Relating to taxation

ARTICLE 1 - RECODIFICATION

Recodifying and clarifying the powers of the commissioner of revenue; defining certain terms; enumerating certain powers and duties of the commissioner relating to the department, employees and assessors, to tax administration and enforcement, to the adoption of rules, to the publication of revenue notices, to the issuance of tax information bulletins, to preparation of the tax expenditure budget, tax information samples and tax incidence reports, to the collection of delinquent and local taxes, to examinations and investigations, to assessments, collections and refunds, to tax and penalty abatements, to erroneous remittances, to taxpayer assistance and to electronic payments; regulating tax preparation services; imposing personal tax collection or remittance liability on certain entities; providing for certain legal actions, for the creation of tax liens and for the sale and redemption of seized property; specifying the effect of the recodification on certain rules and repealed provisions; stating the intent of the legislature as simplification and consolidation; specifying certain recodification, publication and cross reference correction instructions to the revisor of statutes; appropriating money to the commissioner for various purposes and repealing certain existing statutory provisions governing the powers and duties of the commissioner

ARTICLE 2 - CONFORMING PROVISIONS

Making conforming amendments to certain statutory provisions relating to state debt collection, to the dry cleaner environmental response and reimbursement account, to liquefied petroleum gas sales, to health care provider taxes and surcharges, to arrearage collections, to boards of review and equalization, to mortgage registry and deed tax investigations, to general tax administration and compliance and to administration of the rental motor vehicle sales tax, the sales tax on motor vehicles, the solid waste management tax and insurance taxes;
specifying certain reference deletion and insertion instructions to the revisor of statutes

ARTICLE 3 - PROPERTY TAXES

Extending the deadlines for the commencement of construction of poultry litter biomass and certain hydroelectric electric generation facilities for personal property tax exemption purposes and modifying the location requirement for the hydroelectric facilities; expanding the personal property tax exemption for combined cycle combustion turbine electric generation facilities and providing exemptions for certain facilities exceeding a certain capacity and for certain simple cycle combustion turbine facilities; modifying the calculation of the sliding scale market value exclusion based on efficiency for electric power generation facility equipment property tax purposes; extending special agricultural homestead property tax treatment to property actively farmed by the grandson or granddaughter of the owner or of the spouse of the owner; clarifying the property tax classification of certain noncommercial aircraft storage hangars abutting public airports; authorizing commissioner of revenue earlier payment of property tax refund claims filed electronically; clarifying town spending and levy authority, prohibiting towns from spending or levying more than total revenue without voter approval, defining total revenue; expanding the authority of towns to collect unpaid service charges to nonresident recipients of services, requiring county auditors to remit to the towns service charges collected on behalf of the town; modifying certain requirements for the recapture of certain additional property taxes on certain qualified property in the city of Eagan used as an art park (Caponi) and repealing the authority of the city to defer the payment of special assessments on the property; extending the effective date for the levy authority of emergency medical services (EMS) special taxing districts and modifying the effective date for the property tax exemption for the disabled veterans rest camp on Big Marine Lake in Washington county; exempting certain school property from the property tax for taxes payable in 2005

ARTICLE 4 - PROPERTY TAX AIDS AND CREDITS

Delaying the annual date for state demographer preparation of population estimates for conveyance to local government units, requiring annual certification of estimates to the commissioner of revenue; modifying the residential homestead market value property tax credit; modifying the definition of population for taconite tax relief area revenue distribution purposes; expanding certain population estimate requirements of the metropolitan council, authorizing challenges; clarifying the definitions of population for metropolitan revenue distribution (fiscal disparities) and local government aid purposes and modifying the definition of city revenue need for certain cities; increasing the LGA city aid base for certain cities with a state park; clarifying the definitions of household size and population over age 65 for LGA purposes; modifying certain county tax base equalization aid provisions for and providing for court aid adjustments to Anoka and Washington, reducing the district court general fund appropriation; increasing the limit on the payment of total aids to counties; modifying a certain 2004 city aid reduction requirement and the definition of levy plus aid revenue base relating to county program aid for 2003 and 2004 county aid reduction purposes

ARTICLE 5 - DEPARTMENT OF REVENUE PROPERTY TAXES

Clarifying the treatment of manufactured home personal property taxes for payment statement purposes; clarifying the requirement for county assessor reporting of metropolitan revenue values in final abstracts of assessments; modifying the requirement for the commissioner of revenue to appoint special and deputy assessors for reappraisal of certain property; exempting property leased, loaned or otherwise made available to private individuals, corporations or associations under cooperative farming agreements or temporarily under housing and redevelopment authority redevelopment projects from the property tax; subjecting certain exempt property to certain additional limits; exempting from the tax certain property subject to the taconite production or net proceeds tax and certain property of religious corporations, children's homes, HRAs, regional rail authorities and the spirit mountain recreation area authority and defining installed capacity for tax exemption purposes; accelerating the annual deadline for wind energy conversion system owners to file production reports with the commissioner and modifying the distribution of revenues from the wind energy production tax; requiring counties to file certain homestead property information with the commissioner by electronic means; modifying the eligibility of certain family farm trust property for homestead classification; clarifying the requirement for the inclusion of certain information necessary for the certification of certain property as homestead property; modifying the definition of lease for tax exempt property purposes; defining the scope and clarifying the applicability of proceedings and appeals of utility or railroad valuations; modifying and clarifying certain provisions relating to local boards of appeal and equalization; modifying certain certification and reporting requirements for city, town, county and school district taxes; changing a certain county treasurer full settlement deadline; modifying certain tax-forfeited land provisions; expanding the prohibition on the purchase of tax-forfeited lands to county attorneys; modifying the apportionment of proceeds of tax-forfeited land sales to taxing districts and the requirement to restore to the tax rolls forfeited agricultural lands and clarifying certain conveyance form and payment receipt requirements; including special assessments in the calculation of deferred property tax amounts for senior citizens; clarifying certain annual certification requirements under the sustainable forest resource management incentive program, providing for the length of covenants and clarifying the early withdrawal procedure in the case of eminent domain; modifying certain aid reduction authority of the commissioner of finance relating to the county building debt state guarantee; modifying the authority of cities to transfer border city development zone allocations to reimburse the city or county for property tax reductions; modifying the effective date of certain provisions eliminating certain county allocations to the state; authorizing towns in Lincoln and Pipestone counties to adjust the payable 2004 levy for estimated wind energy production tax amounts; repealing certain provisions relating to property used for the production of hydropower, the county auditor assessment books certificate issuance requirement, voter approved levies, the taxation of railroad property and certain wind energy conversion facilities and the alternate levy authority of local government units for certain payments to the Alexandria area sanitary sewer board

ARTICLE 6 - INCOME, CORPORATE FRANCHISE AND ESTATE TAXES

Requiring corporations claiming payment of taxes in excess of the amount due to include on returns information necessary for payment of the tax in excess of the amount due by electronic means; modifying the filing date for corporate filing of returns for a fractional part of a year; strengthening the authority of the commissioner to extend the time limit for filing estate tax returns; imposing a time limit on requests for calculation of separate liability for taxes reported on joint income tax returns; authorizing the filing of amended corporate franchise tax returns reflecting federal tax changes; extending the provision providing for filing extensions for service members; imposing a penalty for false or fraudulent claims for refund; expanding the civil penalty for understatement of tax liability to reckless disregard of laws or rules; modifying the definition of resident trust; modifying the addition to federal taxable income of income taxes paid to other states and creating an exception to the addition of the amount of expense, interest or taxes disallowed as nondeductible items; eliminating the subtraction from federal taxable income of postservice benefits for youth community and certain volunteer service, retroactively providing for the subtraction of delayed depreciations by S corporations and eliminating the subtraction for environmental taxes; modifying certain definitions relating to earned and adjusted gross income for working family income tax credit purposes and making certain technical corrections to the education credit; exempting publicly traded partnerships from certain income tax withholding requirements for nonresident partners; requiring calculation of the estate tax amount using Minnesota adjusted taxable estate in lieu of federal adjusted taxable estate, defining Minnesota adjusted taxable estate; repealing certain rules relating to corporate estimated tax declarations

ARTICLE 7 - SALES AND USE TAXES

Clarifying the inclusion of the use tax in a certain provision limiting the time for assessment of certain omitted taxes and the limit on sales and use tax refund claims for bad debt loss; imposing certain time limits on purchaser filed and capital equipment refund claims; expanding the definition of sale or purchase for general sales tax purposes to dietary supplements; clarifying the sales tax on lodging and related services; clarifying the definition of retail sale relating to the normal course of business; clarifying certain exemptions from the motor vehicle rental tax; removing the application of the sourcing rule to watercraft, aircraft and modular, manufactured or mobile homes; adding aircraft and certain transportation equipment containers to the list of items subject to the sourcing provisions for transportation equipment; modifying the sales tax exemptions for certain medicines and medical devices and for baby products; excluding certain services from the definition of industrial production for exemption clarification purposes; clarifying the exemption for certain electronic equipment, expanding the exemption for ready mixed concrete equipment to parts for ready mixed concrete trucks and excluding certain additional machinery and equipment from the definition of capital equipment; clarifying the sales tax exemption for medical equipment and excluding nonprescription drugs from the definition of medical supplies; clarifying the exemptions for tangible personal property or services under preexisting bids or contracts and for chair lifts, ramps and elevators; exempting from the tax certain occasional sales at flea markets and similar selling events, specifying certain written statement requirements; modifying the local sales tax base; repealing certain obsolete sales tax rules

ARTICLE 8 - SPECIAL TAXES

Exempting mortgages on armory buildings from the mortgage registry tax; modifying the formula for determination of underpayments of estimated gross earnings taxes by furriers; granting the commissioner of revenue certain petroleum tax nonpayment penalties abatement authority; applying certain gambling tax provisions to linked bingo games and modifying the requirement for gambling organizations to keep cancelled checks; clarifying the application of the cigarette transport report requirement for tobacco tax purposes and authorizing the commissioner to require the furnishing of a corporate surety bond or certified check to guarantee payment of tax stamps purchased by distributors; clarifying the payment dates for cigarette and tobacco products distributors subject to accelerated May or June tax payment liability; modifying the bad debt refund for tobacco taxes paid; providing for quarterly or annual tax payments by certain liquor manufacturers, wholesalers, brewers and importers; defining reinsurance for insurance gross premium tax purposes and clarifying the imposition of the tax on health maintenance organizations (HMO), nonprofit health service plan corporations and community integrated service networks (CISN); clarifying the taconite production tax rate for certain direct reduced ore, prohibiting imposition of the tax during noncommercial production of the ore; modifying the definition of commercial production; clarifying the application of certain audit, penalty and enforcement provisions payment of the metropolitan solid waste landfill fee; repealing a certain provision providing for the crediting of civil penalty payments for gambling tax violations

ARTICLE 9 - MISCELLANEOUS

Authorizing case reviewers under the state debt collection procedure to issue debtor assistance orders under certain unjust or inequitable results determination conditions and transferring duties and authority of case reviewers to the taxpayer rights advocate; modifying certain provisions regulating tax preparation services, providing for the referral of certain complaints, classifying the data exchanged, expanding exemptions, requiring and providing for commissioner of revenue publication of names of tax preparers subject to penalties; specifying the assessment date in consent agreement cases; requiring compromise proposals relating to tax liability to be accompanied by a nonrefundable payment and providing for application of the payment; authorizing the transcription of lien notices to the secretary of state; clarifying the definition of debt under the revenue recapture act to include fines imposed for petty misdemeanors for collection purposes; expanding the requirement for tax preparers to file income tax returns electronically; authorizing the sending of assessment orders by electronic mail (e-mail); modifying and clarifying certain civil penalty provisions; clarifying the definition of employer for income tax withholding purposes; eliminating the authority of the commissioner to revoke the licenses of certain cigarette distributors selling cigarettes below cost
(CH. 151, 2005)