Info for MN Tax Preparers

[Mike Mac]

Past threads have mentioned the fact that for 2007 MN is not in conformity with federal tax laws in regard to either the educator deduction or the much larger college tuition deduction. If taken as an adjustment to income on the federal return either must be added back to the MN return using the new M1NC form.

In many, if not most, years the MN legislature changes MN tax laws to come back into conformity with federal tax laws shortly after they come back in session. I know of some tax professionals that were holding their clients' MN returns if they were affected by the above two add-backs in hopes that would happen again this year and they could avoid the time and expense of doing an amended return. It appears MN will NOT come into conformance with those two items for 2007. A bill (HF3201/SF2935) that passed 132-1 specifically requires those items be added back to MN income for 2007. It is a virtual certainty that the governor will sign that bill soon.

Mike

[Bees Knees]

Thanks for keeping us informed. Years ago, MN seemed to accept everything the feds did. Now their list of adjustments just keeps getting bigger every year.

[Beth]

MN Tax Preparers

The post above reads: "It appears MN will NOT come into conformance with those two items for 2007. A bill (HF3201/SF2935) that passed 132-1 specifically requires those items be added back to MN income for 2007. It is a virtual certainty that the governor will sign that bill soon."

Says above will NOT come into compliance, and then referrences a bill that requires them into compliance. Am I missing something, as these seem to say opposite things...

Thanks!

[JON]

The Govenor, Minnesota,

has already stated this year he is not interested in having Minnesota get in line with the federal, but does want a major overhaul of the MN income tax.

[Bees Knees]

The post above reads: "It appears MN will NOT come into conformance with those two items for 2007. A bill (HF3201/SF2935) that passed 132-1 specifically requires those items be added back to MN income for 2007. It is a virtual certainty that the governor will sign that bill soon."

Says above will NOT come into compliance, and then referrences a bill that requires them into compliance. Am I missing something, as these seem to say opposite things...

Thanks!

No, he said the bill requires the deductions to be added back to MN income, which is the same thing as saying it does not comply with the federal rule that allows for the deductions.

[joanmcq]

We're seeing a lot more of this in CA too, because CA law must specifically change to conform to federal changes. More and more we are not conforming because to budget deficits so the nonconfomity list gets longer and longer.

And now, here we are with &*^% bonus depreciation again! Which CA did not conform to before, and I'm sure will not conform to again. Yeesh!