St. Paul, MN—The Minnesota House of Representatives approved legislation Wednesday that fixes Section 179 expensing—providing tax relief for farmers and small business owners across Minnesota. Included as part of House File 1, the language eliminates the state add-back for Section 179 deduction for tax years beginning in 2020 and retroactively, for property acquired in a like-kind exchange in tax years beginning in 2018.
“Providing a fix to the Section 179 issue was a top priority during this year’s legislative session and I am happy to see this get done,” said Rep. Poston. “By fixing these retroactive tax increases, we will help preserve family farms around the state and help Minnesota businesses reinvest in employees and communities.”
In 2019, Minnesota conformed to elements of the 2018 federal tax law, but did not adopt many of the expensing provisions including section 179. This resulted in Minnesota only allowing for a fraction of investments to be immediately expensed, thus putting Minnesotans at a disadvantage, and resulting in unexpected tax bills for farmers and small businesses.
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