Dear neighbors,
The Capitol is a busy place this week. There will be many hours of floor session debating a number of bills, including a supplemental budget and a second tax bill with increased property tax relief for Minnesotans.
As I mentioned last week in my update, I wanted to share more details with you about the tax cut bill that was signed into law on March 21st. I’ve also attached the Department of Revenue guide for understanding the tax cuts that were put in place and posted some important information for folks who haven’t yet filed their tax return for this year.
Tax Cuts for more than 1 million Minnesotans
The House worked quickly to pass tax cuts this session. We were able to vote on a final bill that cut $508 million in taxes and send it to Governor Dayton on March 21st for his signature. There are many Minnesotans who will see immediate tax savings, and many more who will see increased tax savings in 2014 and beyond. Below, I’ve listed major impacts of the bill:
Estate Tax and Gift Tax
I was the chief author of legislation to bring federal conformity to our estate/gift tax, which included eliminating the gift tax, and am happy to report that the estate tax has been simplified by aligning it with the federal tax code, raising the cap on exempted inheritance from $1 million to $2 million. Minnesota’s gift tax has also been completely repealed. This sends the message that we want people to stay in MN and keep their assets here.
Tax Cuts for Minnesota Businesses ($167 million)
The business-to-business (B2B) sales taxes repeal bills, several of which I was the co-author on, also passed. Small businesses will see greater investment from this tax bill with the extension and expansion of the Angel Investment Tax Credit and simpler tax preparation with federal conformity.
· Warehouse and Storage Services: The warehouse sales tax is eliminated before it was supposed to begin on April 1, 2014.
· Commercial Equipment Repair: The sales taxes on repair and maintenance of electronic and commercial equipment are eliminated.
· Telecommunications Equipment Tax: The sales tax on telecommunications equipment is eliminated.
Tax Cuts for Working Families
More than one million middle class Minnesotans will see $230 million in tax cuts due to federal conformity and by boosting the State’s working family credit:
Stable Budget into the Future
While this bill contains a net $443 million tax cut, it also balances those tax cuts with a boost to our state’s rainy day fund by $150 million, keeping our budget stable into the future.
It was a great privilege last week to hear legislation to honor these brave women veterans!
Important Tax Filing Information
Because this tax relief package was passed before April 15th, the Minnesota Department of Revenue is working hard to make these tax cuts available to Minnesotans who have not yet filed their 2013 tax returns. The Department of Revenue will update all of their internal and online systems by April 3, 2014. They will also be working closely with online vendors who process returns to make sure that their software is updated to correctly process returns for potentially increased tax refunds.
If you have not yet filed your 2013 taxes, you should wait until after April 3, 2014 to do so.
If you have already filed your 2013 taxes, you don’t need to do anything right now.
deadline and then sending out any refund increase by whatever means you elected to receive your refund.
Enjoyed a great neighborhood gathering with terrific food at the new Glen Lake Cafe, right on Excelsior Boulevard!
If you have questions or concerns about this process or any tax changes please contact me at 651-296-3964 or rep.yvonne.selcer@house.mn
Best,
Yvonne Selcer
State Representative