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Tax Law Changes

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Refunds in Progress for Affected 2020 Minnesota Returns

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We are in the process of adjusting 2020 Minnesota tax returns affected by law changes to the treatment of Unemployment Insurance (UI) compensation and Paycheck Protection Program (PPP) loan forgiveness. For details, read our September 9 announcement about UI and PPP tax refunds.

We're adjusting more than 540,000 Individual Income Tax returns and issuing refunds to taxpayers affected by the UI and PPP changes. We've finished adjusting and issuing refunds for all 2,200 entity-level corporate returns affected by the PPP changes.

These tax law changes were enacted July 1, 2021, along with other retroactive provisions affecting tax years 2017 to 2020. We have updated Minnesota tax forms and instructions for these years.

Note: When filing or amending a Minnesota return, be sure to use the most current forms or update your tax software.

Tax Year 2020

If you filed a 2020 income tax return that included unemployment compensation or PPP loan forgiveness, we'll either adjust the return or ask you to amend it.  

  • If we can adjust your return: We'll send you a letter describing what we changed and any refund you may receive as a result. We're committed to adjusting as many returns as we can. 

  • If you need to amend (due only to these law changes): You should have received a letter from us in August. If you did not receive a letter, we will adjust your return and notify you when we're done.

  • If you have not filed a 2020 return or filed for an extension: You may file using the updated forms to claim the recently passed unemployment and PPP loan forgiveness income exclusions and deductions.

Tax Years 2017, 2018, and 2019

If you have changes to tax returns for 2017, 2018, or 2019 due to the law changes enacted in July, you need to file an amended return using our updated forms. 

More Information To Come

We'll provide updates, guidance, and resources on our website and through email bulletins. For the latest information:

You may also email your questions to TaxLawChanges@state.mn.us.

Advance Payments of Federal Child Tax Credit
Changes to the federal Child Tax Credit mean that many families will get advance payments of the credit for 2021. Starting in July, the IRS pays half the total credit amount in monthly payments, and you claim the other half when you file your 2021 federal income tax return. For details, go to Advance Child Tax Credit Payments on the IRS website.

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