1.1 	A bill for an act
1.2 	relating to taxation; requiring expanded information reporting; appropriating 
1.3 	money; amending Minnesota Statutes 2006, section 289A.12, subdivision 4.
1.4 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.5 	Section 1. Minnesota Statutes 2006, section 289A.12, subdivision 4, is amended to 
1.6 	read:
1.7 		Subd. 4.Returns by persons, corporations, cooperatives, governmental entities, 
1.8 	or school districts. (a) The commissioner may by notice and demand require to the 
1.9 	extent required by section 6041 of the Internal Revenue Code, a person, corporation, 
1.10 	or cooperative, the state of Minnesota and its political subdivisions, and a city, county, 
1.11 	and school district in Minnesota, making payments in the regular course of a trade or 
1.12 	business during the taxable year to any person or corporation of $600 or more on account 
1.13 	of rents or royalties, or of $10 or more on account of interest, or $10 or more on account 
1.14 	of dividends or patronage dividends, or $600 or more on account of either wages, salaries, 
1.15 	commissions, fees, prizes, awards, pensions, annuities, or any other fixed or determinable 
1.16 	gains, profits or income, not otherwise reportable under section 289A.09, subdivision 2, or 
1.17 	on account of earnings of $10 or more distributed to its members by savings associations 
1.18 	or credit unions chartered under the laws of this state or the United States, (1) to file with 
1.19 	the commissioner a return (except in cases where a valid agreement to participate in the 
1.20 	combined federal and state information reporting system has been entered into, and the 
1.21 	return is filed only with the commissioner of internal revenue under the applicable filing 
1.22 	and informational reporting requirements of the Internal Revenue Code) with respect to 
1.23 	the payments in excess of the amounts named, giving the names and addresses of the 
1.24 	persons to whom the payments were made, the amounts paid to each, and (2) to make 
2.1 	a return with respect to the total number of payments and total amount of payments, 
2.2 	for each category of income named, which were in excess of the amounts named. This 
2.3 	subdivision does not apply to the payment of interest or dividends to a person who was a 
2.4 	nonresident of Minnesota for the entire year. 
2.5 	(b) For payments for which a return is covered by paragraph (a), regardless of 
2.6 	whether the commissioner has required filing under paragraph (a), the payor must file a 
2.7 	copy of the return with the commissioner if: 
2.8 	(i) the return is for a payment made to a Minnesota resident, to a recipient with a 
2.9 	Minnesota address, or for activity occurring in the state of Minnesota; and 
2.10 	(ii) the payment is for wages, salaries, or other compensation for services provided. 
2.11 	The commissioner may require this information to be filed in electronic or another form 
2.12 	that the commissioner determines is appropriate, notwithstanding the provisions of 
2.13 	paragraph (c).
2.14 	(c) A person, corporation, or cooperative required to file returns under this 
2.15 	subdivision must file the returns on magnetic media if magnetic media was used to satisfy 
2.16 	the federal reporting requirement under section 6011(e) of the Internal Revenue Code, 
2.17 	unless the person establishes to the satisfaction of the commissioner that compliance with 
2.18 	this requirement would be an undue hardship.

2.19 	EFFECTIVE DATE. This section is effective for forms required to be filed by 
2.20 	federal law after December 31, 2007.

2.21 	Sec. 2. APPROPRIATION.
 2.22 	$....... in fiscal year 2008 and $....... in fiscal year 2009 are appropriated from the 
2.23 	general fund to the commissioner of revenue. The commissioner shall use the amounts 
2.24 	appropriated under this section to use the information reporting required under section 
2.25 	1 to increase compliance with the individual income tax, including but not limited to 
2.26 	developing information systems, matching the information returns with tax returns and 
2.27 	other information, and auditing taxpayers.