Full funds for tax filers

With time running out to make changes to the state’s tax law for the current filing season, Rep. Ann Lenczewski (DFL-Bloomington) wants to make sure Minnesota conforms to most of the federal changes enacted since Feb. 13, 2008, that Minnesota references for state tax administration purposes.

“(HF392) will keep people from having to file amended tax returns if this bill is passed later,” Lenczewski told the House Taxes Committee Feb. 3. “The timing only benefits the taxpayer.”

Approved by the committee, it now awaits action by the House Ways and Means Committee.

A companion, SF252, sponsored by Sen. Tom Bakk (DFL-Cook), awaits action by the Senate Taxes Committee.

The changes include:

• counting nontaxable combat pay as earned income for members of the military for purposes of claiming the earned income credit and working family credit;

• allowing direct transfers to charities from traditional IRAs and Roth IRAs for tax years 2008 and 2009;

• extending of the special rule for contribution of conservation property by qualified farmers and ranchers;

• apportioning the exclusion of gain on the sale of an individual’s principal residence for time periods after Jan. 1, 2009, when the residence was not used as the principal residence;

• extending various provisions related to depreciation and expensing;

• providing preferential tax treatment within the Midwestern Disaster Relief Area and within other federally designated disaster areas; and

• changing requirements for employer-sponsored group health plans to qualify for the employee income exclusion.