to determine your share of federal bonus depreciation claimed on that asset. 
2. Multiply that deduction by 16% (0.16).

Do not file an amended 2017 Minnesota return specifically to make this adjustment. We will adjust your return.  

Do not report the amount on the “intentionally left blank” line. The amount is not needed to calculate your tax under the 2019 Minnesota laws.

We removed the 2018 Schedule LK from our website. When we adjust taxpayers’ returns, we will remove Schedule LK and the tax effects of that schedule.

Under the 2019 Minnesota law changes, Minnesota requires like-kind exchange treatment for the same transactions that is required for federal tax purposes.

The cost recovery method (depreciation and basis) for Minnesota purposes will be the same as what taxpayers used for federal tax purposes.

For state income tax returns, Minnesota conformed to the federal treatment of alimony for post-2018 divorce or separation agreements.

For agreements finalized in 2019, you may not deduct alimony paid, and alimony payments received are not included in income.

The treatment of alimony payments paid or received has not changed for the purposes of the Minnesota Property Tax Refund. Alimony you received is included in income, and alimony you paid is excluded from income.

For a small number of customers, we will send letters requesting more information so we can adjust their returns. Taxpayers may receive a letter if they did one of the following:

• Claimed bonus depreciation or section 179 expensing on their Schedule M1M, Income Additions and Subtractions
• Reported an amount on line 10 of their Schedule M1NR, Nonresidents/Part-Year Residents

For bonus depreciation or section 179 expensing, we will request copies of your federal Form 4562 and Schedule K.

For taxpayers with an amount on line 10 of Schedule M1NR, we will request information about the Schedule M1M additions reported on this line.