HF 1689

as introduced - 92nd Legislature (2021 - 2022) Posted on 03/01/2021 04:00pm

A bill for an act
relating to taxation; income; requiring an addition for deemed capital gains on
certain assets of a decedent; amending Minnesota Statutes 2020, sections 289A.19,
by adding a subdivision; 290.0131, by adding a subdivision; proposing coding for
new law in Minnesota Statutes, chapter 290.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2020, section 289A.19, is amended by adding a subdivision
to read:

new text begin Subd. 8. new text end

new text begin Returns including nontaxed capital gains. new text end

new text begin The commissioner must grant an
automatic extension of 275 days to file an individual income tax return that includes an
amount added to an individual's federal adjusted gross income under section 290.0131,
subdivision 19. Where good cause exists, the commissioner may grant an extension of an
additional 180 days for filing this return.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after December
31, 2020.
new text end

Sec. 2.

Minnesota Statutes 2020, section 290.0131, is amended by adding a subdivision
to read:

new text begin Subd. 19. new text end

new text begin Nontaxed capital gains. new text end

new text begin The amount of nontaxed capital gains as determined
under section 290.055 that exceeds $1,000,000 is an addition.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after December
31, 2020.
new text end

Sec. 3.

new text begin [290.055] NONTAXED CAPITAL GAINS.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For purposes of this section, the following terms have
the meanings given.
new text end

new text begin (b) "Federal gross estate" means the gross estate of a decedent as required to be valued
and otherwise determined for federal estate tax purposes under the Internal Revenue Code.
new text end

new text begin (c) "Nontaxed capital asset" means a capital asset as defined in section 1221(a) of the
Internal Revenue Code, but does not include land classified as class 2a agricultural homestead
as determined under chapter 273.
new text end

new text begin Subd. 2. new text end

new text begin Determination of nontaxed capital gains. new text end

new text begin A taxpayer's nontaxed capital gains
equals the sum of the gains on each nontaxed capital asset owned by a taxpayer on the date
of the taxpayer's death. The amount of each gain is equal to the amount that would be
required to be included in the taxpayer's federal adjusted gross income if the asset was sold
on the date of the taxpayer's death at a value equal to the value of the asset if it was includable
in the decedent's federal gross estate.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after December
31, 2020.
new text end