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 1 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 1 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 1 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).

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