Yes, for certain employees. If you’re a nonresident employed in the transportation, airline, or shipping industries, special rules may apply to work-related income you earn in Minnesota.
Interstate transportation employees
If an interstate rail or motor carrier company pays you to regularly work in more than one state, you can only be taxed by your state of residence. As a nonresident, you do not have to file or pay Minnesota income tax on your work-related income earned in Minnesota. See U.S. Code, title 49, section 14503(a) (motor carriers) and section 11502 (rail carriers).
Water carriers
If a water carrier or merchant mariner pays you to regularly work in more than one state, you can only be taxed by your state of residence and a state where your perform 50% of your duties in the year. As a nonresident, you must file and pay Minnesota income tax if you earned more than 50% of your pay in Minnesota during the prior calendar year. See U.S. Code, title 49, section 14503(b)(2).
Airline employees
If an air carrier pays you to regularly work in more than one state, you can only be taxed only by your state of residence and a state where your perform 50% of your duties in the year. As a nonresident, you must file and pay Minnesota income tax only if you earned more than 50% of your pay in Minnesota. See U.S. Code, title 49, section 40116(f)(2).
Self-employed transportation workers
These federal laws do not apply if you are a self-employed transportation worker, such as an independent trucker hauling goods. The Minnesota Department of Revenue may still tax you under the single-sales factor apportionment method. For details, see the Minnesota Corporation Franchise Tax instructions.