HF 138

SPECIAL SESSION CHAPTER 3
EFFECTIVE DATE: Various

ARTICLE 1--PROPERTY TAXES

Section 1: Manufactured home delinquent taxes modified.
Sec. 2: Commissioner notification of county auditor required.
Sec. 3: Rental housing property qualifications determined.
Sec. 4: Wind energy conversation systems exempted.
Sec. 5: Property subject to taconite production tax modified.
Sec. 6: Biomass Electric Generation Facility Personal Property exemption provided.
Sec. 7: Training and education of property tax personnel. regulations modified.
Sec. 8: Limited market value extended.
Sec. 9: Valuation reduction for homesteads damaged by mold provided.
Sec. 10: Lead hazard market value reduction provided.
Sec. 11: Open space valuation for land used for polo provided.
Sec. 12: Homestead used for licensed child care property tax classification regulated.
Sec. 13: Manufactured homes designation as personal property regulated.
Sec. 14: Certification of low-income rental property modified.
Sec. 15: Class 1c homestead resorts classification restructured.
Sec. 16: Class 4d low-income housing reinstituted for qualifying low-income rental housing.
Sec. 17: Vacant commercial-industrial properties disparity reduction credit authorized.
Sec. 18: Local board of review adjustment provision clarified.
Sec. 19: Seasonal recreational tax capacity provided.
Sec. 20: Apportionment and levy of the state general tax modified.
Sec. 21: Date to certify levies and tax rates modified.
Sec. 22: Proposed property taxes supplemental information specified relating to Ramsey County library.
Sec. 23: Truth-in-taxation joint hearings authorized for Aitkin County.
Sec. 24: Truth-in-taxation joint hearings authorized for Nobles County.
Sec. 25: Cruelty to animals special levy provided.
Sec. 26: Ramsey County library levy and regional rail authorities property tax statement provided.
Sec. 27: Taconite tax rate one year freeze provided.
Sec. 28: HRA levy limit provided.
Sec. 29: St. Paul airport fiscal disparities exclusion clarified.
Sec. 30: Bloomington supplemental fiscal disparities contribution delayed.
Sec. 31: Land utilization project land recategorized.
Sec. 32: "Land utilization project land" established as a separate category.
Sec. 33: LUP land payment in-lieu of tax (PILT) payments increased for LUP lands.
Sec. 34: LUP land certification required.
Sec. 35: LUP land general distribution modified.
Sec. 36: Lakeview cemetery levy increased.
Sec. 37: Standardized assessment and classification standards report required.
Sec. 38: Code of conduct and ethics development for assessors required.
Sec. 39: Dakota County regional railroad authorization authorized.
Sec. 40: Assessment of assisted living facilities required.

ARTICLE 2: PROPERTY TAX AIDS AND CREDITS

Section 1: City aid base increase provided.
Sec. 2: City formula aid modified.
Sec. 3: LGA appropriation increased.
Sec. 4: County technical correction provided.
Sec. 5: Market value credit reimbursement reductions extended.

ARTICLE 3: INCOME AND FRANCHISE TAXES

Section 1: Filing requirements for military personnel modified.
Sec. 2: Bonus depreciation on composite partnerships included.
Sec. 3: Local use tax provisions modified.
Sec. 4: Nonresident income withholding payment regulations modified.
Sec. 5: Foreign operating corporation definition modified.
Sec. 6: Nonresident definition modified.
Sec. 7: Subtractions from individuals' taxable income authorized relating to national guard and military service.
Sec. 8: Dependent care credit subtractions included in apportionment.
Sec. 9: Working family credit subtractions for military pay included in apportionment.
Sec. 10: K-12 education credit limit removed.
Sec. 11: Alternative minimum tax subtraction adjusted gross income threshold removed for certain circumstances.
Sec. 12: Cooperatives organized.
Sec. 13: Single factor sales apportionment provided for regular corporations.
Sec. 14: Single factor sales apportionment provided for financial institutions.
Sec. 15: Withholding by contractors required.
Sec. 16: Apportionment of occupation tax on nonferrous metals modified.
Sec. 17: Apportionment of occupation tax on taconite and iron ore modified.

ARTICLE 4¿FEDERAL UPDATE

Section 1: Internal revenue code date modified.
Sec. 2: Net income definition modified.
Sec. 3: Federal Taxable Income definition modified.
Sec. 4: Federal Taxable Income subtractions
Sec. 5: Corporate additions to federal taxable income modified.
Sec. 6: Corporate modifications decreasing federal taxable income modified.
Sec. 7: Internal Revenue Code date modified / conform with section 1.
Sec. 8: Technical federal Act language references inserted.
Sec. 9: Computation procedure modified.
Sec. 10: Technical references added.
Sec. 11: Combat pay exclusion not considered ¿earned income.¿
Sec. 12: Income definition modified.
Sec. 13: Conforming change.
Sec. 14: ¿Earned income of lesser earning spouse¿ definition modified.
Sec. 15: Technical references added.
Sec. 16: Conforming changes with section 12.
Sec. 17: ¿Internal Revenue Code¿ definition modified.

ARTICLE 5 ¿ SALES AND USE TAXES

Section 1: Contracts with foreign vendors regulated.
Sec. 2: Tax return requirement relating to trade or business regulations modified.
Sec. 3: ¿Sale¿ and ¿purchase¿ definitions modified.
Sec. 4: ¿Retail sale¿ definition modified.
Sec. 5: Tax exempt meals regulations clarified.
Sec. 6: Solar energy products exemption provided.
Sec. 7: Taxed cigarettes exemption provided.
Sec. 8: Industrial production materials exemption modified.
Sec. 9: Capital equipment exemption modified.
Sec. 10: Telecommunications equipment exemption modified.
Sec. 11: Land clearing contract defined.
Sec. 12: Regionwide public safety radio communication system exemption clarified.
Sec. 13: Nonprofit admissions ticket exemptions clarified.
Sec. 14: Hydroelectric generating facility construction materials exemption provided.
Sec. 15: Waste recovery facility materials exemption provided.
Sec. 16: Municipal utility exemption provided.
Sec. 17: Chatfield wastewater treatment facility exemption provided.
Sec. 18: Tax collection exemption provided for municipal electric facilities.
Sec. 19: Eligible persons refund regulations modified.
Sec. 20: Technical.
Sec. 21: Motor vehicle lease price payment taxation regulations established.
Sec. 22: Political subdivision legal debt to state regulations clarified.
Sec. 23: Use tax notification procedures relating to political subdivisions established.
Sec. 24: Use limitations specified for city revenues.
Sec. 25: Taxing authority expenditure date modified.
Sec. 26: Calendar year bond issuance regulated.
Sec. 27: Conforming changes relating to bond issuance.
Sec. 28: Revenue usage for transportation infrastructure and other city utilities modified.
Sec. 29: Bonding authority election requirements provided.
Sec. 30: Tax termination provided.
Sec. 31: Effective dates modified.
Sec. 32: Effective date modified.
Sec. 33: Repealer modified.
Sec. 34: Technical.
Sec. 35: Waite Park voter approval requirements modified.
Sec. 36: City tax imposition and termination regulations modified.
Sec. 37: St. Cloud sales and use tax authorized.
Sec. 38: Albert Lea sales and use tax authorized.
Sec. 39: Bemidji sales and use tax authorized.
Sec. 40: Hubbard county authority lodging tax authorized.
Sec. 41: Proctor lodging tax authorized.
Sec. 42: Willmar sales and use tax authorized.
Sec. 43: Winona sales and use tax authorized.
Sec. 44: Worthington sales and use and excise taxes authorized and bonding authority provided.

ARTICLE 6¿SPECIAL TAXES

Section 1: ¿Consideration¿ definition modified.
Sec. 2: ¿Designated transfer¿ defined.
Sec. 3: ¿Reorganization¿ defined.
Sec. 4: Tax determination on real property procedures modified.
Sec. 5: ¿Blood components¿ defined.
Sec. 6: ¿Gross revenues¿ definition modified.
Sec. 7: Prescription drugs use tax imposed.
Sec. 8: Exemption provided for blood components.
Sec. 9: Liquor gross receipts tax imposed.
Sec. 10: Exemptions clarified.
Sec. 11: ¿Out-of-state retailer¿ defined.
Sec. 12: Registration requirement relating to tobacco products provided.
Sec. 13: Reporting requirements modified.
Sec. 14: Tax and use tax on cigarettes modified.
Sec. 15: Cigarette sales tax imposed.
Sec. 16: ¿Direct business¿ defined.
Sec. 17: ¿Reinsurance¿ definition modified.
Sec. 18: Mutual property and casualty companies tax imposition modified.
Sec. 19: Life insurance tax imposed.
Sec. 20: Tobacco product delivery sales requirements specified.
Sec. 21: Floor stocks tax imposed.

ARTICLE 7¿ECONOMIC DEVELOPMENT

Section 1: ¿Residence¿ defined.
Sec. 2: Wage and job goals modified.
Sec. 3: Public notice and hearing regulations modified.
Sec. 4: Compilation and summary report requirements clarified.
Sec. 5: Enforcement provision established relating to taxable property.
Sec. 6: Job opportunity building zone property tax regulations modified.
Sec. 7: Biotechnology and health sciences industry zone refunds interest computation procedures specified.
Sec. 8: Job opportunity building zones exemptions modified.
Sec. 9: Biotechnology and health sciences industry zone conforming changes provided.
Sec. 10: Nine-member boards authorized for county economic development authorities.
Sec. 11: Border city allocations provided.
Sec. 12: Public utility specified as not being a qualified business.
Sec. 13: ¿Relocation payroll percentage¿ defined.
Sec. 14: Individual income tax exemption clarified relating to estates and trusts.
Sec. 15: Corporate franchise tax exemption clarified.
Sec. 16: Corporate franchise tax exemption clarified.
Sec. 17: Ramsey housing tax increment district creation authorized.
Sec. 18: Rural finance authority appropriation provided.
Sec. 19: JOBZ expenditure limitations and determination procedures established.
Sec. 20: Repealer.

ARTICLE 8¿TAX SHELTERS

Section 1: Equitable actionws authorized.
Sec. 2: Tax shelter special rules established.
Sec. 3: Reportable transactions detailed.
Sec. 4: Substantial understatement of liability penalty imposition regulations modified.
Sec. 5: Abusive tax shelter promotion penalty clarified.
Sec. 6: Aiding and abetting understating of tax liability regulations established.
Sec. 7: Tax shelter registration and listing penalties established.
Sec. 8: Reportable transaction understatement tax addition established.
Sec. 9: Voluntary compliance initiative established and detailed.

ARTICLE 9¿DEPARTMENT OF REVENUE ELECTRONIC PAYMENTS

Section 1: Electronic payment regulation limits modified.
Sec. 2: Sales and use tax regulation limits modified.
Sec. 3: Electronic payment limits modified.
Sec. 4: Conforming change.
Sec. 5: Effective date.

ARTICLE 10¿INTERNATIONAL ECONOMIC DEVELOPMENT ZONE

Section 1: International economic development zone property improvements exemption provided.
Sec. 2: Federal taxable income subtractions authorization modified.
Sec. 3: ¿Taxable income¿ definition modified.
Sec. 4: Rate schedules for individuals, estates, and trusts modified.
Sec. 5: International economic development zone job credit authorized.
Sec. 6: Credit amount modified.
Sec. 7: Credit authorization modified.
Sec. 8: Definitions modified.
Sec. 9: Alternative minimum taxable income definition modified.
Sec. 10: IEDZ entity exemptions clarified.
Sec. 11: ¿Minnesota property¿ and ¿Minnesota payrolls¿ definitions modified.
Sec. 12: International economic development zone purchases modified.
Sec. 13: Related term definitions provided.
Sec. 14: Designation application regulations established.
Sec. 15: International economic development zone designations provided.
Sec. 16: Foreign trade zone authority powers regulated and regional distribution center development authorized.
Sec. 17: International Economic Development Zone tax incentive availability detailed.
Sec. 18: Individual income tax exemption application procedure provided.
Sec. 19: Corporate franchise tax exemption provided.
Sec. 20: Jobs credit authorized.
Sec. 21: Tax benefit repayment detailed.
Sec. 22: Reporting requirements established.
Sec. 23: Business grants provided.

ARTICLE 11¿MISCELLANEOUS

Section 1: Staff appointment authority modified.
Sec. 2: Technical reference modified.
Sec. 3: Statement to accompany distribution clarified.
Sec. 4: Nongame wildlife checkoff notification by paid tax preparer required.
Sec. 5: Failure to file penalty established.
Sec. 6: Public health care program tax regulations clarified.
Sec. 7: Fee studies required.
Sec. 8: Transfer from tax relief account to general fund provided.
Sec. 9: Taxpayer assistance services funded and money appropriated.
Sec. 10: Veterans services money appropriated.
Sec. 11: Otter tail county disaster relief money appropriated.
Sec. 12: Department of revenue money appropriated.
Sec. 13: Revisor instruction.
Sec. 14: Effective date.

AME