1.1                          A bill for an act
  1.2             relating to taxation; updating to changes in federal 
  1.3             law; allowing an extension to file individual income 
  1.4             tax returns and property tax refunds for national 
  1.5             guard and reserve members who are called to active 
  1.6             duty; providing filing extensions for individuals who 
  1.7             perform services for the peacekeeping efforts in 
  1.8             Bosnia and Herzegovina, Croatia, and Macedonia; 
  1.9             amending Minnesota Statutes 1994, section 289A.39, 
  1.10            subdivision 1; Minnesota Statutes 1995 Supplement, 
  1.11            sections 289A.02, subdivision 7; 290.01, subdivisions 
  1.12            19 and 31; and 291.005, subdivision 1. 
  1.13  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.14     Section 1.  Minnesota Statutes 1995 Supplement, section 
  1.15  289A.02, subdivision 7, is amended to read: 
  1.16     Subd. 7.  [INTERNAL REVENUE CODE.] Unless specifically 
  1.17  defined otherwise, "Internal Revenue Code" means the Internal 
  1.18  Revenue Code of 1986, as amended through April 15, 1995 March 
  1.19  22, 1996, and includes the provisions of section 1(a) and (b) of 
  1.20  Public Law Number 104-117. 
  1.21     Sec. 2.  Minnesota Statutes 1994, section 289A.39, 
  1.22  subdivision 1, is amended to read: 
  1.23     Subdivision 1.  [EXTENSIONS FOR SERVICE MEMBERS.] (a) The 
  1.24  limitations of time provided by this chapter, chapter 290 
  1.25  relating to income taxes, chapter 271 relating to the tax court 
  1.26  for filing returns, paying taxes, claiming refunds, commencing 
  1.27  action thereon, appealing to the tax court from orders relating 
  1.28  to income taxes, and the filing of petitions under chapter 278 
  1.29  that would otherwise be due May 15, 1991 1996, and appealing to 
  2.1   the Supreme Court from decisions of the tax court relating to 
  2.2   income taxes are extended, as provided in section 7508 of the 
  2.3   Internal Revenue Code. 
  2.4      (b) If a member of the national guard or reserves is called 
  2.5   to active duty in the armed forces, the limitations of time 
  2.6   provided by this chapter and chapters 290 and 290A relating to 
  2.7   income taxes and claims for property tax refunds are extended by 
  2.8   the following period of time: 
  2.9      (1) in the case of an individual whose active service is in 
  2.10  the United States, six months; or 
  2.11     (2) in the case of an individual whose active service 
  2.12  includes service abroad, the period of initial service plus six 
  2.13  months. 
  2.14     Nothing in this paragraph reduces the time within which an 
  2.15  act is required or permitted under paragraph (a). 
  2.16     (c) If an individual entitled to the benefit of paragraph 
  2.17  (a) files a return during the period disregarded under paragraph 
  2.18  (a), interest must be paid on an overpayment or refundable 
  2.19  credit from the due date of the return, notwithstanding section 
  2.20  289A.56, subdivision 2.  
  2.21     (d) The provisions of this subdivision apply to the spouse 
  2.22  of an individual entitled to the benefits of this subdivision 
  2.23  with respect to a joint return filed by the spouses.  
  2.24     Sec. 3.  Minnesota Statutes 1995 Supplement, section 
  2.25  290.01, subdivision 19, is amended to read: 
  2.26     Subd. 19.  [NET INCOME.] The term "net income" means the 
  2.27  federal taxable income, as defined in section 63 of the Internal 
  2.28  Revenue Code of 1986, as amended through the date named in this 
  2.29  subdivision, incorporating any elections made by the taxpayer in 
  2.30  accordance with the Internal Revenue Code in determining federal 
  2.31  taxable income for federal income tax purposes, and with the 
  2.32  modifications provided in subdivisions 19a to 19f. 
  2.33     In the case of a regulated investment company or a fund 
  2.34  thereof, as defined in section 851(a) or 851(h) of the Internal 
  2.35  Revenue Code, federal taxable income means investment company 
  2.36  taxable income as defined in section 852(b)(2) of the Internal 
  3.1   Revenue Code, except that:  
  3.2      (1) the exclusion of net capital gain provided in section 
  3.3   852(b)(2)(A) of the Internal Revenue Code does not apply; and 
  3.4      (2) the deduction for dividends paid under section 
  3.5   852(b)(2)(D) of the Internal Revenue Code must be applied by 
  3.6   allowing a deduction for capital gain dividends and 
  3.7   exempt-interest dividends as defined in sections 852(b)(3)(C) 
  3.8   and 852(b)(5) of the Internal Revenue Code.  
  3.9      The net income of a real estate investment trust as defined 
  3.10  and limited by section 856(a), (b), and (c) of the Internal 
  3.11  Revenue Code means the real estate investment trust taxable 
  3.12  income as defined in section 857(b)(2) of the Internal Revenue 
  3.13  Code.  
  3.14     The net income of a designated settlement fund as defined 
  3.15  in section 468B(d) of the Internal Revenue Code means the gross 
  3.16  income as defined in section 468B(b) of the Internal Revenue 
  3.17  Code. 
  3.18     The Internal Revenue Code of 1986, as amended through 
  3.19  December 31, 1986, shall be in effect for taxable years 
  3.20  beginning after December 31, 1986.  The provisions of sections 
  3.21  10104, 10202, 10203, 10204, 10206, 10212, 10221, 10222, 10223, 
  3.22  10226, 10227, 10228, 10611, 10631, 10632, and 10711 of the 
  3.23  Omnibus Budget Reconciliation Act of 1987, Public Law Number 
  3.24  100-203, the provisions of sections 1001, 1002, 1003, 1004, 
  3.25  1005, 1006, 1008, 1009, 1010, 1011, 1011A, 1011B, 1012, 1013, 
  3.26  1014, 1015, 1018, 2004, 3041, 4009, 6007, 6026, 6032, 6137, 
  3.27  6277, and 6282 of the Technical and Miscellaneous Revenue Act of 
  3.28  1988, Public Law Number 100-647, and the provisions of sections 
  3.29  7811, 7816, and 7831 of the Omnibus Budget Reconciliation Act of 
  3.30  1989, Public Law Number 101-239, shall be effective at the time 
  3.31  they become effective for federal income tax purposes.  
  3.32     The Internal Revenue Code of 1986, as amended through 
  3.33  December 31, 1987, shall be in effect for taxable years 
  3.34  beginning after December 31, 1987.  The provisions of sections 
  3.35  4001, 4002, 4011, 5021, 5041, 5053, 5075, 6003, 6008, 6011, 
  3.36  6030, 6031, 6033, 6057, 6064, 6066, 6079, 6130, 6176, 6180, 
  4.1   6182, 6280, and 6281 of the Technical and Miscellaneous Revenue 
  4.2   Act of 1988, Public Law Number 100-647, the provisions of 
  4.3   sections 7815 and 7821 of the Omnibus Budget Reconciliation Act 
  4.4   of 1989, Public Law Number 101-239, and the provisions of 
  4.5   section 11702 of the Revenue Reconciliation Act of 1990, Public 
  4.6   Law Number 101-508, shall become effective at the time they 
  4.7   become effective for federal tax purposes.  
  4.8      The Internal Revenue Code of 1986, as amended through 
  4.9   December 31, 1988, shall be in effect for taxable years 
  4.10  beginning after December 31, 1988.  The provisions of sections 
  4.11  7101, 7102, 7104, 7105, 7201, 7202, 7203, 7204, 7205, 7206, 
  4.12  7207, 7210, 7211, 7301, 7302, 7303, 7304, 7601, 7621, 7622, 
  4.13  7641, 7642, 7645, 7647, 7651, and 7652 of the Omnibus Budget 
  4.14  Reconciliation Act of 1989, Public Law Number 101-239, the 
  4.15  provision of section 1401 of the Financial Institutions Reform, 
  4.16  Recovery, and Enforcement Act of 1989, Public Law Number 101-73, 
  4.17  and the provisions of sections 11701 and 11703 of the Revenue 
  4.18  Reconciliation Act of 1990, Public Law Number 101-508, shall 
  4.19  become effective at the time they become effective for federal 
  4.20  tax purposes.  
  4.21     The Internal Revenue Code of 1986, as amended through 
  4.22  December 31, 1989, shall be in effect for taxable years 
  4.23  beginning after December 31, 1989.  The provisions of sections 
  4.24  11321, 11322, 11324, 11325, 11403, 11404, 11410, and 11521 of 
  4.25  the Revenue Reconciliation Act of 1990, Public Law Number 
  4.26  101-508, and the provisions of sections 13224 and 13261 of the 
  4.27  Omnibus Budget Reconciliation Act of 1993, Public Law Number 
  4.28  103-66, shall become effective at the time they become effective 
  4.29  for federal purposes.  
  4.30     The Internal Revenue Code of 1986, as amended through 
  4.31  December 31, 1990, shall be in effect for taxable years 
  4.32  beginning after December 31, 1990. 
  4.33     The provisions of section 13431 of the Omnibus Budget 
  4.34  Reconciliation Act of 1993, Public Law Number 103-66, shall 
  4.35  become effective at the time they became effective for federal 
  4.36  purposes.  
  5.1      The Internal Revenue Code of 1986, as amended through 
  5.2   December 31, 1991, shall be in effect for taxable years 
  5.3   beginning after December 31, 1991.  
  5.4      The provisions of sections 1936 and 1937 of the 
  5.5   Comprehensive National Energy Policy Act of 1992, Public Law 
  5.6   Number 102-486, and the provisions of sections 13101, 13114, 
  5.7   13122, 13141, 13150, 13151, 13174, 13239, 13301, and 13442 of 
  5.8   the Omnibus Budget Reconciliation Act of 1993, Public Law Number 
  5.9   103-66, shall become effective at the time they become effective 
  5.10  for federal purposes.  
  5.11     The Internal Revenue Code of 1986, as amended through 
  5.12  December 31, 1992, shall be in effect for taxable years 
  5.13  beginning after December 31, 1992.  
  5.14     The provisions of sections 13116, 13121, 13206, 13210, 
  5.15  13222, 13223, 13231, 13232, 13233, 13239, 13262, and 13321 of 
  5.16  the Omnibus Budget Reconciliation Act of 1993, Public Law Number 
  5.17  103-66, shall become effective at the time they become effective 
  5.18  for federal purposes. 
  5.19     The Internal Revenue Code of 1986, as amended through 
  5.20  December 31, 1993, shall be in effect for taxable years 
  5.21  beginning after December 31, 1993. 
  5.22     The provision of section 741 of Legislation to Implement 
  5.23  Uruguay Round of General Agreement on Tariffs and Trade, Public 
  5.24  Law Number 103-465, and the provisions of sections 1, 2, and 3, 
  5.25  of the Self-Employed Health Insurance Act of 1995, Public Law 
  5.26  Number 104-7, shall become effective at the time they become 
  5.27  effective for federal purposes. 
  5.28     The Internal Revenue Code of 1986, as amended through 
  5.29  December 31, 1994, shall be in effect for taxable years 
  5.30  beginning after December 31, 1994. 
  5.31     The Internal Revenue Code of 1986, as amended through March 
  5.32  22, 1996, is in effect for taxable years beginning after 
  5.33  December 31, 1995. 
  5.34     The provisions of Public Law Number 104-117 become 
  5.35  effective at the time they become effective for federal purposes.
  5.36     Except as otherwise provided, references to the Internal 
  6.1   Revenue Code in subdivisions 19a to 19g mean the code in effect 
  6.2   for purposes of determining net income for the applicable year. 
  6.3      Sec. 4.  Minnesota Statutes 1995 Supplement, section 
  6.4   290.01, subdivision 31, is amended to read: 
  6.5      Subd. 31.  [INTERNAL REVENUE CODE.] Unless specifically 
  6.6   defined otherwise, "Internal Revenue Code" means the Internal 
  6.7   Revenue Code of 1986, as amended through April 15, 1995 March 
  6.8   22, 1996, and includes the provisions of section 1(a) and (b) of 
  6.9   Public Law Number 104-117. 
  6.10     Sec. 5.  Minnesota Statutes 1995 Supplement, section 
  6.11  291.005, subdivision 1, is amended to read: 
  6.12     Subdivision 1.  Unless the context otherwise clearly 
  6.13  requires, the following terms used in this chapter shall have 
  6.14  the following meanings: 
  6.15     (1) "Federal gross estate" means the gross estate of a 
  6.16  decedent as valued and otherwise determined for federal estate 
  6.17  tax purposes by federal taxing authorities pursuant to the 
  6.18  provisions of the Internal Revenue Code. 
  6.19     (2) "Minnesota gross estate" means the federal gross estate 
  6.20  of a decedent after (a) excluding therefrom any property 
  6.21  included therein which has its situs outside Minnesota and (b) 
  6.22  including therein any property omitted from the federal gross 
  6.23  estate which is includable therein, has its situs in Minnesota, 
  6.24  and was not disclosed to federal taxing authorities.  
  6.25     (3) "Personal representative" means the executor, 
  6.26  administrator or other person appointed by the court to 
  6.27  administer and dispose of the property of the decedent.  If 
  6.28  there is no executor, administrator or other person appointed, 
  6.29  qualified, and acting within this state, then any person in 
  6.30  actual or constructive possession of any property having a situs 
  6.31  in this state which is included in the federal gross estate of 
  6.32  the decedent shall be deemed to be a personal representative to 
  6.33  the extent of the property and the Minnesota estate tax due with 
  6.34  respect to the property. 
  6.35     (4) "Resident decedent" means an individual whose domicile 
  6.36  at the time of death was in Minnesota. 
  7.1      (5) "Nonresident decedent" means an individual whose 
  7.2   domicile at the time of death was not in Minnesota. 
  7.3      (6) "Situs of property" means, with respect to real 
  7.4   property, the state or country in which it is located; with 
  7.5   respect to tangible personal property, the state or country in 
  7.6   which it was normally kept or located at the time of the 
  7.7   decedent's death; and with respect to intangible personal 
  7.8   property, the state or country in which the decedent was 
  7.9   domiciled at death. 
  7.10     (7) "Commissioner" means the commissioner of revenue or any 
  7.11  person to whom the commissioner has delegated functions under 
  7.12  this chapter. 
  7.13     (8) "Internal Revenue Code" means the United States 
  7.14  Internal Revenue Code of 1986, as amended through April 15, 1995 
  7.15  March 22, 1996, and includes the provisions of section 1(a)(4) 
  7.16  of Public Law Number 104-117. 
  7.17     Sec. 6.  [EFFECTIVE DATE.] 
  7.18     Sections 1, 4, and 5 are effective at the same time section 
  7.19  1 of Public Law Number 104-117 is effective.  Section 2 is 
  7.20  effective for taxable years beginning after December 31, 1994, 
  7.21  and claims for property tax refunds filed after the day of final 
  7.22  enactment.