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 from 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 line 10 of federal Schedule 1.
You may not claim this subtraction if either of the following apply:
- You did not file a federal return.
- You did not include an amount on line 10 of federal Schedule 1.
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 Schedule 1
- Line 11 of Form 1040NR
- Line 4 of Form 1040NR-EZ
Enter this amount on line 6 of your Minnesota income tax return (Form M1, Individual Income Tax).
For more information, see Minnesota Statute 290.0132, subdivision 3.