Minnesota Legislature
SF 2405
1st Engrossment - 93rd Legislature (2023 - 2024) Posted on 04/04/2024 01:08pm
Current Version - 1st Engrossment
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A bill for an act
relating to taxation; income, aids, and local sales and use; modifying the calculation
of the standard deduction and definitions for the statewide local housing aid;
amending the local sales and use tax authorization for Beltrami County; amending
Minnesota Statutes 2022, section 290.0123, subdivisions 1, 2; Minnesota Statutes
2023 Supplement, sections 290.0123, subdivision 3; 477A.36, subdivisions 1, 6;
Laws 2023, chapter 64, article 10, section 25.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2022, section 290.0123, subdivision 1, is amended to read:
Subdivision 1.
Standard deduction amount.
A taxpayer's standard deduction equals:
(1) for a married joint filer or a surviving spouse, deleted text begin $24,400deleted text end new text begin $27,650new text end ;
(2) for a head of household filer, deleted text begin $18,350deleted text end new text begin $20,800new text end ; or
(3) for any other filer, one-half the amount in clause (1); plus
(4) the additional amount for the taxpayer under subdivision 2.
A taxpayer's standard deduction amount is reduced in accordance with subdivision 5.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective retroactively for taxable years beginning
after December 31, 2022.
new text end
Sec. 2.
Minnesota Statutes 2022, section 290.0123, subdivision 2, is amended to read:
Subd. 2.
Additional amount for seniors or blind taxpayers.
(a) The additional amount
equals the sum of the following amounts:
(1) deleted text begin $1,300deleted text end new text begin $1,450new text end if the taxpayer has attained age 65 before the close of the taxable year
or deleted text begin $1,650deleted text end new text begin $1,850new text end for such a taxpayer who is not married or a surviving spouse;
(2) deleted text begin $1,300deleted text end new text begin $1,450new text end for the spouse of the taxpayer if the spouse has attained the age of 65
before the close of the taxable year and qualifies for an exemption under section 151(b) of
the Internal Revenue Code;
(3) deleted text begin $1,300deleted text end new text begin $1,450new text end if the taxpayer is blind at the close of the taxable year or deleted text begin $1,650deleted text end new text begin $1,850new text end
for such a taxpayer who is not married or a surviving spouse; and
(4) deleted text begin $1,300deleted text end new text begin $1,450new text end for the spouse of the taxpayer if the spouse is blind as of the close of
the taxable year and qualifies for an exemption under section 151(b) of the Internal Revenue
Code.
(b) The commissioner must disregard section 151(d)(5) of the Internal Revenue Code
when determining if the taxpayer's spouse is eligible for an exemption under paragraph (a).
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective retroactively for taxable years beginning
after December 31, 2022.
new text end
Sec. 3.
Minnesota Statutes 2023 Supplement, section 290.0123, subdivision 3, is amended
to read:
Subd. 3.
Amount for dependents.
For an individual who is a dependent, as defined in
sections 151 and 152 of the Internal Revenue Code, of another taxpayer for a taxable year
beginning in the calendar year in which the individual's taxable year begins, the standard
deduction for that individual is limited to the greater of:
(1) deleted text begin $1,100deleted text end new text begin $1,200new text end ; or
(2) the lesser of: (i) the sum of $350 and that individual's earned income; or (ii) the
standard deduction amount allowed under subdivision 1, clause (3).
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective retroactively for taxable years beginning
after December 31, 2022.
new text end
Sec. 4.
Minnesota Statutes 2023 Supplement, section 477A.36, subdivision 1, is amended
to read:
Subdivision 1.
Definitions.
For the purposes of this section, the following terms have
the meanings given:
(1) "city distribution factor" means the number of households in a tier I city that are
cost-burdened divided by the total number of households that are cost-burdened in Minnesota
tier I cities. The number of cost-burdened households shall be determined using the most
recent estimates or experimental estimates provided by the American Community Survey
of the United States Census Bureau as of May 1 of the aid calculation year;
(2) "cost-burdened household" means a household in which gross rent is 30 percent or
more of household income or in which homeownership costs are 30 percent or more of
household income;
(3) "county distribution factor" means the number of households in a county that are
cost-burdened divided by the total number of households in Minnesota that are cost-burdened.
The number of cost-burdened households shall be determined using the most recent estimates
or experimental estimates provided by the American Community Survey of the United
States Census Bureau as of May 1 of the aid calculation year;
(4) "eligible Tribal Nation" meansnew text begin any ofnew text end the deleted text begin followingdeleted text end new text begin 11new text end federally recognized Indian
Tribes located in Minnesotadeleted text begin : Bois Forte Band; Fond du Lac Band; Grand Portage Band;
Leech Lake Band; Mille Lacs Band; White Earth Band; and Red Lake Nationdeleted text end new text begin which submit
an application under subdivision 6, paragraph (g)new text end ;
(5) "population" has the meaning given in section 477A.011, subdivision 3;
(6) "tier I city" means a statutory or home rule charter city that is a city of the first,
second, or third class and is not located in a metropolitan county, as defined by section
473.121, subdivision 4; and
(7) "tier II city" means a statutory or home rule charter city that is a city of the fourth
class and is not located in a metropolitan county, as defined by section 473.121, subdivision
4.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids payable in calendar year 2024
and thereafter.
new text end
Sec. 5.
Minnesota Statutes 2023 Supplement, section 477A.36, subdivision 6, is amended
to read:
Subd. 6.
Administration.
(a) The commissioner of revenue must compute the amount
of aid payable to each aid recipient under this section. Beginning with aids payable in
calendar year 2024, before computing the amount of aid for counties and after receiving
the report required by subdivision 3, paragraph (e), the commissioner shall compute the
amount necessary to increase the amount in the account or accounts established under that
paragraph to $1,250,000. The amount calculated under the preceding sentence shall be
deducted from the amount available to counties for the purposes of certifying the amount
of aid to be paid to counties in the following year. By August 1 of each year, the
commissioner must certify the amount to be paid to each deleted text begin aid recipientdeleted text end new text begin tier I city and countynew text end
in the following year. The commissioner must pay statewide local housing aidnew text begin to tier I cities
and countiesnew text end annually at the times provided in section 477A.015. Before paying the first
installment of aid annually, the commissioner of revenue shall transfer to the Minnesota
Housing Finance Agency from the funds available for counties, for deposit in the account
or accounts established under subdivision 3, paragraph (e), the amount computed in the
prior year to be necessary to increase the amount in the account or accounts established
under that paragraph to $1,250,000.
(b) Beginning in 2025, aid recipients shall submit a report annually, no later than
December 1 of each year, to the Minnesota Housing Finance Agency. The report shall
include documentation of the location of any unspent funds distributed under this section
and of qualifying projects completed or planned with funds under this section. If an aid
recipient fails to submit a report, fails to spend funds within the timeline imposed under
subdivision 5, paragraph (b), or uses funds for a project that does not qualify under this
section, the Minnesota Housing Finance Agency shall notify the Department of Revenue
and the aid recipient must repay funds under paragraph (c) by February 15 of the following
year.
(c) By May 15, after receiving notice from the Minnesota Housing Finance Agency, an
aid recipient must pay to the Minnesota Housing Finance Agency funds the aid recipient
received under this section if the aid recipient:
(1) fails to spend the funds within the time allowed under subdivision 5, paragraph (b);
(2) spends the funds on anything other than a qualifying project; or
(3) fails to submit a report documenting use of the funds.
(d) The commissioner of revenue must stop distributing funds to an aid recipient that
the Minnesota Housing Finance Agency reports to have, in three consecutive years, failed
to use funds, misused funds, or failed to report on its use of funds.
(e) The commissioner may resume distributing funds to an aid recipient to which the
commissioner has stopped payments in the year following the August 1 after the Minnesota
Housing Finance Agency certifies that the city or county has submitted documentation of
plans for a qualifying project.
(f) By June 1, any funds paid to the Minnesota Housing Finance Agency under paragraph
(c) must be deposited in the housing development fund. Funds deposited under this paragraph
are appropriated to the commissioner of the Minnesota Housing Finance Agency for use
on the family homeless prevention and assistance program under section 462A.204, the
economic development and housing challenge program under section 462A.33, and the
workforce and affordable homeownership development program under section 462A.38.
(g) An eligible Tribal Nation may choose to receive an aid distribution under this section
by submitting an application under this subdivision. An eligible Tribal Nation which has
not received a distribution in a prior aids payable year may elect to begin participation in
the program by submitting an application in the manner and form prescribed by the
commissioner of revenue by January 15 of the aids payable year. In order to receive a
distribution, an eligible Tribal Nation must certify to the commissioner of revenue the most
recent estimate of the total number of enrolled members of the eligible Tribal Nation. The
information must be annually certified by March 1 in the form prescribed by the
commissioner of revenue. The commissioner of revenue must annually calculate and certify
the amount of aid payable to each eligible Tribal Nation on or before August 1new text begin of the aids
payable yearnew text end .new text begin The commissioner of revenue must pay statewide local housing aid to eligible
Tribal Nations annually by December 27 of the year the aid is certified.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids payable in calendar year 2024
and thereafter.
new text end
Sec. 6.
Laws 2023, chapter 64, article 10, section 25, is amended to read:
Sec. 25. BELTRAMI COUNTY; TAXES AUTHORIZED.
Subdivision 1.
Sales and use tax authorization.
Notwithstanding Minnesota Statutes,
section 297A.99, deleted text begin subdivisiondeleted text end new text begin subdivisionsnew text end 1new text begin and 3new text end , or 477A.016, or any other law or
ordinance, and if approved by the voters at an election deleted text begin as required under Minnesota Statutes,
section 297A.99, subdivision 3deleted text end new text begin held on November 7, 2023new text end , Beltrami County may impose
by ordinance a sales and use tax of five-eighths of one percent for the purpose specified in
subdivision 2. Except as otherwise provided in this section, the provisions of Minnesota
Statutes, section 297A.99, govern the imposition, administration, collection, and enforcement
of the tax authorized under this subdivision. The tax imposed under this subdivision is in
addition to any local sales and use tax imposed under any other special law.
Subd. 2.
Use of sales and use tax revenues.
The revenues derived from the tax authorized
under subdivision 1 must be used by Beltrami County to pay the costs of collecting and
administering the tax, and to finance up to $80,000,000, plus associated bonding costs, for
the construction of a new county jail.
Subd. 3.
Bonding authority.
(a) Beltrami County may issue bonds under Minnesota
Statutes, chapter 475, to finance the costs of the facility authorized in subdivision 2. The
aggregate principal amount of bonds issued under this subdivision may not exceed
$80,000,000 for the project listed in subdivision 2, plus an amount to be applied to the
payment of the costs of issuing the bonds. The bonds may be paid from or secured by any
funds available to the county, including the tax authorized under subdivision 1. The issuance
of bonds under this subdivision is not subject to Minnesota Statutes, sections 275.60 and
275.61.
(b) The bonds are not included in computing any debt limitation applicable to the county,
and any levy of taxes under Minnesota Statutes, section 475.61, to pay principal and interest
on the bonds is not subject to any levy limitation. A separate election to approve the bonds
under Minnesota Statutes, section 475.58, is not required.
Subd. 4.
Termination of taxes.
Subject to Minnesota Statutes, section 297A.99,
subdivision 12, the tax imposed under subdivision 1 expires at the earlier of: (1) 30 years
after the tax is first imposed; or (2) when the county board determines that the amount
received from the tax is sufficient to pay $80,000,000 in project costs authorized under
subdivision 2, plus an amount sufficient to pay the costs related to issuance of any bonds
authorized under subdivision 3, including interest on the bonds. Except as otherwise provided
in Minnesota Statutes, section 297A.99, subdivision 3, paragraph (f), any funds remaining
after payment of the allowed costs due to the timing of the termination of the tax under
Minnesota Statutes, section 297A.99, subdivision 12, shall be placed in the general fund of
the county. The tax imposed under subdivision 1 may expire at an earlier time if the county
so determines by ordinance.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective retroactively from November 7, 2023.
new text end
Sec. 7. new text begin APPLICATIONS OF TRIBAL NATIONS FOR STATEWIDE HOUSING
AIDS PAYABLE IN 2024.
new text end
new text begin
For aids payable in 2024, the application and enrollment information required under
Minnesota Statutes, section 477A.36, subdivision 6, paragraph (g), may be submitted as
late as June 30, 2024. The commissioner may recertify, no later than August 1, 2024, the
amount of statewide local housing aid payable to each Tribal Nation for aids payable in
calendar year 2024.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids payable in calendar year 2024.
new text end