.................... moves to amend H.F. No. 481, the delete everything amendment
(A11-0139), as follows:
Page 41, delete section 20
Page 43, line 28, restore the stricken language and delete the new language
Page 43, line 29, restore the stricken language and delete the new language
Page 44, line 6, restore the stricken language and delete the new language
Page 44, line 7, restore the stricken language and delete the new language
Page 48, after line 32, insert:
Section 1. Minnesota Statutes 2010, section 290.01, subdivision 7, is amended to read:
Subd. 7. Resident.
(a) The term "resident" means any individual domiciled
in Minnesota, except that an individual is not a "resident" for the period of time that
the individual is a "qualified individual" as defined in section 911(d)(1) of the Internal
Revenue Code, if the qualified individual notifies the county within three months of
moving out of the country that homestead status be revoked for the Minnesota residence
of the qualified individual, and the property is not classified as a homestead while the
individual remains a qualified individual.
(b) "Resident" also means any individual domiciled outside the state who maintains
a place of abode in the state and spends in the aggregate more than one-half of the tax
year in Minnesota, unless:
(1) the individual or the spouse of the individual is in the armed forces of the United
(2) the individual is covered under the reciprocity provisions in section
For purposes of this subdivision, presence within the state for any part of a calendar
day constitutes a day spent in the state. Individuals shall keep adequate records to
substantiate the days spent outside the state.
The term "abode" means a dwelling maintained by an individual, whether or not
owned by the individual and whether or not occupied by the individual, and includes a
dwelling place owned or leased by the individual's spouse.
(c) "Part-year resident" means an individual domiciled outside the state who
2.8maintains a place of abode in the state and spends in the aggregate more than 60 days, but
2.9less than 183 days in Minnesota, unless:
2.10(1) the individual or the spouse of the individual is in the armed forces of the United
2.12(2) the individual is covered under the reciprocity provisions in section 290.081.
2.13For purposes of this subdivision, presence within the state for any part of a calendar
2.14day constitutes a day spent in the state, except for days an individual is receiving medical
2.15services or caring for a family member who is receiving medical services. Individuals
2.16shall keep adequate records to substantiate the days spent outside the state.
Neither the commissioner nor any court shall consider charitable contributions
made by an individual within or without the state in determining if the individual is
domiciled in Minnesota.
2.20EFFECTIVE DATE.This section is effective for taxable years beginning after
2.21December 31, 2010.
Sec. 2. Minnesota Statutes 2010, section 290.05, subdivision 1, is amended to read:
Subdivision 1. Exempt entities.
The following corporations, individuals, estates,
trusts, and organizations shall be exempted from taxation under this chapter, provided
that every such person or corporation claiming exemption under this chapter, in whole
or in part, must establish to the satisfaction of the commissioner the taxable status of
any income or activity:
(a) corporations, individuals, estates, and trusts engaged in the business of mining
or producing iron ore and other ores the mining or production of which is subject to
the occupation tax imposed by section
; but if any such corporation, individual,
estate, or trust engages in any other business or activity or has income from any property
not used in such business it shall be subject to this tax computed on the net income from
such property or such other business or activity. Royalty shall not be considered as income
from the business of mining or producing iron ore within the meaning of this section;
(b) the United States of America, the state of Minnesota or any political subdivision
of either agencies or instrumentalities, whether engaged in the discharge of governmental
or proprietary functions;
(c) any insurance company that is domiciled in a state or country other than
3.5Minnesota that imposes retaliatory taxes, fines, deposits, penalties, licenses, or fees
3.6and that does not grant, on a reciprocal basis, exemption from such retaliatory taxes to
3.7insurance companies or their agents domiciled in Minnesota. "Retaliatory taxes" means
3.8taxes imposed on insurance companies organized in another state or country that result
3.9from the fact that an insurance company organized in the taxing jurisdiction and doing
3.10business in the other jurisdiction is subject to taxes, fines, deposits, penalties, licenses, or
3.11fees in an amount exceeding that imposed by the taxing jurisdiction upon an insurance
3.12company organized in the other state or country and doing business to the same extent in
3.13the taxing jurisdiction; and
3.14(d) town and farmers' mutual insurance companies and mutual property and casualty
3.15insurance companies, other than those (1) writing life insurance or (2) whose total assets
3.16on December 31, 1989, exceeded $1,600,000,000
3.17EFFECTIVE DATE.This section is effective for taxable years beginning after
3.18December 31, 2010.
Sec. 3. Minnesota Statutes 2010, section 290.068, subdivision 2, is amended to read:
Subd. 2. Definitions.
For purposes of this section, the following terms have the
(a) "Qualified research expenses" means (i) qualified research expenses and basic
research payments as defined in section 41(b) and (e) of the Internal Revenue Code, except
it does not include expenses incurred for qualified research or basic research conducted
outside the state of Minnesota pursuant to section 41(d) and (e) of the Internal Revenue
Code; and (ii) contributions to a nonprofit corporation established and operated pursuant
to the provisions of chapter 317A for the purpose of promoting the establishment and
expansion of business in this state, provided the contributions are invested by the nonprofit
corporation for the purpose of providing funds for small, technologically innovative
enterprises in Minnesota during the early stages of their development.
(b) "Qualified research" means qualified research as defined in section 41(d) of the
Internal Revenue Code, except that the term does not include qualified research conducted
outside the state of Minnesota.
(c) "Base amount" means base amount as defined in section 41(c) of the Internal
Revenue Code, except that the average annual gross receipts must be calculated using
Minnesota sales or receipts under section
and the definitions contained in clauses
(a) and (b) shall apply. For a case in which the taxpayer cannot document the amount of its
4.3fixed base percentage under section 41(c)(3) of the Internal Revenue Code, the taxpayer
4.4may elect to calculate its base amount using a fixed-base percentage of 16 percent.
4.5EFFECTIVE DATE.This section is effective for taxable years beginning after
4.6December 31, 2010.
Sec. 4. Minnesota Statutes 2010, section 297A.61, subdivision 3, is amended to read:
Subd. 3. Sale and purchase.
(a) "Sale" and "purchase" include, but are not limited
to, each of the transactions listed in this subdivision.
(b) Sale and purchase include:
(1) any transfer of title or possession, or both, of tangible personal property, whether
absolutely or conditionally, for a consideration in money or by exchange or barter; and
(2) the leasing of or the granting of a license to use or consume, for a consideration
in money or by exchange or barter, tangible personal property, other than a manufactured
home used for residential purposes for a continuous period of 30 days or more.
(c) Sale and purchase include the production, fabrication, printing, or processing of
tangible personal property for a consideration for consumers who furnish either directly or
indirectly the materials used in the production, fabrication, printing, or processing.
(d) Sale and purchase include the preparing for a consideration of food.
297A.67, subdivision 2
, taxable food includes, but is not limited
to, the following:
(1) prepared food sold by the retailer;
(2) soft drinks;
(4) dietary supplements; and
(5) all food sold through vending machines.
(e) A sale and a purchase includes the furnishing for a consideration of electricity,
gas, water, or steam for use or consumption within this state.
(f) A sale and a purchase includes the transfer, or license to use,
for a consideration
of prewritten computer software whether delivered electronically, by load and leave,
or otherwise, or when the customer accesses the software and any ancillary computer
4.32hardware by means of remote facilities
(g) A sale and a purchase includes the furnishing for a consideration of the following
(1) the privilege of admission to places of amusement, recreational areas, or athletic
events, and the making available of amusement devices, tanning facilities, reducing
salons, steam baths, Turkish baths, health clubs, and spas or athletic facilities;
(2) lodging and related services by a hotel, rooming house, resort, campground,
motel, or trailer camp, including furnishing the guest of the facility with access to
telecommunication services, and the granting of any similar license to use real property in
a specific facility, other than the renting or leasing of it for a continuous period of 30 days
or more under an enforceable written agreement that may not be terminated without prior
notice and including accommodations intermediary services provided in connection with
5.10other services provided under this clause
(3) nonresidential parking services, whether on a contractual, hourly, or other
periodic basis, except for parking at a meter;
(4) the granting of membership in a club, association, or other organization if:
(i) the club, association, or other organization makes available for the use of its
members sports and athletic facilities, without regard to whether a separate charge is
assessed for use of the facilities; and
(ii) use of the sports and athletic facility is not made available to the general public
on the same basis as it is made available to members.
Granting of membership means both onetime initiation fees and periodic membership
dues. Sports and athletic facilities include golf courses; tennis, racquetball, handball, and
squash courts; basketball and volleyball facilities; running tracks; exercise equipment;
swimming pools; and other similar athletic or sports facilities;
(5) delivery of aggregate materials by a third party, excluding delivery of aggregate
material used in road construction, and delivery of concrete block by a third party if
the delivery would be subject to the sales tax if provided by the seller of the concrete
(6) services as provided in this clause:
(i) laundry and dry cleaning services including cleaning, pressing, repairing, altering,
and storing clothes, linen services and supply, cleaning and blocking hats, and carpet,
drapery, upholstery, and industrial cleaning. Laundry and dry cleaning services do not
include services provided by coin operated facilities operated by the customer;
(ii) motor vehicle washing, waxing, and cleaning services, including services
provided by coin operated facilities operated by the customer, and rustproofing,
undercoating, and towing of motor vehicles;
(iii) building and residential cleaning, maintenance, and disinfecting services and
pest control and exterminating services;
(iv) detective, security, burglar, fire alarm, and armored car services; but not
including services performed within the jurisdiction they serve by off-duty licensed peace
officers as defined in section
626.84, subdivision 1
, or services provided by a nonprofit
organization for monitoring and electronic surveillance of persons placed on in-home
detention pursuant to court order or under the direction of the Minnesota Department
(v) pet grooming services;
(vi) lawn care, fertilizing, mowing, spraying and sprigging services; garden planting
and maintenance; tree, bush, and shrub pruning, bracing, spraying, and surgery; indoor
plant care; tree, bush, shrub, and stump removal, except when performed as part of a land
clearing contract as defined in section
297A.68, subdivision 40
; and tree trimming for
public utility lines. Services performed under a construction contract for the installation of
shrubbery, plants, sod, trees, bushes, and similar items are not taxable;
(vii) massages, except when provided by a licensed health care facility or
professional or upon written referral from a licensed health care facility or professional for
treatment of illness, injury, or disease; and
(viii) the furnishing of lodging, board, and care services for animals in kennels and
other similar arrangements, but excluding veterinary and horse boarding services.
In applying the provisions of this chapter, the terms "tangible personal property"
and "retail sale" include taxable services listed in clause (6), items (i) to (vi) and (viii),
and the provision of these taxable services, unless specifically provided otherwise.
Services performed by an employee for an employer are not taxable. Services performed
by a partnership or association for another partnership or association are not taxable if
one of the entities owns or controls more than 80 percent of the voting power of the
equity interest in the other entity. Services performed between members of an affiliated
group of corporations are not taxable. For purposes of the preceding sentence, "affiliated
group of corporations" means those entities that would be classified as members of an
affiliated group as defined under United States Code, title 26, section 1504, disregarding
the exclusions in section 1504(b).
For purposes of clause (5), "road construction" means construction of (1) public
roads, (2) cartways, and (3) private roads in townships located outside of the seven-county
metropolitan area up to the point of the emergency response location sign.
(h) A sale and a purchase includes the furnishing for a consideration of tangible
personal property or taxable services by the United States or any of its agencies or
instrumentalities, or the state of Minnesota, its agencies, instrumentalities, or political
(i) A sale and a purchase includes the furnishing for a consideration of
telecommunications services, ancillary services associated with telecommunication
services, cable television services, direct satellite services, and ring tones.
Telecommunication services include, but are not limited to, the following services,
as defined in section
: air-to-ground radiotelephone service, mobile
telecommunication service, postpaid calling service, prepaid calling service, prepaid
wireless calling service, and private communication services. The services in this
paragraph are taxed to the extent allowed under federal law.
(j) A sale and a purchase includes the furnishing for a consideration of installation if
the installation charges would be subject to the sales tax if the installation were provided
by the seller of the item being installed.
(k) A sale and a purchase includes the rental of a vehicle by a motor vehicle dealer
to a customer when (1) the vehicle is rented by the customer for a consideration, or (2)
the motor vehicle dealer is reimbursed pursuant to a service contract as defined in section
7.16EFFECTIVE DATE.This section is for sales and purchases made after June 30,
Sec. 5. Minnesota Statutes 2010, section 297A.61, subdivision 7, is amended to read:
Subd. 7. Sales price.
(a) "Sales price" means the measure subject to sales tax, and
means the total amount of consideration, including cash, credit, personal property, and
services, for which personal property or services are sold, leased, or rented, valued in
money, whether received in money or otherwise, without any deduction for the following:
(1) the seller's cost of the property sold;
(2) the cost of materials used, labor or service cost, interest, losses, all costs of
transportation to the seller, all taxes imposed on the seller, and any other expenses of
(3) charges by the seller for any services necessary to complete the sale, other than
delivery and installation charges;
(4) delivery charges, except the percentage of the delivery charge allocated to
delivery of tax exempt property, when the delivery charge is allocated by using either (i) a
percentage based on the total sales price of the taxable property compared to the total sales
price of all property in the shipment, or (ii) a percentage based on the total weight of the
taxable property compared to the total weight of all property in the shipment; and
(5) installation charges.
(b) Sales price does not include:
(1) discounts, including cash, terms, or coupons, that are not reimbursed by a third
party and that are allowed by the seller and taken by a purchaser on a sale;
(2) interest, financing, and carrying charges from credit extended on the sale of
personal property or services, if the amount is separately stated on the invoice, bill of sale,
or similar document given to the purchaser; and
(3) any taxes legally imposed directly on the consumer that are separately stated on
the invoice, bill of sale, or similar document given to the purchaser.
(c) Sales price includes consideration received by the seller from third parties if:
(1) the seller actually receives consideration from a party other than the purchaser
and the consideration is directly related to a price reduction or discount on the sale;
(2) the seller has an obligation to pass the price reduction or discount through to
(3) the amount of the consideration attributable to the sale is fixed and determinable
by the seller at the time of the sale of the item to the purchaser; and
(4) one of the following criteria is met:
(i) the purchaser presents a coupon, certificate, or other documentation to the seller
to claim a price reduction or discount when the coupon, certificate, or documentation is
authorized, distributed, or granted by a third party with the understanding that the third
party will reimburse any seller to whom the coupon, certificate, or documentation is
(ii) the purchaser identifies himself or herself to the seller as a member of a group or
organization entitled to a price reduction or discount. A "preferred customer" card that is
available to any customer does not constitute membership in such a group; or
(iii) the price reduction or discount is identified as a third-party price reduction or
discount on the invoice received by the purchaser or on a coupon, certificate, or other
documentation presented by the purchaser.
8.27(d) For services as defined in subdivision 3, paragraph (g), clause (2), sales price
8.28includes amounts charged for services provided by an accommodations intermediary
8.29delivered or provided in connection with services defined in subdivision 3, paragraph
8.30(g), clause (2).
8.31EFFECTIVE DATE.This section is effective for sales and purchases made after
8.32June 30, 2011.
Sec. 6. Minnesota Statutes 2010, section 297A.61, is amended by adding a subdivision
9.1 Subd. 47. Accommodations intermediary. "Accommodations intermediary"
9.2means any person or entity, other than an accommodations provider, that facilitates the
9.3sale of lodging as defined in section 297A.61, subdivision 3, paragraph (g), clause (2),
9.4and that charges a room charge to the customer. The term "facilitates the sale" includes
9.5brokering, coordinating, or in any way arranging for the purchase of or the right to use
9.6accommodations by a customer.
9.7EFFECTIVE DATE.This section is effective for sales and purchases made after
9.8June 30, 2011.
Sec. 7. Minnesota Statutes 2010, section 297A.61, is amended by adding a subdivision
9.11 Subd. 48. Accommodations provider. "Accommodations provider" means any
9.12person or entity that furnishes lodging as defined in section 297A.61, subdivision 3,
9.13paragraph (g), clause (2), to the general public for compensation. The term "furnishes"
9.14includes the sale of use or possession or the sale of the right to use or possess.
9.15EFFECTIVE DATE.This section is effective for sales and purchases made after
9.16June 30, 2011.
Sec. 8. Minnesota Statutes 2010, section 297A.66, is amended by adding a subdivision
9.19 Subd. 4a. Solicitor. (a) "Solicitor" for purposes of subdivision 1, paragraph (a),
9.20means a person, whether an independent contractor or other representative, who directly
9.21or indirectly solicits business for the retailer.
9.22(b) A retailer is presumed to have a solicitor in this state if it enters into an agreement
9.23with a resident under which the resident, for a commission or other consideration, directly
9.24or indirectly refers potential customers, whether by a link on an Internet Web site, or
9.25otherwise, to the seller. This paragraph only applies if the total gross receipts from
9.26sales to customers located in the state who were referred to the retailer by all residents
9.27with this type of agreement with the retailer is at least $10,000 in the 12-month period
9.28ending on the last day of the most recent calendar quarter before the calendar quarter in
9.29which the sale is made.
9.30(c) The presumption under paragraph (b) may be rebutted by proof that the resident
9.31with whom the seller has an agreement did not engage in any solicitation in the state
9.32on behalf of the retailer that would satisfy the nexus requirement of the United States
9.33Constitution during the 12-month period in question. Nothing in this section shall be
10.1construed to narrow the scope of the terms affiliate, agent, salesperson, canvasser, or other
10.2representative for purposes of subdivision 1, paragraph (a).
10.3(d) For purposes of this paragraph, "resident" includes an individual who is a
10.4resident of this state, as defined in section 290.01, or a business that owns tangible
10.5personal property located in this state or has one or more employees providing services
10.6for it in this state.
10.7EFFECTIVE DATE.This section is effective for sales and purchases made after
10.8June 30, 2011.
Sec. 9. Minnesota Statutes 2010, section 297A.66, is amended by adding a subdivision
10.11 Subd. 6. Lodging services. An accommodations intermediary shall collect sales
10.12and use taxes and remit them to the commissioner under section 297A.77 for services
10.13provided in connection with or for lodging located in this state. The accommodation
10.14provider is deemed to be the agent of the accommodations intermediary for purposes of
10.15establishing the intermediary's obligation to collect.
10.16EFFECTIVE DATE.This section is effective for lodging and related services
10.17provided after June 30, 2011.
Sec. 10. Minnesota Statutes 2010, section 297A.68, is amended by adding a
subdivision to read:
10.20 Subd. 42. Lodging services purchased for resale. Services purchased from an
10.21accommodations provider for resale by an accommodations intermediary are exempt.
10.22The exemption under this subdivision and under the exclusion of sales for resale from
10.23the definition of a retail sale in section 297A.61, subdivision 4, applies only to an
10.24accommodations intermediary that registers to pay and to collect and remit tax under
10.25section 297A.83 for the applicable period. Registration confirms the intermediary's
10.26agreement to its legal obligation to collect.
10.27EFFECTIVE DATE.This section is effective for sales and purchases made after
10.28June 30, 2011.
Sec. 11. TRANSITION PROVISION.
10.30(a) This section applies to sales and use tax imposed on accommodations
10.31intermediaries for sales made before July 1, 2011, if the lodging was purchased by the
10.32accommodations intermediary for resale and the accommodations provider imposed tax
11.1under Minnesota Statutes, chapter 297A, on the sale. In computing the sales price for
11.2the tax to be collected from the accommodations intermediary, the amount paid by the
11.3accommodations intermediary to the accommodations provider is excluded.
11.4(b) The provisions of this section apply to local taxes imposed under Minnesota
11.5Statutes, section 469.190, or any special law.
11.6(c) For purposes of this section, the terms defined under Minnesota Statutes, chapter
11.8EFFECTIVE DATE.This section is effective for sales and purchases made before
11.9July 1, 2010.
Renumber the sections in sequence and correct the internal references
Amend the title accordingly