Minnesota Legislature
Office of the Revisor of Statutes
Minnesota Session Laws - 1990, Regular Session
Key: (1) language to be deleted (2) new language
Laws of Minnesota 1990
CHAPTER 480-H.F.No. 2480
An act relating to taxation; recodifying and providing
for the administration of certain taxes; making
corrections and changes in the administration,
collection, and enforcement of taxes, aids, credits,
and refunds; transferring certain powers and duties;
granting certain powers to counties; imposing
penalties; amending Minnesota Statutes 1988, sections
60A.198, by adding a subdivision; 69.771, subdivision
3; 69.772, subdivision 2a; 69.774, subdivision 1;
116K.04, subdivision 4; 270.65; 270.67, subdivisions 1
and 2; 270.68, subdivisions 1 and 3; 270.69,
subdivisions 2, 3, 7, 8, and by adding a subdivision;
270.70, subdivision 1; 270A.03, subdivisions 2, 5, and
7; 270A.04, subdivision 2; 270A.08, subdivision 2;
274.01, subdivision 1; 275.54; 276.111; 277.15;
279.03, subdivision 2, and by adding a subdivision;
279.37, subdivision 1a; 282.01, subdivision 4; 282.09,
subdivision 1; 282.261, subdivision 2; 287.21,
subdivision 2; 290.05, subdivision 4; 290.17,
subdivision 5; 290.39, subdivision 5; 290.49,
subdivision 3; 290.92, subdivisions 6a, 12, 23, and
24; 290.93, subdivision 1; 290A.03, subdivision 3;
290A.04, subdivision 1; 290A.07, subdivision 3;
290A.19; 296.06, subdivision 2; 296.18, subdivisions 2
and 3; 296.25; 297A.01, subdivision 8; 297A.03,
subdivision 2; 297A.041; 297A.14, subdivision 1;
297A.18; 297A.211, subdivision 3; 297A.25, subdivision
31; 297A.255, by adding a subdivision; 297B.035,
subdivision 1; 299F.21, subdivision 1; 349.212, by
adding a subdivision; 477A.011, by adding a
subdivision; 524.3-1001; 524.3-301; Minnesota Statutes
1989 Supplement, sections 38.18; 50.14, subdivision 4;
69.021, subdivision 6; 110.70; 118.12; 163.04,
subdivision 3; 163.06, subdivision 6; 165.10,
subdivision 1; 168.013, subdivision 5; 168A.10,
subdivision 1; 270.06; 270.73, subdivision 1; 270B.07,
by adding a subdivision; 272.16; 273.01; 273.11,
subdivision 1; 279.01, subdivision 1; 290.39,
subdivision 4; 290.92, subdivision 4c; 290.9201,
subdivisions 7 and 8; 290.9705, subdivision 4;
297A.17; 298.28, subdivision 4; 365.025, subdivision
4; 368.01, subdivision 23; 368.44; 368.47; 370.01;
383.06; 385.31; 386.34; 412.081, subdivision 1;
412.221, subdivision 2; 430.102, subdivision 2;
465.04; 469.177, subdivision 1a; 471.24; 471.73;
475.58, subdivision 2; 475.73, subdivision 1;
477A.011, subdivision 15; 505.173, subdivision 1;
Minnesota Statutes Second 1989 Supplement, sections
10A.31, subdivision 5; 60A.15, subdivision 1; 273.124,
subdivision 6; 273.13, subdivision 25; 273.1391,
subdivision 2; 273.1398, subdivisions 1, 2, 5, 5a, and
6; 274.14; 274.175; 275.07, subdivision 3; 275.50,
subdivision 5; 275.51, subdivisions 3f, 3h, and 6;
276.09; 276.10; 276.11, subdivision 1; 277.01,
subdivision 1; 277.02; 277.05; 277.06; 287.29,
subdivision 1; 290.17, subdivision 2; 290.92,
subdivision 4b; 290A.04, subdivisions 2h and 2i;
297A.01, subdivision 3; 290A.07, subdivision 2a;
349.212, subdivision 4; 373.40, subdivision 1;
473F.08, subdivision 8a; 477A.012, subdivision 3;
477A.013, subdivision 3; Laws 1989, chapter 28,
section 24; and Laws 1989, First Special Session
chapter 1, articles 3, section 35; and 9, section 86;
proposing coding for new law in Minnesota Statutes,
chapter 270; proposing coding for new law as Minnesota
Statutes, chapter 289A; repealing Minnesota Statutes
1988, sections 270.08; 270.10, subdivision 4; 270.651;
272.70; 290.05, subdivision 5; 290.067, subdivision 5;
290.23, subdivision 15; 290.281, subdivision 5;
290.29; 290.37, as amended; 290.39, as amended;
290.391; 290.40; 290.41; 290.42; 290.43; 290.44;
290.45; 290.46; 290.47; 290.49; 290.50, as amended;
290.52; 290.521; 290.522; 290.523, as amended; 290.53,
subdivisions 1, 1a, 2, 2a, 3, 3a, 4, 5, 7, 8, 9, 10,
and 11; 290.54; 290.56; 290.57; 290.58; 290.59;
290.611, subdivision 5; 290.612; 290.65; 290.92,
subdivisions 6, 7, 8, 11, 13, 14, 15, and 18; 290.923,
subdivision 7; 290.93; 290.931; 290.932; 290.933;
290.934, as amended; 290.935; 290.936; 290.974;
290A.06; 290A.11, subdivisions 1, 2, 3, and 4;
290A.111; 290A.112, as amended; 290A.12; 291.09;
291.11; 291.131; 291.14; 291.15, subdivisions 1 and 3;
291.215, subdivisions 2 and 3; 291.31, subdivisions 1
and 2; 291.32; 296.027; 296.16, subdivision 3; 296.17,
subdivision 13; 296.18, subdivisions 3a and 7; 296.24;
297A.08; 297A.121; 297A.15, subdivision 3; 297A.26,
subdivisions 1 and 4; 297A.27; 297A.275; 297A.29;
297A.30; 297A.31; 297A.32; 297A.33, subdivisions 1, 3,
4, and 5; 297A.34; 297A.35; 297A.37; 297A.39,
subdivisions 1, 2, 2a, 3, 4, 5, 7, and 8; 297A.40;
297A.41, 297A.42; 297A.431; 297A.44, subdivision 2;
Minnesota Statutes 1989 Supplement, sections 290.9201,
subdivisions 4, 5, 9, and 10; 290.9705, subdivision 2;
290A.11, subdivision 1a; and 297A.20; Minnesota
Statutes Second 1989 Supplement, sections 270.77 and
290.38; Minnesota Rules, parts 8052.0100; 8052.0200;
and 8130.7800.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
ARTICLE 1
PROCEDURES
Section 1. [289A.01] [APPLICATION OF CHAPTER.]
This chapter applies to taxes administered by or paid to
the commissioner under chapters 290, 290A, 291, and 297A.
Sec. 2. [289A.02] [DEFINITIONS.]
Subdivision 1. [APPLICABILITY.] Unless the context clearly
requires otherwise, the following terms used in this chapter
have the following meanings.
Subd. 2. [COMMISSIONER.] "Commissioner" means the
commissioner of revenue of the state of Minnesota or a person to
whom the commissioner has delegated functions.
Subd. 3. [TAXPAYER.] "Taxpayer" means a person subject to,
or liable for, a state tax; a person required to file a return
with respect to, or to pay, or withhold or collect and remit, a
state tax; or a person required to obtain a license or a permit
or to keep records under a law imposing a state tax.
Subd. 4. [PERSON.] "Person" means an individual,
partnership, corporation, association, governmental unit or
agency, or public or private organization of any kind, under a
duty to comply with state tax laws because of its character or
position.
Subd. 5. [OTHER WORDS.] Unless specifically defined in
this chapter, or unless the context clearly indicates otherwise,
the words used in this chapter have the same meanings as they
are defined in chapters 290, 290A, 291, and 297A.
Sec. 3. [289A.08] [FILING REQUIREMENTS FOR INDIVIDUAL
INCOME, FIDUCIARY INCOME, CORPORATE FRANCHISE, AND ENTERTAINMENT
TAXES.]
Subdivision 1. [GENERALLY; INDIVIDUALS.] (a) A taxpayer
must file a return for each taxable year the taxpayer is
required to file a return under section 6012 of the Internal
Revenue Code of 1986, as amended through December 31, 1989,
except that an individual who is not a Minnesota resident for
any part of the year is not required to file a Minnesota income
tax return if the individual's gross income derived from
Minnesota sources as determined under sections 290.081,
paragraph (a), and 290.17, is less than the filing requirements
for a single individual who is a full year resident of Minnesota.
(b) The decedent's final income tax return, and other
income tax returns for prior years where the decedent had gross
income in excess of the minimum amount at which an individual is
required to file and did not file, must be filed by the
decedent's personal representative, if any. If there is no
personal representative, the return or returns must be filed by
the transferees, as defined in section 289A.38, subdivision 13,
who receive property of the decedent.
(c) The term "gross income," as it is used in this section,
has the same meaning given it in section 290.01, subdivision 20.
Subd. 2. [RETURNS FILED BY FIDUCIARIES.] (a) The trustee
or other fiduciary of property held in trust must file a return
with respect to the taxable net income of the trust or estate if
it exceeds an amount determined by the commissioner and if the
trust belongs to the class of taxable persons.
(b) The receivers, trustees in bankruptcy, or assignees
operating the business or property of a taxpayer must file a
return with respect to the taxable net income of the taxpayer if
a return is required.
Subd. 3. [CORPORATIONS.] A corporation that is subject to
the state's jurisdiction to tax under section 290.014,
subdivision 5, must file a return, except that a foreign
operating corporation as defined in section 290.01, subdivision
6b, is not required to file a return. The return must be signed
by a person designated by the corporation. The commissioner
shall adopt rules for the filing of one return on behalf of the
members of an affiliated group of corporations that are required
to file a combined report. Members of an affiliated group that
elect to file one return on behalf of the members of the group
under rules adopted by the commissioner may change or rescind
the election by filing the form required by the commissioner.
Subd. 4. [EXEMPT ORGANIZATIONS; UNRELATED BUSINESS
INCOME.] An exempt organization that is subject to tax on
unrelated business income under section 290.05, subdivision 3,
must file a return for each taxable year in which the
organization is required to file a return under section 6012 of
the Internal Revenue Code of 1986, as amended through December
31, 1989, because of the receipt of unrelated business income.
If an organization is required to file a return under federal
law but has no federal tax liability for the taxable year, the
commissioner may provide that the filing requirement under this
paragraph is satisfied by filing a copy of the taxpayer's
federal return.
Subd. 5. [ANNUAL RETURN; EXCEPTIONS.] A return under this
section must cover a 12-month period, except in the following
cases:
(1) A return made by or for a taxpayer in existence for
less than the whole of a taxable year must cover the part of the
taxable year the taxpayer was in existence;
(2) A taxpayer who, in keeping books, regularly computes
income on the basis of an annual period that varies from 52 to
53 weeks and ends always on the same day of the week, and ends
always (i) on the date that day of the week last occurs in a
calendar month or (ii) on the date that day of the week falls
that is nearest to the last day of a calendar month, may compute
the taxpayer's net income and taxable net income on the basis of
that annual period in accordance with rules prescribed by the
commissioner. If the effective date or the applicability of a
provision of this chapter or chapter 290 is expressed in terms
of taxable years beginning or ending with reference to a named
date that is the first or last day of a month, a taxable year
must be treated as beginning with the first day of the calendar
month beginning nearest to the first day of that taxable year,
or as ending with the last day of the calendar month ending
nearest to the last day of that taxable year, as the case may
be;
(3) A taxpayer who changes from one taxable year to another
must make a return for the fractional parts of the year, under
section 290.32.
Subd. 6. [RETURNS OF MARRIED PERSONS.] A husband and wife
must file a joint Minnesota income tax return if they filed a
joint federal income tax return. If the husband and wife have
elected to file separate federal income tax returns, they must
file separate Minnesota income tax returns. This election to
file a joint or separate return must be changed if they change
their election for federal purposes. In the event taxpayers
desire to change their election, the change must be done in the
manner and on the form prescribed by the commissioner.
The determination of whether an individual is married shall
be made under the provisions of section 7703 of the Internal
Revenue Code of 1986, as amended through December 31, 1989.
Subd. 7. [COMPOSITE INCOME TAX RETURNS FOR NONRESIDENT
PARTNERS, SHAREHOLDERS, AND BENEFICIARIES.] (a) The commissioner
may allow a partnership with five or more nonresident partners
to file a composite return and to pay the tax on behalf of
nonresident partners who have no other Minnesota source income.
This composite return must include the names, addresses, social
security numbers, income allocation, and tax liability for the
nonresident partners electing to be covered by the composite
return.
(b) The computation of a partner's tax liability must be
determined by multiplying the income allocated to that partner
by the highest rate used to determine the tax liability for
individuals under section 290.06, subdivision 2c. Nonbusiness
deductions, standard deductions, or personal exemptions are not
allowed.
(c) The partnership must submit a request to use this
composite return filing method for nonresident partners on or
before the due date for filing the individual income tax
returns. The request may be made a part of the return filed.
(d) The electing partner must not have any Minnesota source
income other than the income from the partnership and other
electing partnerships. If it is determined that the electing
partner has other Minnesota source income, the inclusion of the
income and tax liability for that partner under this provision
will not constitute a return to satisfy the requirements of
subdivision 1. The tax paid for the individual as part of the
composite return is allowed as a payment of the tax by the
individual on the date on which the composite return payment was
made. If the electing nonresident partner has no other
Minnesota source income, filing of the composite return is a
return for purposes of subdivision 1.
(e) This subdivision does not negate the requirement that
an individual pay estimated tax if the individual's liability
would exceed the requirements set forth in section 289A.25. A
composite estimate may, however, be filed in a manner similar to
and containing the information required under paragraph (a).
(f) If an electing partner's share of the partnership's
gross income from Minnesota sources is less than the filing
requirements for a nonresident under this subdivision, the tax
liability is zero. However, a statement showing the partner's
share of gross income must be included as part of the composite
return.
(g) The election provided in this subdivision is not
available to any partner other than a full-year nonresident
individual who has no other Minnesota source income.
(h) A corporation defined in section 290.9725 and its
nonresident shareholders may make an election under this
paragraph. The provisions covering the partnership apply to the
corporation and the provisions applying to the partner apply to
the shareholder.
(i) Estates and trusts distributing current income only and
the nonresident individual beneficiaries of the estates or
trusts may make an election under this paragraph. The
provisions covering the partnership apply to the estate or
trust. The provisions applying to the partner apply to the
beneficiary.
Subd. 8. [RETURNS OF ENTERTAINMENT ENTITIES.] An
entertainment entity subject to the tax imposed by section
290.9201 shall file an annual return for the calendar year with
the commissioner.
Subd. 9. [VERIFICATION.] If a return is prepared for a
taxpayer by an individual (or individuals) or a firm (including
partnerships, corporations, etc.), the individual or firm
responsible for the preparation must complete the statement of
verification provided on the tax return forms in the following
manner:
(1) If the individual (or individuals) responsible for the
preparation of the return is an individual acting in a personal
capacity, the statement of verification must be signed by the
individual.
(2) If a firm is responsible for the preparation of the
return, the statement of verification must be signed with the
firm name. However, if the firm name is stamped or typed, it
should be followed by the signature of an individual authorized
to sign the verification on behalf of the firm. The firm may
authorize an officer, member, or employee to sign the
verification.
Verification is not required if the actual preparation of
the return is a regular and usual incident of the employment of
one regularly and continuously employed full time by the person
for whom the return is made (such as a clerk, secretary,
bookkeeper, etc.).
Subd. 10. [FILING OF PROPER RETURN.] The return must
specifically set forth the items of gross income, deductions,
credits against the tax, and any other data necessary for
computing the amount of any item required for determining the
amount of the net income tax liability. The return must be in
the form the commissioner prescribes. The filing of a return
required under this section is considered an assessment.
Subd. 11. [INFORMATION INCLUDED IN INCOME TAX RETURN.] The
return must state the name of the taxpayer, or taxpayers, if the
return is a joint return, and the address of the taxpayer in the
same name or names and same address as the taxpayer has used in
making the taxpayer's income tax return to the United States,
and must state the social security number of the taxpayer, or
taxpayers, if a social security number has been issued by the
United States with respect to the taxpayers, and must state the
amount of the taxable income of the taxpayer as it appears on
the federal return for the taxable year to which the Minnesota
state return applies. The taxpayer must attach to the
taxpayer's Minnesota state income tax return a copy of the
federal income tax return that the taxpayer has filed or is
about to file for the period.
Subd. 12. [CONFESSION OF JUDGMENT.] The return must
contain (1) a written declaration that it is correct and
complete, and (2) language prescribed by the commissioner
providing a confession of judgment for the amount of the tax
shown due to the extent not timely paid.
Subd. 13. [LONG AND SHORT FORMS.] The commissioner shall
provide a long form individual income tax return and may provide
a short form individual income tax return. The returns shall be
in a form that is consistent with the provisions of chapter 290,
notwithstanding any other law to the contrary. The nongame
wildlife checkoff provided in section 290.431 and the dependent
care credit provided in section 290.067 must be included on the
short form.
Subd. 14. [VOTER REGISTRATION FORM.] The commissioner
shall insert securely in the individual income tax return form
or instruction booklet a voter registration form, returnable to
the secretary of state. The form shall be designed according to
rules adopted by the secretary of state.
Sec. 4. [289A.09] [FILING REQUIREMENTS FOR TAXES WITHHELD
FROM WAGES FROM COMPENSATION OF ENTERTAINERS AND FROM PAYMENTS
TO OUT-OF-STATE CONTRACTORS; AND TAXES WITHHELD BY PARTNERSHIPS
AND SMALL BUSINESS CORPORATIONS.]
Subdivision 1. [RETURNS.] (a) An employer who is required
to deduct and withhold tax under section 290.92, subdivision 2a
or 3, and a person required to deduct and withhold tax under
section 290.923, subdivision 2, must file a return with the
commissioner for each quarterly period unless otherwise
prescribed by the commissioner.
(b) A person or corporation required to make deposits under
section 290.9201, subdivision 8, must file an entertainer
withholding tax return with the commissioner.
(c) A person required to withhold an amount under section
290.9705, subdivision 1, must file a return.
(d) A partnership required to deduct and withhold tax under
section 290.92, subdivision 4b, must file a return.
(e) An S corporation required to deduct and withhold tax
under section 290.92, subdivision 4c, must also file a return.
(f) Returns must be filed in the form and contain the
information prescribed by the commissioner. Every return must
contain a written declaration that it is correct and complete,
and a confession of judgment for the amount of tax shown due, to
the extent not timely paid.
Subd. 2. [WITHHOLDING STATEMENT TO EMPLOYEE OR PAYEE AND
TO COMMISSIONER.] (a) A person required to deduct and withhold
from an employee a tax under section 290.92, subdivision 2a or
3, or section 290.923, subdivision 2, or who would have been
required to deduct and withhold a tax under section 290.92,
subdivision 2a or 3, or persons required to withhold tax under
section 290.923, subdivision 2, determined without regard to
section 290.92, subdivision 19, if the employee or payee had
claimed no more than one withholding exemption, or who paid
wages or made payments not subject to withholding under section
290.92, subdivision 2a or 3, or section 290.923, subdivision 2,
to an employee or person receiving royalty payments in excess of
$600, or who has entered into a voluntary withholding agreement
with a payee under section 290.92, subdivision 20, must give
every employee or person receiving royalty payments in respect
to the remuneration paid by the person to the employee or person
receiving royalty payments during the calendar year, on or
before January 31 of the succeeding year, or, if employment is
terminated before the close of the calendar year, within 30 days
after the date of receipt of a written request from the employee
if the 30-day period ends before January 31, a written statement
showing the following:
(1) name of the person;
(2) the name of the employee or payee and the employee's or
payee's social security account number;
(3) the total amount of wages as that term is defined in
section 290.92, subdivision 1(1); the total amount of
remuneration subject to withholding under section 290.92,
subdivision 20; the amount of sick pay as required under section
6051(f) of the Internal Revenue Code of 1986, as amended through
December 31, 1989; and the amount of royalties subject to
withholding under section 290.923, subdivision 2; and
(4) the total amount deducted and withheld as tax under
section 290.92, subdivision 2a or 3, or 290.923, subdivision 2.
(b) The statement required to be furnished by this
paragraph with respect to any remuneration must be furnished at
those times, must contain the information required, and must be
in the form the commissioner prescribes.
(c) The commissioner may prescribe rules providing for
reasonable extensions of time, not in excess of 30 days, to
employers or payers required to give the statements to their
employees or payees under this subdivision.
(d) A duplicate of any statement made under this
subdivision and in accordance with rules prescribed by the
commissioner, along with a reconciliation in the form the
commissioner prescribes of the statements for the calendar year,
including a reconciliation of the quarterly returns required to
be filed under subdivision 1, must be filed with the
commissioner on or before February 28 of the year after the
payments were made.
(e) The employer must submit the statements required to be
sent to the commissioner on magnetic media, if the magnetic
media was required to satisfy the federal reporting requirements
of section 6011(e) of the Internal Revenue Code of 1986, as
amended through December 31, 1989, and the regulations issued
under it.
Sec. 5. [289A.10] [FILING REQUIREMENTS FOR ESTATE TAX
RETURNS.]
Subdivision 1. [RETURN REQUIRED.] In the case of a
decedent who has an interest in property with a situs in
Minnesota, the personal representative must submit a Minnesota
estate tax return to the commissioner, on a form prescribed by
the commissioner, in instances in which a federal estate tax
return is required to be filed.
The return must be accompanied by a federal estate tax
return, a schedule of the assets in the estate at their date of
death values, and must contain a computation of the Minnesota
estate tax due. The return must be signed by the personal
representative.
Subd. 2. [DOCUMENTS REQUIRED.] The commissioner may
designate on the return the documents that are required to be
filed together with the return to determine the computation of
tax.
Subd. 3. [DEFINITIONS.] For purposes of this section, the
definitions contained in section 291.005 apply.
Sec. 6. [289A.11] [FILING REQUIREMENTS FOR SALES AND USE
TAX RETURNS.]
Subdivision 1. [RETURN REQUIRED.] Except as provided in
section 289A.18, subdivision 4, for the month in which taxes
imposed by sections 297A.01 to 297A.44 are payable, or for which
a return is due, a return for the preceding reporting period
must be filed with the commissioner in the form the commissioner
prescribes. The return must be verified by a written
declaration that it is made under the criminal penalties for
making a false return, and in addition must contain a confession
of judgment for the amount of the tax shown due to the extent
not timely paid. A person making sales at retail at two or more
places of business may file a consolidated return subject to
rules prescribed by the commissioner.
Subd. 2. [LIQUOR SALES.] A person required to collect the
tax imposed by section 297A.02, subdivision 3, on sales of
intoxicating liquor and nonintoxicating malt liquor, shall
report the total sales tax liability, including the sales tax on
items other than intoxicating liquor and nonintoxicating malt
liquor, on a distinct sales tax return prescribed by the
commissioner.
Subd. 3. [WHO MUST FILE RETURN.] For purposes of the sales
tax, a return must be filed by a retailer who is required to
hold a permit. For the purposes of the use tax, a return must
be filed by a retailer required to collect the tax and by a
person buying any items, the storage, use or other consumption
of which is subject to the use tax, who has not paid the use tax
to a retailer required to collect the tax. The returns must be
signed by the person filing the return or by the person's agent
duly authorized in writing.
Sec. 7. [289A.12] [FILING REQUIREMENTS FOR INFORMATION
RETURNS AND REPORTS.]
Subdivision 1. [REPORTS BY EXEMPT CORPORATIONS,
ORGANIZATIONS, ESTATES, AND TRUSTS.] Corporations, estates,
trusts, and organizations exempt from state income and franchise
taxes under section 290.05, subdivision 2, must file with the
commissioner of revenue an initial report that furnishes the
information required under section 290.05, subdivision 4,
paragraph (a), and later annual reports as required by section
290.05, subdivision 4.
Subd. 2. [RETURNS REQUIRED OF BANKS; COMMON TRUST
FUNDS.] A bank maintaining a common trust fund must make a
return for a taxable year, stating specifically with respect to
the fund, the items of gross income and deductions provided by
section 290.281, subdivision 1. The return must include the
names and addresses of the participants entitled to share the
net income if distributed and the amount of the proportionate
share of each participant.
Subd. 3. [RETURNS OR REPORTS BY PARTNERSHIPS, FIDUCIARIES,
AND S CORPORATIONS.] (a) Partnerships must make a return for
each taxable year. The return must conform to the requirements
of section 290.31, and must include the names and addresses of
the partners entitled to a distributive share in their taxable
net income, gain, loss, or credit, and the amount of the
distributive share to which each is entitled. The return must
contain a written declaration that it is correct and complete.
A partnership required to file a return for a partnership
taxable year must furnish a copy of the information required to
be shown on the return to a person who is a partner at any time
during the taxable year, on or before the day on which the
return for the taxable year was filed.
(b) The fiduciary of an estate or trust making the return
required to be filed under section 289A.08, subdivision 2, for a
taxable year must give a beneficiary who receives a distribution
from the estate or trust with respect to the taxable year or to
whom any item with respect to the taxable year is allocated, a
statement containing the information required to be shown on the
return, on or before the date on which the return was filed.
(c) An S corporation must make a return for a taxable year
during which an election under section 290.9725 is in effect,
stating specifically the names and addresses of the persons
owning stock in the corporation at any time during the taxable
year, the number of shares of stock owned by a shareholder at
all times during the taxable year, the shareholder's pro rata
share of each item of the corporation for the taxable year, and
other information the commissioner requires. An S corporation
required to file a return under this paragraph for any taxable
year must furnish a copy of the information shown on the return
to the person who is a shareholder at any time during the
taxable year, on or before the day on which the return for the
taxable year was filed.
Subd. 4. [RETURNS BY PERSONS, CORPORATIONS, COOPERATIVES,
GOVERNMENTAL ENTITIES, OR SCHOOL DISTRICTS.] To the extent
required by section 6041 of the Internal Revenue Code of 1986,
as amended through December 31, 1989, a person, corporation, or
cooperative, the state of Minnesota and its political
subdivisions, and a city, county, and school district in
Minnesota, making payments in the regular course of a trade or
business during the taxable year to any person or corporation of
$600 or more on account of rents or royalties, or of $10 or more
on account of interest, or $10 or more on account of dividends
or patronage dividends, or $600 or more on account of either
wages, salaries, commissions, fees, prizes, awards, pensions,
annuities, or any other fixed or determinable gains, profits or
income, not otherwise reportable under section 289A.09,
subdivision 2, or on account of earnings of $10 or more
distributed to its members by savings, building and loan
associations or credit unions chartered under the laws of this
state or the United States, (1) must make a return (except in
cases where a valid agreement to participate in the combined
federal and state information reporting system has been entered
into, and the return is filed only with the commissioner of
internal revenue under the applicable filing and informational
reporting requirements of the Internal Revenue Code of 1986, as
amended through December 31, 1989) with respect to the payments
in excess of the amounts named, giving the names and addresses
of the persons to whom the payments were made, the amounts paid
to each, and (2) must make a return with respect to the total
number of payments and total amount of payments, for each
category of income named, which were in excess of the amounts
named. This subdivision does not apply to the payment of
interest or dividends to a person who was a nonresident of
Minnesota for the entire year.
A person, corporation, or cooperative required to file
returns under this subdivision must file the returns on magnetic
media if magnetic media was used to satisfy the federal
reporting requirement under section 6011(e) of the Internal
Revenue Code of 1986, as amended through December 31, 1989,
unless the person establishes to the satisfaction of the
commissioner that compliance with this requirement would be an
undue hardship.
Subd. 5. [RETURNS BY BROKERS.] The commissioner may,
within 30 days after notice and demand, require a person doing
business as a broker to give the commissioner the names and
addresses of customers for whom they have transacted business,
and the details regarding gross proceeds and other information
concerning the transactions as will enable the commissioner to
determine whether the income tax due on profits or gains of
those customers has been paid. The provisions of section 6045
of the Internal Revenue Code of 1986, as amended through
December 31, 1989, which define terms and require that a
statement be furnished to the customer apply.
Subd. 6. [RETURNS BY AGENTS.] The commissioner may, within
30 days after notice and demand, require a person acting as
agent for another to make a return furnishing the information
reasonably necessary to properly assess and collect the tax
imposed by chapter 290 upon the person for whom the agent acts.
Subd. 7. [RETURNS FOR REAL PROPERTY HOLDINGS OF ALIENS.] A
person or corporation required to make a return under section
6039C (relating to information return on a foreign person
holding a United States real property interest) of the Internal
Revenue Code of 1986, as amended through December 31, 1989, must
make a similar return for the commissioner for foreign persons
holding a Minnesota real property interest.
Subd. 8. [RETURNS FOR UNEMPLOYMENT COMPENSATION.] A person
who makes payments of unemployment compensation totaling $10 or
more to any individual during a calendar year and who is
required to make and file a return under section 6050B of the
Internal Revenue Code of 1986, as amended through December 31,
1989, must file a copy of the return with the commissioner.
Subd. 9. [RETURNS FOR PAYMENTS OF REMUNERATION FOR
SERVICES AND DIRECT SALES.] A person who is required to make a
return under section 6041A (relating to information returns
regarding payments of remuneration for services and direct
sales) of the Internal Revenue Code of 1986, as amended through
December 31, 1989, must file a copy of the return containing the
information required under that section with the commissioner.
The provisions of that section govern the requirements of a
statement that must be given to persons with respect to whom
information is required to be given.
Subd. 10. [RETURNS RELATING TO SOCIAL SECURITY
BENEFITS.] The appropriate federal official who is required to
make a return under section 6050F (relating to social security
benefits) of the Internal Revenue Code of 1986, as amended
through December 31, 1989, shall file a copy of the return
containing the information required under that section with the
commissioner.
Subd. 11. [RETURNS BY TRUSTEES.] The trustee of an
individual retirement account and the issuer of an endowment
contract or an individual retirement annuity who is required to
make a report under section 408(i) of the Internal Revenue Code
of 1986, as amended through December 31, 1989, must file with
the commissioner a copy of that report containing the
information required under that subsection. The provisions of
that subsection govern when the reports are to be filed and the
requirements of a statement that must be given to persons with
respect to whom information must be given.
Subd. 12. [STATEMENTS TO PAYEES.] A person making a return
under subdivisions 4 to 10 must furnish to a person whose name
is set forth in the return a written statement showing the name
and address of the person making the return, and the aggregate
amount of payments to the person shown on the return.
This written statement must be given to the person on or
before January 31 of the year following the calendar year for
which the return was made. A duplicate of this written
statement, along with a reconciliation of all the statements for
the calendar year in the form the commissioner prescribes, must
be furnished to the commissioner on or before February 28 of the
year following the calendar year for which the return was made.
Subd. 13. [SUPPLYING OF SOCIAL SECURITY NUMBER.] An
individual with respect to whom a return, statement, or other
document is required under this section to be made by another
person must furnish to that person the individual's social
security account number. A person required under this section
to make a return, statement, or other document with respect to
another person who is an individual must request from that
individual and must include in the return, statement, or other
document the individual's social security account number. A
return of an estate or trust with respect to its liability for
tax, and any statement or other document in its support, is
considered a return, statement, or other document with respect
to the individual beneficiary of the estate or trust; otherwise,
a return of an individual with respect to the individual's
liability for tax, or any statement or other document in its
support, is not considered a return, statement, or other
document with respect to another person.
Sec. 8. [289A.18] [DUE DATES FOR FILING OF RETURNS.]
Subdivision 1. [INDIVIDUAL INCOME, FIDUCIARY INCOME,
CORPORATE FRANCHISE, AND ENTERTAINMENT TAXES; PARTNERSHIP AND S
CORPORATION RETURNS; INFORMATION RETURNS.] The returns required
to be made under sections 289A.08 and 289A.12 must be filed at
the following times:
(1) returns made on the basis of the calendar year must be
filed on April 15 following the close of the calendar year,
except that returns of corporations must be filed on March 15
following the close of the calendar year;
(2) returns made on the basis of the fiscal year must be
filed on the 15th day of the fourth month following the close of
the fiscal year, except that returns of corporations must be
filed on the 15th day of the third month following the close of
the fiscal year;
(3) returns for a fractional part of a year must be filed
on the 15th day of the fourth month following the end of the
month in which falls the last day of the period for which the
return is made, except that the returns of corporations must be
filed on the 15th day of the third month following the end of
the month in which falls the last day of the period for which
the return is made;
(4) in the case of a final return of a decedent for a
fractional part of a year, the return must be filed on the 15th
day of the fourth month following the close of the 12-month
period that began with the first day of that fractional part of
a year;
(5) in the case of the return of a cooperative association,
returns must be filed on or before the 15th day of the ninth
month following the close of the taxable year;
(6) if a corporation has been divested from a unitary group
and files a return for a fractional part of a year in which it
was a member of a unitary business that files a combined report
under section 290.34, subdivision 2, the divested corporation's
return must be filed on the 15th day of the third month
following the close of the common accounting period that
includes the fractional year; and
(7) returns of entertainment entities must be filed on
April 15 following the close of the calendar year.
Subd. 2. [WITHHOLDING RETURNS, ENTERTAINER WITHHOLDING
RETURNS, RETURNS FOR WITHHOLDING FROM PAYMENTS TO OUT-OF-STATE
CONTRACTORS, AND WITHHOLDING RETURNS FROM PARTNERSHIPS AND SMALL
BUSINESS CORPORATIONS.] Withholding returns are due on or before
the last day of the month following the close of the quarterly
period. However, if the return shows timely deposits in full
payment of the taxes due for that period, the return may be
filed on or before the tenth day of the second calendar month
following the period. An employer, in preparing a quarterly
return, may take credit for monthly deposits previously made for
that quarter. Entertainer withholding tax returns are due
within 30 days after each performance. Returns for withholding
from payments to out-of-state contractors are due within 30 days
after the payment to the contractor. Returns for withholding by
partnerships are due on or before the due date specified for
filing partnership returns. Returns for withholding by small
business corporations are due on or before the due date
specified for filing corporate franchise tax returns.
Subd. 3. [ESTATE TAX RETURNS.] An estate tax return must
be filed with the commissioner within nine months after the
decedent's death.
Subd. 4. [SALES AND USE TAX RETURNS.] Sales and use tax
returns must be filed on or before the 20th day of the month
following the close of the preceding reporting period. In
addition, on or before June 20 of a year, a retailer who has a
May liability of $1,500 or more must file a return with the
commissioner for one-half of the estimated June liability, in
addition to filing a return for the May liability. On or before
August 20 of a year, the retailer must file a return showing the
actual June liability.
Subd. 5. [PROPERTY TAX REFUND CLAIMS.] A claim for a
refund based on property taxes payable must be filed with the
commissioner on or before August 15 of the year in which the
property taxes are due and payable. Any claim for refund based
on rent paid must be filed on or before August 15 of the year
following the year in which the rent was paid.
Sec. 9. [289A.19] [EXTENSIONS FOR FILING RETURNS.]
Subdivision 1. [INDIVIDUAL INCOME, FIDUCIARY INCOME,
ENTERTAINMENT TAX, AND INFORMATION RETURNS.] When, in the
commissioner's judgment, good cause exists, the commissioner may
extend the time for filing individual and fiduciary income tax
returns, entertainment tax returns, and information returns for
not more than six months. If an extension to file the federal
individual or fiduciary income tax return or information return
has been granted under section 6081 of the Internal Revenue Code
of 1986, as amended through December 31, 1989, the time for
filing the state return is extended for that period. The
commissioner may require the taxpayer to file a tentative return
when the regularly required return is due, and to pay a tax on
the basis of the tentative return at the times required for the
payment of taxes on the basis of the regularly required return
from the taxpayer.
Subd. 2. [CORPORATE FRANCHISE TAXES.] The commissioner may
grant an extension of up to seven months for filing the return
of a corporation subject to tax under chapter 290 if:
(1) the corporation files a tentative return when the
regularly required return is due;
(2) the corporation pays the tax on the basis of the
tentative return and the amount of tax, determined without
regard to any prepayment of tax, shown on the tentative return,
or the amount of tax paid on or before the regular due date of
the return, is at least 90 percent of the amount shown on the
corporation's regularly required return;
(3) the balance due shown on the regularly required return
is paid on or before the extended due date of the return; and
(4) interest on any balance due is paid at the rate
specified in section 270.75 from the regular due date of the
return until the tax is paid.
Subd. 3. [WITHHOLDING RETURNS.] Where good cause exists,
the commissioner may grant an extension of time of not more than
60 days for filing a withholding return.
Subd. 4. [ESTATE TAX RETURNS.] Where good cause exists,
the commissioner may extend the time for filing an estate tax
return for not more than six months. When an extension to file
the federal estate tax return has been granted under section
6081 of the Internal Revenue Code of 1986, as amended through
December 31, 1989, the time for filing the estate tax return is
extended for that period.
Subd. 5. [SALES AND USE TAX RETURNS.] Where good cause
exists, the commissioner may extend the time for filing sales
and use tax returns for not more than 60 days.
Subd. 6. [PROPERTY TAX REFUND RETURNS.] Where good cause
exists, the commissioner may extend the time for filing claims
under chapter 290A for not more than six months. A claim filed
after the original or extended due date shall be allowed if the
initial claim is filed within one year after the original due
date for filing the claim, subject to the provisions of section
289A.60, subdivision 12, paragraph (e).
Sec. 10. [289A.20] [DUE DATES FOR MAKING PAYMENTS OF TAX.]
Subdivision 1. [INDIVIDUAL INCOME, FIDUCIARY INCOME,
CORPORATE FRANCHISE, AND ENTERTAINMENT TAXES.] (a) Individual
income, fiduciary, and corporate franchise taxes must be paid to
the commissioner on or before the date the return must be filed
under section 289A.18, subdivision 1, or the extended due date
as provided in section 289A.19, unless an earlier date for
payment is provided.
Notwithstanding any other law, a taxpayer whose unpaid
liability for income or corporate franchise taxes, as reflected
upon the return, is $1 or less need not pay the tax.
(b) Entertainment taxes must be paid on or before the date
the return must be filed under section 289A.18, subdivision 1.
Subd. 2. [WITHHOLDING FROM WAGES, ENTERTAINER WITHHOLDING,
WITHHOLDING FROM PAYMENTS TO OUT-OF-STATE CONTRACTORS, AND
WITHHOLDING BY PARTNERSHIPS AND SMALL BUSINESS
CORPORATIONS.] (a) A tax required to be deducted and withheld
during the quarterly period must be paid on or before the last
day of the month following the close of the quarterly period,
unless an earlier time for payment is provided. A tax required
to be deducted and withheld from compensation of an entertainer
and from a payment to an out-of-state contractor must be paid on
or before the date the return for such tax must be filed under
section 289A.18, subdivision 2. Taxes required to be deducted
and withheld by partnerships and S corporations must be paid on
or before the date the return must be filed under section
289A.18, subdivision 2.
(b)(1) Unless clause (2) applies, if during any calendar
month, other than the last month of the calendar quarter, the
aggregate amount of the tax withheld during that quarter under
section 290.92, subdivision 2a or 3, or under section 290.923,
subdivision 2, exceeds $500, the employer shall deposit the
aggregate amount with the commissioner within 15 days after the
close of the calendar month. (2) If at the close of any
eighth-monthly period the aggregate amount of undeposited taxes
is $3,000 or more, the employer, or person withholding tax under
section 290.92, subdivision 2a or 3, or section 290.923,
subdivision 2, shall deposit the undeposited taxes with the
commissioner within three banking days after the close of the
eighth-monthly period. For purposes of this clause, the term
"eighth-monthly period" means the first three days of a calendar
month, the fourth day through the seventh day of a calendar
month, the eighth day through the 11th day of a calendar month,
the 12th day through the 15th day of a calendar month, the 16th
day through the 19th day of a calendar month, the 20th day
through the 22nd day of a calendar month, the 23rd day through
the 25th day of a calendar month, or the part of a calendar
month following the 25th day of the month.
(c) The commissioner may prescribe by rule other return
periods or deposit requirements. In prescribing the reporting
period, the commissioner may classify payors according to the
amount of their tax liability and may adopt an appropriate
reporting period for the class that the commissioner judges to
be consistent with efficient tax collection. In no event will
the duration of the reporting period be more than one year.
(d) If less than the correct amount of tax is paid to the
commissioner, proper adjustments with respect to both the tax
and the amount to be deducted must be made, without interest, in
the manner and at the times the commissioner prescribes. If the
underpayment cannot be adjusted, the amount of the underpayment
will be assessed and collected in the manner and at the times
the commissioner prescribes.
Subd. 3. [ESTATE TAX.] Taxes imposed by chapter 291 take
effect at and upon the death of the person whose estate is
subject to taxation and are due and payable on or before the
expiration of nine months from that death.
Subd. 4. [SALES AND USE TAX.] (a) The taxes imposed by
chapter 297A are due and payable to the commissioner monthly on
or before the 20th day of the month following the month in which
the taxable event occurred or following another reporting period
as the commissioner prescribes.
(b) A vendor having a liability of $1,500 or more in May of
a year must remit the June liability in the following manner:
(1) On or before June 20 of the year, the vendor must remit
the actual May liability and one-half of the estimated June
liability to the commissioner.
(2) On or before August 20 of the year, the vendor must pay
any additional amount of tax not remitted in June.
(c) When a retailer located outside of a city that imposes
a local sales and use tax collects use tax to be remitted to
that city, the retailer is not required to remit the tax until
the amount collected reaches $10.
Sec. 11. [289A.25] [PAYMENT OF ESTIMATED TAX BY
INDIVIDUALS.]
Subdivision 1. [REQUIREMENTS TO PAY.] An individual must,
when prescribed in subdivision 3, paragraph (b), make payments
of estimated tax. The term "estimated tax" means the amount the
individual estimates is the sum of the taxes imposed by chapter
290 for the taxable year. If the individual is an infant or
incompetent person, the payments must be made by the
individual's guardian. If joint payments on estimated tax are
made but a joint return is not made for the taxable year, the
estimated tax for that year may be treated as the estimated tax
of either the husband or the wife or may be divided between them.
Notwithstanding the provisions of this section, no payments
of estimated tax are required if the estimated tax, as defined
in this subdivision, less the credits allowed against the tax,
is less than $500.
Subd. 2. [ADDITIONS TO TAX FOR UNDERPAYMENT.] (a) In the
case of any underpayment of estimated tax by an individual,
except as provided in subdivision 6 or 7, there must be added to
and become a part of the taxes imposed by chapter 290, for the
taxable year an amount determined at the rate specified in
section 270.75 upon the amount of the underpayment for the
period of the underpayment.
(b) For purposes of paragraph (a), the amount of
underpayment shall be the excess of
(1) the amount of the installment required to be paid, over
(2) the amount, if any, of the installment paid on or
before the last day prescribed for the payment.
Subd. 3. [PERIOD OF UNDERPAYMENT.] (a) The period of the
underpayment shall run from the date the installment was
required to be paid to the earlier of the following dates:
(1) The 15th day of the fourth month following the close of
the taxable year.
(2) With respect to any part of the underpayment, the date
on which that part is paid. For purposes of this clause, a
payment of estimated tax on any installment date is considered a
payment of any unpaid required installments in the order in
which the installments are required to be paid.
(b) For purposes of this subdivision, there shall be four
required installments for a taxable year. The times for payment
of installments shall be:
For the following
required installments: The due date is:
1st April 15
2nd June 15
3rd September 15
4th January 15 of the following
taxable year
Subd. 4. [NO ADDITION TO TAX WHERE TAX IS SMALL.] No
addition to tax is imposed under subdivision 2 for a taxable
year if the tax shown on the return for the taxable year (or, if
no return is filed, the tax) reduced by the credits allowable is
less than $500.
Subd. 5. [AMOUNT OF REQUIRED INSTALLMENT.] The amount of
any installment required to be paid shall be 25 percent of the
required annual payment except as provided in clause (3). The
term "required annual payment" means the lesser of
(1) 90 percent of the tax shown on the return for the
taxable year or 90 percent of the tax for the year if no return
is filed, or
(2) the total tax liability shown on the return of the
individual for the preceding taxable year, if a return showing a
liability for the taxes was filed by the individual for the
preceding taxable year of 12 months, or
(3) an amount equal to the applicable percentage of the tax
for the taxable year computed by placing on an annualized basis
the taxable income and alternative minimum taxable income for
the months in the taxable year ending before the month in which
the installment is required to be paid. The applicable
percentage of the tax is 22.5 percent in the case of the first
installment, 45 percent for the second installment, 67.5 percent
for the third installment, and 90 percent for the fourth
installment. For purposes of this clause, the taxable income
and alternative minimum taxable income shall be placed on an
annualized basis by
(i) multiplying by 12 (or in the case of a taxable year of
less than 12 months, the number of months in the taxable year)
the taxable income and alternative minimum taxable income
computed for the months in the taxable year ending before the
month in which the installment is required to be paid; and
(ii) dividing the resulting amount by the number of months
in the taxable year ending before the month in which the
installment date falls.
Subd. 6. [EXCEPTION TO ADDITION TO TAX.] No addition to
the tax shall be imposed under this section for any taxable year
if:
(1) the individual did not have liability for tax for the
preceding taxable year,
(2) the preceding taxable year was a taxable year of 12
months, and
(3) the individual was a resident of Minnesota throughout
the preceding taxable year.
Subd. 7. [WAIVER OF ADDITION TO TAX.] No addition to the
tax is imposed under this section with respect to an
underpayment to the extent the commissioner determines that the
provisions of section 6654(e)(3) of the Internal Revenue Code of
1986, as amended through December 31, 1989, apply.
Subd. 8. [APPLICATION OF SECTION; TAX WITHHELD ON
WAGES.] For purposes of this section, the estimated tax must be
computed without reduction for the amount that the individual
estimates as the individual's credit under section 290.92,
subdivision 12 (relating to tax withheld at source on wages),
and any other refundable credits allowed against income tax
liability, and the amount of those credits for the taxable year
is considered a payment of estimated tax, and an equal part of
those amounts is considered paid on the installment date,
determined under subdivision 3, paragraph (b), for that taxable
year, unless the taxpayer establishes the dates on which the
amounts were actually withheld, in which case the amounts so
withheld are considered payments of estimated tax on the dates
on which the amounts were actually withheld.
Subd. 9. [SPECIAL RULE FOR RETURN FILED ON OR BEFORE
JANUARY 31.] If, on or before January 31 of the following
taxable year, the taxpayer files a return for the taxable year
and pays in full the amount computed on the return as payable,
then no addition to tax is imposed under subdivision 2 with
respect to any underpayment of the fourth required installment
for the taxable year.
Subd. 10. [SPECIAL RULE FOR FARMERS AND FISHERMEN.] For
purposes of this section, if an individual is a farmer or
fisherman as defined in section 6654(f)(2) of the Internal
Revenue Code of 1986, as amended through December 31, 1989, for
a taxable year, only one installment is required for the taxable
year, the due date of which is January 15 of the following
taxable year, the amount of which is equal to the required
annual payment determined under subdivision 5 by substituting
"66-2/3 percent" for "90 percent," and subdivision 9 shall be
applied by substituting "March 1" for "January 31," and by
treating the required installment described as the fourth
required installment.
Subd. 11. [FISCAL YEAR TAXPAYER.] The application of this
section to taxable years beginning other than January 1 must be
made by substituting, for the months named in this section, the
months that correspond. This section must be applied to taxable
years of less than 12 months, under rules issued by the
commissioner.
Subd. 12. [TRUSTS AND ESTATES.] The provisions of this
section do not apply to an estate or trust.
Subd. 13. [OVERPAYMENT OF ESTIMATED TAX INSTALLMENT.] If
an installment payment of estimated tax exceeds the correct
amount of the installment payment, the overpayment must be
credited against the unpaid installments, if any.
Sec. 12. [289A.26] [PAYMENT OF ESTIMATED TAX BY
CORPORATIONS.]
Subdivision 1. [MINIMUM LIABILITY.] A corporation subject
to taxation under chapter 290 (excluding section 290.92) must
make payment of estimated tax for the taxable year if its tax
liability so computed can reasonably be expected to exceed $500,
or in accordance with rules prescribed by the commissioner for
an affiliated group of corporations electing to file one return
as permitted under section 289A.08, subdivision 3.
Subd. 2. [AMOUNT AND TIME FOR PAYMENT OF
INSTALLMENTS.] The estimated tax payment required under
subdivision 1 must be paid in four equal installments on or
before the 15th day of the third, sixth, ninth, and 12th month
of the taxable year.
Subd. 3. [SHORT TAXABLE YEAR.] (a) A corporation with a
short taxable year of less than 12 months, but at least four
months, must pay estimated tax in equal installments on or
before the 15th day of the third, sixth, ninth, and final month
of the short taxable year, to the extent applicable based on the
number of months in the short taxable year.
(b) A corporation is not required to make estimated tax
payments for a short taxable year unless its tax liability
before the first day of the last month of the taxable year can
reasonably be expected to exceed $500.
(c) No payment is required for a short taxable year of less
than four months.
Subd. 4. [UNDERPAYMENT OF ESTIMATED TAX.] If there is an
underpayment of estimated tax by a corporation, there shall be
added to the tax for the taxable year an amount determined at
the rate in section 270.75 on the amount of the underpayment,
determined under subdivision 5, for the period of the
underpayment determined under subdivision 6. This subdivision
does not apply in the first taxable year that a corporation is
subject to the tax imposed under section 290.02.
Subd. 5. [AMOUNT OF UNDERPAYMENT.] For purposes of
subdivision 4, the amount of the underpayment is the excess of
(1) the required installment, over
(2) the amount, if any, of the installment paid on or
before the last date prescribed for payment.
Subd. 6. [PERIOD OF UNDERPAYMENT.] The period of the
underpayment runs from the date the installment was required to
be paid to the earlier of the following dates:
(1) the 15th day of the third month following the close of
the taxable year; or
(2) with respect to any part of the underpayment, the date
on which that part is paid. For purposes of this clause, a
payment of estimated tax shall be credited against unpaid
required installments in the order in which those installments
are required to be paid.
Subd. 7. [REQUIRED INSTALLMENTS.] (a) Except as otherwise
provided in this subdivision, the amount of a required
installment is 25 percent of the required annual payment.
(b) Except as otherwise provided in this subdivision, the
term "required annual payment" means the lesser of:
(1) 90 percent of the tax shown on the return for the
taxable year, or if no return is filed, 90 percent of the tax
for that year; or
(2) 100 percent of the tax shown on the return of the
corporation for the preceding taxable year provided the return
was for a full 12-month period, showed a liability, and was
filed by the corporation.
(c) Except for determining the first required installment
for any taxable year, paragraph (b), clause (2), does not apply
in the case of a large corporation. The term "large
corporation" means a corporation or any predecessor corporation
that had taxable net income of $1,000,000 or more for any
taxable year during the testing period. The term "testing
period" means the three taxable years immediately preceding the
taxable year involved. A reduction allowed to a large
corporation for the first installment that is allowed by
applying paragraph (b), clause (2), must be recaptured by
increasing the next required installment by the amount of the
reduction.
(d) In the case of a required installment, if the
corporation establishes that the annualized income installment
is less than the amount determined in paragraph (a), the amount
of the required installment is the annualized income installment
and the recapture of previous quarters' reductions allowed by
this paragraph must be recovered by increasing later required
installments to the extent the reductions have not previously
been recovered.
(e) The "annualized income installment" is the excess, if
any, of:
(1) an amount equal to the applicable percentage of the tax
for the taxable year computed by placing on an annualized basis
the taxable income:
(i) for the first two months of the taxable year, in the
case of the first required installment;
(ii) for the first two months or for the first five months
of the taxable year, in the case of the second required
installment;
(iii) for the first six months or for the first eight
months of the taxable year, in the case of the third required
installment; and
(iv) for the first nine months or for the first 11 months
of the taxable year, in the case of the fourth required
installment, over
(2) the aggregate amount of any prior required installments
for the taxable year.
(3) For the purpose of this paragraph, the annualized
income shall be computed by placing on an annualized basis the
taxable income for the year up to the end of the month preceding
the due date for the quarterly payment multiplied by 12 and
dividing the resulting amount by the number of months in the
taxable year (2, 5, 6, 8, 9, or 11 as the case may be) referred
to in clause (1).
(4) The "applicable percentage" used in clause (1) is:
For the following The applicable
required installments: percentage is:
1st 22.5
2nd 45
3rd 67.5
4th 90
(f)(1) If this paragraph applies, the amount determined for
any installment must be determined in the following manner:
(i) take the taxable income for the months during the
taxable year preceding the filing month;
(ii) divide that amount by the base period percentage for
the months during the taxable year preceding the filing month;
(iii) determine the tax on the amount determined under item
(ii); and
(iv) multiply the tax computed under item (iii) by the base
period percentage for the filing month and the months during the
taxable year preceding the filing month.
(2) For purposes of this paragraph:
(i) the "base period percentage" for a period of months is
the average percent that the taxable income for the
corresponding months in each of the three preceding taxable
years bears to the taxable income for the three preceding
taxable years;
(ii) the term "filing month" means the month in which the
installment is required to be paid;
(iii) this paragraph only applies if the base period
percentage for any six consecutive months of the taxable year
equals or exceeds 70 percent; and
(iv) the commissioner may provide by rule for the
determination of the base period percentage in the case of
reorganizations, new corporations, and other similar
circumstances.
(3) In the case of a required installment determined under
this paragraph, if the corporation determines that the
installment is less than the amount determined in paragraph (a),
the amount of the required installment is the amount determined
under this paragraph and the recapture of previous quarters'
reductions allowed by this paragraph must be recovered by
increasing later required installments to the extent the
reductions have not previously been recovered.
Subd. 8. [DEFINITION OF TAX.] The term "tax" as used in
this section means the tax imposed by chapter 290.
Subd. 9. [FAILURE TO FILE AN ESTIMATE.] In the case of a
corporation that fails to file an estimated tax for a taxable
year when one is required, the period of the underpayment runs
from the four installment dates in subdivision 2 or 3, whichever
applies, to the earlier of the periods in subdivision 6, clauses
(1) and (2).
Subd. 10. [PAYMENT ON ACCOUNT.] Payment of the estimated
tax or any installment of it shall be considered payment on
account of the taxes imposed by chapter 290, for the taxable
year.
Subd. 11. [OVERPAYMENT OF ESTIMATED TAX INSTALLMENT.] If
the amount of an installment payment of estimated tax exceeds
the amount determined to be the correct amount of the
installment payment, the overpayment must be credited against
the unpaid installments, if any.
Sec. 13. [289A.30] [EXTENSIONS FOR PAYING TAX.]
Subdivision 1. [INDIVIDUAL AND FIDUCIARY INCOME, CORPORATE
FRANCHISE TAX.] Where good cause exists, the commissioner may
extend the time for payment of the amount determined as an
individual or fiduciary income tax or corporate franchise tax by
the taxpayer, or an amount determined as a deficiency, for a
period of not more than six months from the date prescribed for
the payment of the tax.
Subd. 2. [ESTATE TAX.] Where good cause exists, the
commissioner may extend the time for payment of estate tax for a
period of not more than six months. If an extension to pay the
federal estate tax has been granted under section 6161 of the
Internal Revenue Code of 1986, as amended through December 31,
1989, the time for payment of the estate tax without penalty is
extended for that period. A taxpayer who owes at least $5,000
in taxes and who, under section 6161 or 6166 of the Internal
Revenue Code of 1986, as amended through December 31, 1989, has
been granted an extension for payment of the tax shown on the
return, may elect to pay the tax due to the commissioner in
equal amounts at the same time as required for federal
purposes. A taxpayer electing to pay the tax in installments
must notify the commissioner in writing no later than nine
months after the death of the person whose estate is subject to
taxation. If the taxpayer fails to pay an installment on time,
unless it is shown that the failure is due to reasonable cause,
the election is revoked and the entire amount of unpaid tax plus
accrued interest is due and payable 90 days after the date on
which the installment was payable.
Sec. 14. [289A.31] [LIABILITY FOR PAYMENT OF TAX.]
Subdivision 1. [INDIVIDUAL INCOME, FIDUCIARY INCOME,
CORPORATE FRANCHISE, AND ENTERTAINMENT TAXES.] (a) Individual
income, fiduciary income, and corporate franchise taxes, and
interest and penalties, must be paid by the taxpayer upon whom
the tax is imposed, except in the following cases:
(1) The tax due from a decedent for that part of the
taxable year in which the decedent died during which the
decedent was alive and the taxes, interest, and penalty due for
the prior years must be paid by the decedent's personal
representative, if any. If there is no personal representative,
the taxes, interest, and penalty must be paid by the
transferees, as defined in section 289A.38, subdivision 13, to
the extent they receive property from the decedent;
(2) The tax due from an infant or other incompetent person
must be paid by the person's guardian or other person authorized
or permitted by law to act for the person;
(3) The tax due from the estate of a decedent must be paid
by the estate's personal representative;
(4) The tax due from a trust, including those within the
definition of a corporation, as defined in section 290.01,
subdivision 4, must be paid by a trustee; and
(5) The tax due from a taxpayer whose business or property
is in charge of a receiver, trustee in bankruptcy, assignee, or
other conservator, must be paid by the person in charge of the
business or property so far as the tax is due to the income from
the business or property.
(b) Entertainment taxes are the joint and several liability
of the entertainer and the entertainment entity. The payor is
liable to the state for the payment of the tax required to be
deducted and withheld under section 290.9201, subdivision 7, and
is not liable to the entertainer for the amount of the payment.
Subd. 2. [JOINT INCOME TAX RETURNS.] If a joint income tax
return is made by a husband and wife, the liability for the tax
is joint and several. A spouse who is relieved of a liability
attributable to a substantial underpayment under section 6013(e)
of the Internal Revenue Code of 1986, as amended through
December 31, 1989, is also relieved of the state income tax
liability on the substantial underpayment.
In the case of individuals who were a husband and wife
prior to the dissolution of their marriage, for tax liabilities
reported on a joint or combined return, the liability of each
person is limited to the proportion of the tax due on the return
that equals that person's proportion of the total tax due if the
husband and wife filed separate returns for the taxable year.
This provision is effective only when the commissioner receives
written notice of the marriage dissolution from the husband or
wife. No refund may be claimed by an ex-spouse for any taxes
paid before receipt by the commissioner of the written notice.
Subd. 3. [TRANSFEREES AND FIDUCIARIES.] The amounts of the
following liabilities are, except as otherwise provided in
section 289A.38, subdivision 13, assessed, collected, and paid
in the same manner and subject to the same provisions and
limitations as a deficiency in a tax imposed by chapter 290,
including any provisions of law for the collection of taxes:
(1) the liability, at law or in equity, of a transferee of
property of a taxpayer for tax, including interest, additional
amounts, and additions to the tax provided by law, imposed upon
the taxpayer by chapter 290; and
(2) the liability of a fiduciary under subdivision 4 for
the payment of tax from the estate of the taxpayer. The
liability may reflect the amount of tax shown on the return or
any deficiency in tax.
Subd. 4. [TAX AS A PERSONAL DEBT OF A FIDUCIARY.] The tax
imposed by chapter 290, and interest and penalties, is a
personal debt of the taxpayer from the time the liability
arises, regardless of when the time for discharging the
liability by payment occurs. The debt is, in the case of the
personal representative of the estate of a decedent and in the
case of any fiduciary, that of the individual in the
individual's official or fiduciary capacity only, unless the
individual has voluntarily distributed the assets held in that
capacity without reserving sufficient assets to pay the tax,
interest, and penalties, in which event the individual is
personally liable for the deficiency.
Subd. 5. [WITHHOLDING TAX, WITHHOLDING FROM PAYMENTS TO
OUT-OF-STATE CONTRACTORS, AND WITHHOLDING BY PARTNERSHIPS AND
SMALL BUSINESS CORPORATIONS.] (a) Except as provided in
paragraph (b), an employer or person withholding tax under
section 290.92 or 290.923, subdivision 2, who fails to pay to or
deposit with the commissioner a sum or sums required by those
sections to be deducted, withheld, and paid, is personally and
individually liable to the state for the sum or sums, and added
penalties and interest, and is not liable to another person for
that payment or payments. The sum or sums deducted and withheld
under section 290.92, subdivision 2a or 3, or 290.923,
subdivision 2, must be held as a special fund in trust for the
state of Minnesota.
(b) If the employer or person withholding tax under section
290.92 or 290.923, subdivision 2, fails to deduct and withhold
the tax in violation of those sections, and later the taxes
against which the tax may be credited are paid, the tax required
to be deducted and withheld will not be collected from the
employer. This does not, however, relieve the employer from
liability for any penalties and interest otherwise applicable
for failure to deduct and withhold.
(c) Liability for payment of withholding taxes includes a
responsible person or entity described in the personal liability
provisions of section 270.101.
(d) Liability for payment of withholding taxes includes a
third party lender or surety described in section 290.92,
subdivision 22.
(e) A partnership or S corporation required to withhold and
remit tax under section 290.92, subdivisions 4b and 4c, is
liable for payment of the tax to the commissioner, and a person
having control of or responsibility for the withholding of the
tax or the filing of returns due in connection with the tax is
personally liable for the tax due.
(f) A payor of sums required to be withheld under section
290.9705, subdivision 1, is liable to the state for the amount
required to be deducted, and is not liable to an out-of-state
contractor for the amount of the payment.
Subd. 6. [ESTATE TAX.] The personal representative and
person to whom property that is subject to taxation under this
chapter is transferred, other than a bona fide purchaser,
mortgagee, or lessee, is personally liable for that tax, until
its payment, to the extent of the value of the property at the
time of the transfer. The exemption from personal liability
extends to subsequent transferees from bona fide purchasers,
mortgagees, and lessees.
Subd. 7. [SALES AND USE TAX.] (a) The sales and use tax
required to be collected by the retailer under chapter 297A
constitutes a debt owed by the retailer to Minnesota, and the
sums collected must be held as a special fund in trust for the
state of Minnesota.
A retailer who does not maintain a place of business within
this state as defined by section 297A.21, subdivision 1, shall
not be indebted to Minnesota for amounts of tax that it was
required to collect but did not collect unless the retailer knew
or had been advised by the commissioner of its obligation to
collect the tax.
(b) The use tax required to be paid by a purchaser is a
debt owed by the purchaser to Minnesota.
(c) The tax imposed by sections 297A.01 to 297A.44, and
interest and penalties, is a personal debt of the individual
required to file a return from the time the liability arises,
irrespective of when the time for payment of that liability
occurs. The debt is, in the case of the executor or
administrator of the estate of a decedent and in the case of a
fiduciary, that of the individual in an official or fiduciary
capacity unless the individual has voluntarily distributed the
assets held in that capacity without reserving sufficient assets
to pay the tax, interest, and penalties, in which case the
individual is personally liable for the deficiency.
(d) Liability for payment of sales and use taxes includes
any responsible person or entity described in the personal
liability provisions of section 270.101.
Sec. 15. [289A.35] [ASSESSMENTS.]
The commissioner shall make determinations, corrections,
and assessments with respect to state taxes, including interest,
additions to taxes, and assessable penalties. The commissioner
may audit and adjust the taxpayer's computation of federal
taxable income to make it conform with the provisions of section
290.01, subdivisions 19 to 19g, or the items of federal tax
preferences or federal credit amounts to make them conform with
the provisions of chapter 290. If a taxpayer fails to file a
required return, the commissioner, from information in the
commissioner's possession or obtainable by the commissioner, may
make a return for the taxpayer. The return will be prima facie
correct and valid. If a return has been filed, the commissioner
shall examine the return and make any audit or investigation
that is considered necessary. The commissioner may use
statistical or other sampling techniques consistent with
generally accepted accounting principles in examining returns or
records and making assessments.
Sec. 16. [289A.36] [EXAMINATIONS; AUDITS AND COLLECTIONS.]
Subdivision 1. [EXAMINATION OF TAXPAYER.] To determine the
accuracy of a return or report, or in fixing liability under
state tax law, or for the purpose of collection, the
commissioner may make reasonable examinations or investigations
of a taxpayer's place of business, tangible personal property,
equipment, computer systems and facilities, pertinent books,
records, papers, vouchers, computer printouts, accounts, and
documents.
Subd. 2. [ACCESS TO RECORDS OF OTHER PERSONS IN CONNECTION
WITH EXAMINATION OF TAXPAYER.] When conducting an investigation
or an audit of a taxpayer, or for the purpose of collection, the
commissioner may examine, except where privileged by law, the
relevant records and files of any person, business, institution,
financial institution, state agency, agency of the United States
government, or agency of any other state where permitted by
statute, agreement, or reciprocity. The commissioner may compel
production of these records by subpoena. A subpoena may be
served directly by the commissioner.
Subd. 3. [POWER TO COMPEL TESTIMONY.] In the
administration of state tax law, the commissioner may:
(1) administer oaths or affirmations and compel by subpoena
the attendance of witnesses, testimony, and the production of a
person's pertinent books, records, papers, or other data;
(2) examine under oath or affirmation any person regarding
the business of any taxpayer concerning any relevant matter
incident to the administration of state tax law. The fees of
witnesses required by the commissioner to attend a hearing are
equal to those allowed to witnesses appearing before courts of
this state. The fees must be paid in the manner provided for
the payment of other expenses incident to the administration of
state tax law; and
(3) in addition to other remedies that may be available,
bring an action in equity by the state against a taxpayer for an
injunction ordering the taxpayer to file a complete and proper
return or amended return. The district courts of this state
have jurisdiction over the action and disobedience of an
injunction issued under this clause will be punished as a
contempt of district court.
Subd. 4. [THIRD PARTY SUBPOENA WHERE TAXPAYER'S IDENTITY
IS KNOWN.] An investigation may extend to a person that the
commissioner determines has access to information that may be
relevant to the examination or investigation. When a subpoena
requiring the production of records as described in subdivision
2 is served on a third-party recordkeeper, written notice of the
subpoena must be mailed to the taxpayer and to any other person
who is identified in the subpoena. The notices must be given
within three days of the day on which the subpoena is served.
Notice to the taxpayer required by this section is sufficient if
it is mailed to the last address on record with the commissioner.
The provisions of this subdivision relating to notice to
the taxpayer or other parties identified in the subpoena do not
apply if there is reasonable cause to believe that the giving of
notice may lead to attempts to conceal, destroy, or alter
records relevant to the examination, to prevent the
communication of information from other persons through
intimidation, bribery, or collusion, or to flee to avoid
prosecution, testifying, or production of records.
Subd. 5. [THIRD PARTY SUBPOENA WHERE TAXPAYER'S IDENTITY
IS NOT KNOWN.] A subpoena that does not identify the person or
persons whose tax liability is being investigated may be served
only if:
(1) the subpoena relates to the investigation of a
particular person or ascertainable group or class of persons;
(2) there is a reasonable basis for believing that the
person or group or class of persons may fail or may have failed
to comply with tax laws administered by the commissioner;
(3) the information sought to be obtained from the
examination of the records, and the identity of the person or
persons with respect to whose liability the subpoena is issued,
is not readily available from other sources;
(4) the subpoena is clear and specific concerning the
information sought to be obtained; and
(5) the information sought to be obtained is limited solely
to the scope of the investigation.
The party served with a subpoena that does not identify the
person or persons with respect to whose tax liability the
subpoena is issued may, within 20 days after service of the
subpoena, petition the district court in the judicial district
in which that party is located for a determination concerning
whether the commissioner has complied with the requirements in
clauses (1) to (5), and thus, whether the subpoena is
enforceable. If no petition is made by the party served within
the time prescribed, the subpoena has the effect of a court
order.
Subd. 6. [REQUEST BY TAXPAYER FOR SUBPOENA.] When the
commissioner has the power to issue a subpoena for investigative
or auditing purposes, the commissioner shall honor a reasonable
request by the taxpayer to issue a subpoena on the taxpayer's
behalf, if in connection with the investigation or audit.
Subd. 7. [APPLICATION TO COURT FOR ENFORCEMENT OF
SUBPOENA.] The commissioner or the taxpayer may apply to the
district court of the county of the taxpayer's residence, place
of business, or county where the subpoena can be served as with
any other case at law, for an order compelling the appearance of
the subpoenaed witness or the production of the subpoenaed
records. If the subpoenaed party fails to comply with the order
of the court, the party may be punished by the court as for
contempt.
Subd. 8. [COST OF PRODUCTION OF RECORDS.] The cost of
producing records of a third party required by a subpoena must
be paid by the taxpayer, if the taxpayer requests the subpoena
to be issued, or if the taxpayer has the records available but
has refused to provide them to the commissioner. In other cases
where the taxpayer cannot produce records and the commissioner
then initiates a subpoena for third-party records, the
commissioner shall pay the reasonable cost of producing the
records. The commissioner may later assess the reasonable costs
against the taxpayer if the records contribute to the
determination of an assessment of tax against the taxpayer.
Sec. 17. [289A.37] [ORDER OF ASSESSMENT.]
Subdivision 1. [ORDER OF ASSESSMENT; NOTICE AND DEMAND TO
TAXPAYER.] (a) When a return has been filed and the commissioner
determines that the tax disclosed by the return is different
than the tax determined by the examination, the commissioner
shall send an order of assessment to the taxpayer. The order
must explain the basis for the assessment and must explain the
taxpayer's appeal rights. An order of assessment is final when
made but may be reconsidered by the commissioner under section
289A.65.
(b) An amount of unpaid tax shown on the order must be paid
to the commissioner: (1) within 60 days after notice of the
amount and demand for its payment have been mailed to the
taxpayer by the commissioner; or (2) if an administrative appeal
is filed under section 289A.65, within 60 days following the
determination of the appeal.
Subd. 2. [ERRONEOUS REFUNDS.] An erroneous refund is
considered an underpayment of tax on the date made. An
assessment of a deficiency arising out of an erroneous refund
may be made at any time within two years from the making of the
refund. If part of the refund was induced by fraud or
misrepresentation of a material fact, the assessment may be made
at any time.
Subd. 3. [ASSESSMENT PRESUMED VALID.] A return or
assessment of tax made by the commissioner is prima facie
correct and valid. The taxpayer has the burden of establishing
its incorrectness or invalidity in any related action or
proceeding.
Subd. 4. [AGGREGATE REFUND OR ASSESSMENT.] The
commissioner, on examining returns of a taxpayer for more than
one year or period, may issue one order covering the period
under examination that reflects the aggregate refund or
additional tax due.
Subd. 5. [SUFFICIENCY OF NOTICE.] An order of assessment,
sent postage prepaid by United States mail to the taxpayer at
the taxpayer's last known address, is sufficient even if the
taxpayer is deceased or is under a legal disability, or, in the
case of a corporation, has terminated its existence, unless the
department has been provided with a new address by a party
authorized to receive notices of assessment.
Subd. 6. [ORDER OF ASSESSMENT IF JOINT INCOME TAX RETURN.]
If a joint income tax return is filed by a husband and wife, an
order of assessment may be a single joint notice. If the
commissioner has been notified by either spouse that that
spouse's address has changed and if that spouse requests it,
then, instead of the single joint notice mailed to the last
known address of the husband and wife, a duplicate or original
of the joint notice must be sent to the requesting spouse at the
address designated by the requesting spouse. The other joint
notice must be mailed to the other spouse at that spouse's last
known address. An assessment is not invalid for failure to send
it to a spouse if the spouse actually receives the notice in the
same period as if it had been mailed to that spouse at the
correct address or if the spouse has failed to provide an
address to the commissioner other than the last known address.
Sec. 18. [289A.38] [LIMITATIONS ON TIME FOR ASSESSMENT OF
TAX.]
Subdivision 1. [GENERAL RULE.] Except as otherwise
provided in this section, the amount of taxes assessable must be
assessed within 3-1/2 years after the date the return is filed.
Subd. 2. [FILING DATE.] For purposes of this section, a
tax return filed before the last day prescribed by law for
filing is considered to be filed on the last day.
Subd. 3. [ESTATE TAXES.] Estate taxes must be assessed
within 180 days after the return and the documents required
under section 289A.10, subdivision 2, have been filed.
Subd. 4. [PROPERTY TAX REFUND.] For purposes of computing
the limitation under this section, the due date of the property
tax refund return as provided for in chapter 290A is the due
date for an income tax return covering the year in which the
rent was paid or the year preceding the year in which the
property taxes are payable.
Subd. 5. [FALSE OR FRAUDULENT RETURN; NO
RETURN.] Notwithstanding the limitations under subdivisions 1
and 3, the tax may be assessed at any time if a false or
fraudulent return is filed or when a taxpayer fails to file a
return.
Subd. 6. [OMISSION IN EXCESS OF 25 PERCENT.] Additional
taxes may be assessed within 6-1/2 years after the due date of
the return or the date the return was filed, whichever is later,
if:
(1) the taxpayer omits from gross income an amount properly
includable in it that is in excess of 25 percent of the amount
of gross income stated in the return;
(2) the taxpayer omits from a sales or withholding tax
return an amount in excess of 25 percent of the taxes reported
in the return; or
(3) the taxpayer omits from the gross estate assets in
excess of 25 percent of the gross estate reported in the return.
Subd. 7. [FEDERAL TAX CHANGES.] If the amount of income,
items of tax preference, deductions, or credits for any year of
a taxpayer as reported to the Internal Revenue Service is
changed or corrected by the commissioner of Internal Revenue or
other officer of the United States or other competent authority,
or where a renegotiation of a contract or subcontract with the
United States results in a change in income, items of tax
preference, deductions, or credits, or, in the case of estate
tax, where there are adjustments to the taxable estate resulting
in a change to the credit for state death taxes, the taxpayer
shall report the change or correction or renegotiation results
in writing to the commissioner, in the form required by the
commissioner. The report must be submitted within 90 days after
the final determination and must concede the accuracy of the
determination or state how it is wrong. A taxpayer filing an
amended federal tax return must also file a copy of the amended
return with the commissioner of revenue within 90 days after
filing the amended return.
Subd. 8. [FAILURE TO REPORT CHANGE OR CORRECTION OF
FEDERAL RETURN.] If a taxpayer fails to make a report as
required by subdivision 7, the commissioner may recompute the
tax, including a refund, based on information available to the
commissioner. The tax may be recomputed within six years after
the report should have been filed, notwithstanding any period of
limitations to the contrary.
Subd. 9. [REPORT MADE OF CHANGE OR CORRECTION OF FEDERAL
RETURN.] If a taxpayer is required to make a report under
subdivision 7, and does report the change or files a copy of the
amended return, the commissioner may recompute and reassess the
tax due, including a refund (1) within one year after the report
or amended return is filed with the commissioner,
notwithstanding any period of limitations to the contrary, or
(2) within any other applicable period stated in this section,
whichever period is longer. The period provided for the
carryback of any amount of loss or credit is also extended as
provided in this subdivision, notwithstanding any law to the
contrary.
Subd. 10. [INCORRECT DETERMINATION OF FEDERAL ADJUSTED
GROSS INCOME.] Notwithstanding any other provision of this
chapter, if a taxpayer whose gross income is determined under
section 290.01, subdivisions 20 and 20e, omits from income an
amount that will under the Internal Revenue Code of 1986, as
amended through December 31, 1989, extend the statute of
limitations for the assessment of federal income taxes, or
otherwise incorrectly determines the taxpayer's federal adjusted
gross income resulting in adjustments by the Internal Revenue
Service, then the period of assessment and determination of tax
will be that under the Internal Revenue Code of 1986, as amended
through December 31, 1989. When a change is made to federal
income during the extended time provided under this subdivision,
the provisions under subdivisions 7 to 9 regarding additional
extensions apply.
Subd. 11. [NET OPERATING LOSS CARRYBACK.] If a deficiency
of tax is attributable to a net operating loss carryback that
has been disallowed in whole or in part, the deficiency may be
assessed at any time that a deficiency for the taxable year of
the loss may be assessed.
Subd. 12. [REQUEST FOR EARLY AUDIT FOR INDIVIDUAL INCOME,
FIDUCIARY INCOME, AND CORPORATE FRANCHISE TAXES.] (a) Tax must
be assessed within 18 months after written request for an
assessment has been made in the case of income received (1)
during the lifetime of a decedent, (2) by the decedent's estate
during the period of administration, (3) by a trustee of a
terminating trust or other fiduciary who, because of custody of
assets, would be liable for the payment of tax under section
289A.31, subdivision 4, or (4) by a corporation. A proceeding
in court for the collection of the tax must begin within two
years after written request for the assessment (filed after the
return is made and in the form the commissioner prescribes) by
the personal representative or other fiduciary representing the
estate of the decedent, or by the trustee of a terminating trust
or other fiduciary who, because of custody of assets, would be
liable for the payment of tax under section 289A.31, subdivision
4, or by the corporation. Except as provided in section
289A.42, subdivision 1, an assessment must not be made after the
expiration of 3-1/2 years after the return was filed, and an
action must not be brought after the expiration of four years
after the return was filed.
(b) Paragraph (a) only applies in the case of a corporation
if:
(1) the written request notifies the commissioner that the
corporation contemplates dissolution at or before the expiration
of the 18-month period;
(2) the dissolution is begun in good faith before the
expiration of the 18-month period; and
(3) the dissolution is completed within the 18-month period.
Subd. 13. [TIME LIMIT FOR ASSESSMENT AND COLLECTION FOR
TRANSFEREE OR FIDUCIARY.] The period of limitation for
assessment and collection of any liability of a transferee or
fiduciary is as follows:
(1) In the case of the liability of an initial transferee
of the property of the taxpayer, the tax may be assessed within
one year after the expiration of the period of limitation of
assessment against the taxpayer. The tax may be collected by
action brought within one year after the expiration of the
period of limitation for the starting of an action against the
taxpayer.
(2) In the case of the liability of the transferee of a
transferee of the property of the taxpayer, the tax may be
assessed within one year after the expiration of the period of
limitation for assessment against the preceding transferee, but
only if within 3-1/2 years after the expiration of the period of
limitation for assessment against the taxpayer. The tax may be
collected by action brought within one year after the expiration
of the period of limitation for the starting of an action
against the preceding transferee, but only if within four years
after the expiration of the period of limitation for bringing an
action against the taxpayer; except that if before the
expiration of the period of limitation for the assessment of the
liability of the transferee a court proceeding for the
collection of the tax or liability has been begun against the
taxpayer or last preceding transferee, liability of the
transferee expires one year after the return of execution in the
court proceeding and the period of limitation for collection by
action will expire one year after the liability is assessed.
(3) In the case of the liability of a fiduciary, the tax
may be assessed up to one year after the liability arises or not
later than the expiration of the period for collection of the
tax for which the liability arises, whichever is later, and may
be collected by action brought within one year after assessment.
(4) For the purposes of this subdivision, if the taxpayer
is deceased, or in the case of a corporation, has ended its
existence, the period of limitation for assessment against the
taxpayer will be the period that would be in effect had death or
termination of existence not occurred.
As used in this subdivision, the term "transferee" includes
heir, legatee, devisee, and distributee.
Subd. 14. [FAILURE TO TIMELY FILE WITHHOLDING
RECONCILIATION.] If an employer fails to timely file the
reconciliation required by section 289A.09, subdivision 2,
paragraph (d), withholding taxes may be assessed within the
period prescribed in subdivision 1, or within one year from the
date the reconciliation is filed with the commissioner,
whichever is later.
Sec. 19. [289A.39] [LIMITATIONS; ARMED SERVICES.]
Subdivision 1. [EXTENSIONS FOR SERVICE MEMBERS.] The
limitations of time provided by this chapter and chapter 290
relating to income taxes and chapter 271 relating to the tax
court for filing returns, paying taxes, claiming refunds,
commencing action thereon, appealing to the tax court from
orders relating to income taxes, and appealing to the Supreme
Court from decisions of the tax court relating to income taxes
are extended, with respect to an individual, for the period
during which the individual serves in the armed forces of the
United States, or serves in support of the armed forces and as
provided in section 7508 of the Internal Revenue Code of 1986,
as amended through December 31, 1989, or serves in an area
designated by the president as a combat zone or is hospitalized
outside the United States as a result of injury received while
serving in the combat during that time and for a further period
of six months.
Subd. 2. [INTEREST AND PENALTIES.] Interest on income tax
must not be assessed or collected from an individual, and
interest must not be paid upon an income tax refund to any
individual, with respect to whom, and for the period during
which, the limitations or time are extended as provided in
subdivision 1. A penalty will not be assessed or collected from
an individual for failure during that period to perform an act
required by the laws described in subdivision 1.
Subd. 3. [ASSESSMENTS; ACTIONS.] The time limitations
provided for the assessment of a tax, penalty, or interest, are
extended, with respect to those individuals and for the period
provided in subdivision 1 and for a further period of six
months; and the time limitations for the commencement of action
to collect a tax, penalty, or interest from those individuals
are extended for a period ending six months after the expiration
of the time for assessment as provided in this section.
Subd. 4. [APPLICABILITY.] Nothing in this section reduces
the time within which an act is required or permitted under this
chapter.
Subd. 5. [EXTENSION LIMITATIONS.] This section does not
extend the time for performing any of the acts set forth in this
chapter beyond the expiration of three months after the
appointment of a personal representative or guardian, in this
state, for any individual described in this section, except as
provided in subdivision 6.
Subd. 6. [DEATH WHILE SERVING IN ARMED FORCES.] If an
individual dies while in active service as a member of the
military or naval forces of the United States or of any of the
United Nations, an income tax imposed under chapter 290 will not
be imposed for the taxable year in which the individual dies.
Income tax imposed for a prior taxable year that is unpaid at
the date of death (including additions to the tax, penalties)
must not be assessed, and if assessed, the assessment must be
abated. In addition, upon the filing of a claim for refund
within seven years from the date the return was filed, the tax
paid or collected with respect to any taxable year beginning
after December 31, 1949, during which the decedent was in active
service must be refunded.
Subd. 7. [DEATH OF CIVILIAN WHILE OUTSIDE UNITED STATES.]
If an individual dies while a civilian employee of the United
States as a result of wounds or injuries incurred while the
individual was a civilian employee of the United States, and
which were incurred outside the United States in a terroristic
or military action, a tax imposed by chapter 290 does not apply
with respect to the taxable year in which the death falls and
with respect to any prior taxable years in the period beginning
with the last taxable year ending before the taxable year in
which the wounds or injury were incurred. Terroristic or
military action has the meaning given it in section 692(c)(2) of
the Internal Revenue Code of 1986, as amended through December
31, 1989.
Sec. 20. [289A.40] [LIMITATIONS ON CLAIMS FOR REFUND.]
Subdivision 1. [TIME LIMIT; GENERALLY.] Unless otherwise
provided in this chapter, a claim for a refund of an overpayment
of state tax must be filed within 3-1/2 years from the date
prescribed for filing the return, plus any extension of time
granted for filing the return, but only if filed within the
extended time, or two years from the time the tax is paid in
full, whichever period expires later.
Subd. 2. [BAD DEBT LOSS.] If a claim relates to an
overpayment because of a failure to deduct a loss due to a bad
debt or to a security becoming worthless, the claim is
considered timely if filed within seven years from the date
prescribed for the filing of the return. The refund or credit
is limited to the amount of overpayment attributable to the loss.
Subd. 3. [NET OPERATING LOSS; INDIVIDUALS.] A refund or
credit must be allowed for a net operating loss carryback to any
taxable year authorized by section 290.095, or section 172 of
the Internal Revenue Code of 1986, as amended through December
31, 1989, but the refund or credit is limited to the amount of
overpayment arising from the carryback.
Sec. 21. [289A.41] [BANKRUPTCY; SUSPENSION OF TIME.]
The running of the period during which a tax must be
assessed or collection proceedings commenced is suspended during
the period from the date of a filing of a petition in bankruptcy
until 30 days after either notice to the commissioner of revenue
that the bankruptcy proceedings have been closed or dismissed,
or the automatic stay has been terminated or has expired,
whichever occurs first.
The suspension of the statute of limitations under this
section applies to the person the petition in bankruptcy is
filed against and other persons who may also be wholly or
partially liable for the tax.
Sec. 22. [289A.42] [CONSENT TO EXTEND STATUTE.]
Subdivision 1. [EXTENSION AGREEMENT.] If before the
expiration of time prescribed in sections 289A.38 and 289A.40
for the assessment of tax or the filing of a claim for refund,
both the commissioner and the taxpayer have consented in writing
to the assessment or filing of a claim for refund after that
time, the tax may be assessed or the claim for refund filed at
any time before the expiration of the agreed upon period. The
period may be extended by later agreements in writing before the
expiration of the period previously agreed upon.
Subd. 2. [FEDERAL EXTENSIONS.] A taxpayer who consents to
an extension of time for the assessment of federal income taxes
must notify the commissioner within 90 days of the execution of
the consent. The period in which the commissioner may recompute
the tax is also extended, notwithstanding any period of
limitations to the contrary, as follows:
(1) for the periods provided in section 289A.38,
subdivisions 8 and 9;
(2) for six months following the expiration of the extended
federal period of limitations when no change is made by the
federal authority.
Sec. 23. [289A.50] [CLAIMS FOR REFUNDS.]
Subdivision 1. [GENERAL RIGHT TO REFUND.] (a) Subject to
the requirements of this section and section 289A.40, a taxpayer
who has paid a tax in excess of the taxes lawfully due and who
files a written claim for refund will be refunded or credited
the overpayment of the tax determined by the commissioner to be
erroneously paid.
(b) The claim must specify the name of the taxpayer, the
date when and the period for which the tax was paid, the kind of
tax paid, the amount of the tax that the taxpayer claims was
erroneously paid, the grounds on which a refund is claimed, and
other information relative to the payment and in the form
required by the commissioner. An income tax, estate tax, or
corporate franchise tax return, or amended return claiming an
overpayment constitutes a claim for refund.
(c) When, in the course of an examination, and within the
time for requesting a refund, the commissioner determines that
there has been an overpayment of tax, the commissioner shall
refund or credit the overpayment to the taxpayer and no demand
is necessary. If the overpayment exceeds $1, the amount of the
overpayment must be refunded to the taxpayer. If the amount of
the overpayment is less than $1, the commissioner is not
required to refund. In these situations, the commissioner does
not have to make written findings or serve notice by mail to the
taxpayer.
(d) If the amount allowable as a credit for withholding or
estimated taxes exceeds the tax against which the credit is
allowable, the amount of the excess is considered an overpayment.
(e) If the entertainment tax withheld at the source exceeds
by $1 or more the taxes, penalties, and interest reported in the
return of the entertainment entity or imposed by section
290.9201, the excess must be refunded to the entertainment
entity. If the excess is less than $1, the commissioner need
not refund that amount.
(f) If the surety deposit required for a construction
contract exceeds the liability of the out-of-state contractor,
the commissioner shall refund the difference to the contractor.
(g) An action of the commissioner in refunding the amount
of the overpayment does not constitute a determination of the
correctness of the return of the taxpayer.
(h) There is appropriated from the general fund to the
commissioner of revenue the amount necessary to pay refunds
allowed under this section.
Subd. 2. [REFUND OF SALES TAX TO VENDORS; LIMITATION.] If
a vendor has collected from a purchaser and remitted to the
state a tax on a transaction that is not subject to the tax
imposed by chapter 297A, the tax is refundable to the vendor
only if and to the extent that it is credited to amounts due to
the vendor by the purchaser or returned to the purchaser by the
vendor.
Subd. 3. [WITHHOLDING TAX AND ENTERTAINER WITHHOLDING TAX
REFUNDS.] When there is an overpayment of withholding tax by an
employer or a person making royalty payments, or an overpayment
of entertainer withholding tax by the payor, a refund allowable
under this section is limited to the amount of the overpayment
that was not deducted and withheld from employee wages or from
the royalty payments, or from the compensation of an entertainer.
Subd. 4. [NOTICE OF REFUND.] The commissioner shall
determine the amount of refund, if any, that is due, and notify
the taxpayer of the determination as soon as practicable after a
claim has been filed.
Subd. 5. [WITHHOLDING OF REFUNDS FROM CHILD SUPPORT
DEBTORS.] (a) If a court of this state finds that a person
obligated to pay child support is delinquent in making payments,
the amount of child support unpaid and owing, including attorney
fees and costs incurred in ascertaining or collecting child
support, must be withheld from a refund due the person under
chapter 290. The public agency responsible for child support
enforcement or the parent or guardian of a child for whom the
support, attorney fees, and costs are owed may petition the
district or county court for an order providing for the
withholding of the amount of child support, attorney fees, and
costs unpaid and owing as determined by court order. The person
from whom the refund may be withheld must be notified of the
petition under the rules of civil procedure before the issuance
of an order under this subdivision. The order may be granted on
a showing to the court that required support payments, attorney
fees, and costs have not been paid when they were due.
(b) On order of the court and on payment of $3 to the
commissioner, the commissioner shall withhold the money from the
refund due to the person obligated to pay the child support.
The amount withheld shall be remitted to the public agency
responsible for child support enforcement or to the parent or
guardian petitioning on behalf of the child, after any
delinquent tax obligations of the taxpayer owed to the revenue
department have been satisfied. An amount received by the
responsible public agency or the petitioning parent or guardian
in excess of the amount of public assistance spent for the
benefit of the child to be supported, or the amount of any
support, attorney fees, and costs that had been the subject of
the claim under this subdivision that has been paid by the
taxpayer before the diversion of the refund, must be paid to the
person entitled to the money. If the refund is based on a joint
return, the part of the refund that must be paid to the
petitioner is the proportion of the total refund that equals the
proportion of the total federal adjusted gross income of the
spouses that is the federal adjusted gross income of the spouse
who is delinquent in making the child support payments.
(c) A petition filed under this subdivision remains in
effect with respect to any refunds due under this section until
the support money, attorney fees, and costs have been paid in
full or the court orders the commissioner to discontinue
withholding the money from the refund due the person obligated
to pay the support, attorney fees, and costs. If a petition is
filed under this subdivision and a claim is made under chapter
270A with respect to the individual's refund and notices of both
are received before the time when payment of the refund is made
on either claim, the claim relating to the liability that
accrued first in time must be paid first. The amount of the
refund remaining must then be applied to the other claim.
Subd. 6. [OFFSETTING OF INCOME TAX
REFUNDS.] Notwithstanding any other law to the contrary, in the
case of an overpayment, the commissioner, within the applicable
period of limitations, may credit the amount of the overpayment
against a liability with respect to Minnesota income tax on the
part of the person who made the overpayment or against a
liability with respect to Minnesota income tax on the part of
either spouse who filed a joint return for the taxable year in
which the overpayment was made and must refund a balance of more
than $1 to the person if the taxpayer so requests.
Subd. 7. [REMEDIES.] (a) If the taxpayer is notified by
the commissioner that the refund claim is denied in whole or in
part, the taxpayer may:
(1) file an administrative appeal as provided in section
289A.65, or an appeal with the tax court, within 60 days after
issuance of the commissioner's notice of denial; or
(2) file an action in the district court to recover the
refund.
(b) An action in the district court on a denied claim for
refund must be brought within 18 months of the date of the
denial of the claim by the commissioner.
(c) No action in the district court or the tax court shall
be brought within six months of the filing of the refund claim
unless the commissioner denies the claim within that period.
(d) If a taxpayer files a claim for refund and the
commissioner has not issued a denial of the claim, the taxpayer
may bring an action in the district court or the tax court at
any time after the expiration of six months of the time the
claim was filed, but within four years of the date that the
claim was filed.
(e) The commissioner and the taxpayer may agree to extend
the period for bringing an action in the district court.
(f) An action for refund of tax by the taxpayer must be
brought in the district court of the district in which lies the
county of the taxpayer's residence or principal place of
business. In the case of an estate or trust, the action must be
brought at the principal place of its administration. Any
action may be brought in the district court for Ramsey county.
Subd. 8. [MISTAKE DISCOVERED BY COMMISSIONER.] If money
has been erroneously collected from a taxpayer or other person,
the commissioner shall, within the period named in section
289A.40 for filing a claim for refund, and, subject to the
provisions of section 270.07, subdivision 5, chapter 270A, and
this section, grant a refund to that taxpayer or other person.
Sec. 24. [289A.55] [INTEREST PAYABLE TO COMMISSIONER.]
Subdivision 1. [INTEREST RATE.] When interest is required
under this section, interest is computed at the rate specified
in section 270.75.
Subd. 2. [LATE PAYMENT.] If a tax is not paid within the
time named by law for payment, the unpaid tax bears interest
from the date the tax should have been paid until the date the
tax is paid.
Subd. 3. [EXTENSIONS.] When an extension of time for
payment has been granted, interest must be paid from the date
the payment should have been made, if no extension had been
granted, until the date the tax is paid.
Subd. 4. [ADDITIONAL ASSESSMENTS.] When a taxpayer is
liable for additional taxes because of a redetermination by the
commissioner, or for any other reason, the additional taxes bear
interest from the time the tax should have been paid, without
regard to an extension allowed, until the date the tax is paid.
Subd. 5. [EXCESSIVE CLAIMS FOR REFUNDS UNDER CHAPTER
290A.] When it is determined that a claim for a property tax
refund was excessive, the amount that the taxpayer must repay
bears interest from the date the claim was paid until the date
of repayment.
Subd. 6. [ERRONEOUS REFUNDS.] In the case of an erroneous
refund, interest begins to accrue from the date the refund was
paid unless the erroneous refund results from a mistake of the
department, in which case no interest or penalty will be
imposed, unless the deficiency assessment is not satisfied
within 60 days of the order.
Subd. 7. [INSTALLMENT PAYMENTS; ESTATE TAX.] Interest must
be paid on unpaid installment payments of the tax authorized
under section 289A.30, subdivision 2, beginning on the date the
tax was due without regard to extensions allowed or extensions
elected, at the rate of interest in effect under section 270.75,
nine months following the date of death.
Subd. 8. [INTEREST ON JUDGMENTS.] Notwithstanding section
549.09, if judgment is entered in favor of the commissioner with
regard to any tax, the judgment bears interest at the rate given
in section 270.75 from the date the judgment is entered until
the date of payment.
Subd. 9. [INTEREST ON PENALTIES.] (a) A penalty imposed
under section 289A.60, subdivision 1, 2, 3, 4, 5, or 6, bears
interest from the date the return or payment was required to be
filed or paid, including any extensions, to the date of payment
of the penalty.
(b) A penalty not included in paragraph (a) bears interest
only if it is not paid within ten days from the date of notice.
In that case interest is imposed from the date of notice to the
date of payment.
Sec. 25. [289A.56] [INTEREST ON OVERPAYMENTS.]
Subdivision 1. [INTEREST RATE.] When interest is due on an
overpayment under this section, it must be computed at the rate
specified in section 270.76.
Subd. 2. [CORPORATE FRANCHISE, INDIVIDUAL AND FIDUCIARY
INCOME, AND ENTERTAINER TAX OVERPAYMENTS.] Interest must be paid
on an overpayment refunded or credited to the taxpayer from the
date of payment of the tax until the date the refund is paid or
credited. For purposes of this subdivision, the prepayment of
tax made by withholding of tax at the source or payment of
estimated tax before the due date is considered paid on the last
day prescribed by law for the payment of the tax by the
taxpayer. A return filed before the due date is considered as
filed on the due date.
When the amount of tax withheld at the source or paid as
estimated tax or allowable as other refundable credits, or
withheld from compensation of entertainers, exceeds the tax
shown on the original return by $10, the amount refunded bears
interest from 90 days after (1) the due date of the return of
the taxpayer, or (2) the date on which the original return is
filed, whichever is later, until the date the refund is paid to
the taxpayer. Where the amount to be refunded is less than $10,
no interest is paid. However, to the extent that the basis for
the refund is a net operating loss carryback, interest is
computed only from the end of the taxable year in which the loss
occurs.
Subd. 3. [WITHHOLDING TAX, ENTERTAINER WITHHOLDING TAX,
WITHHOLDING FROM PAYMENTS TO OUT-OF-STATE CONTRACTORS, ESTATE
TAX, AND SALES TAX OVERPAYMENTS.] When a refund is due for
overpayments of withholding tax, entertainer withholding tax,
withholding from payments to out-of-state contractors, estate
tax, or sales tax, interest is computed from the date of payment
to the date the refund is paid or credited. For purposes of
this subdivision, the date of payment is the later of the date
the tax was finally due or was paid.
Subd. 4. [CAPITAL EQUIPMENT REFUNDS.] Notwithstanding
subdivision 3, for refunds payable under section 297A.15,
subdivision 5, interest is computed from the date the refund
claim is filed with the commissioner.
Subd. 5. [SALES OR MOTOR VEHICLE EXCISE TAX; RETAILERS.]
In the case of a refund allowed under section 297A.211,
subdivision 3, interest is allowed only from the date on which
the person has both registered as a retailer and filed a claim
for refund.
Subd. 6. [PROPERTY TAX REFUNDS UNDER CHAPTER 290A.] (a)
When a renter is owed a property tax refund, an unpaid refund
bears interest after August 14, or 60 days after the refund
claim was made, whichever is later, until the date the refund is
paid.
(b) When any other claimant is owed a property tax refund,
the unpaid refund bears interest after September 29, or 60 days
after the refund claim was made, whichever is later, until the
date the refund is paid.
Sec. 26. [289A.60] [CIVIL PENALTIES.]
Subdivision 1. [PENALTY FOR FAILURE TO PAY TAX.] If a tax
is not paid or amounts required to be withheld are not remitted
within the time specified for payment, a penalty must be added
to the amount required to be shown as tax. The penalty is three
percent of the tax not paid on or before the date specified for
payment of the tax if the failure is for not more than 30 days,
with an additional penalty of three percent of the amount of tax
remaining unpaid during each additional 30 days or fraction of
30 days during which the failure continues, not exceeding 24
percent in the aggregate.
Subd. 2. [PENALTY FOR FAILURE TO MAKE AND FILE RETURN.] If
a taxpayer fails to make and file a return within the time
prescribed or an extension, a penalty is added to the tax. The
penalty is three percent of the amount of tax not paid on or
before the date prescribed for payment of the tax including any
extensions if the failure is for not more than 30 days, with an
additional five percent of the amount of tax remaining unpaid
during each additional 30 days or fraction of 30 days, during
which the failure continues, not exceeding 23 percent in the
aggregate.
If a taxpayer fails to file a return, other than an income
tax return of an individual, within 60 days of the date
prescribed for filing of the return (determined with regard to
any extension of time for filing), the addition to tax under
this subdivision must not be less than the lesser of: (1) $200;
or (2) the greater of (a) 25 percent of the amount required to
be shown as tax on the return without reduction for any payments
made or refundable credits allowable against the tax, or (b) $50.
Subd. 3. [COMBINED PENALTIES.] When penalties are imposed
under subdivisions 1 and 2, except for the minimum penalty under
subdivision 2, the penalties imposed under both subdivisions
combined must not exceed 38 percent.
Subd. 4. [SUBSTANTIAL UNDERSTATEMENT OF LIABILITY;
PENALTY.] The commissioner of revenue shall impose a penalty for
substantial understatement of any tax payable to the
commissioner, except a tax imposed under chapter 297A.
There must be added to the tax an amount equal to 20
percent of the amount of any underpayment attributable to the
understatement. There is a substantial understatement of tax
for the period if the amount of the understatement for the
period exceeds the greater of: (1) ten percent of the tax
required to be shown on the return for the period; or (2)(a)
$10,000 in the case of a corporation other than an S corporation
as defined in section 290.9725 when the tax is imposed by
chapter 290, or (b) $5,000 in the case of any other taxpayer,
and in the case of a corporation any tax not imposed by chapter
290. The term "understatement" means the excess of the amount
of the tax required to be shown on the return for the period,
over the amount of the tax imposed that is shown on the return.
The amount of the understatement shall be reduced by that part
of the understatement that is attributable to the tax treatment
of any item by the taxpayer if there is or was substantial
authority for the treatment, or any item with respect to which
the relevant facts affecting the item's tax treatment are
adequately disclosed in the return or in a statement attached to
the return. The special rules in cases involving tax shelters
provided in section 6662(d)(2)(C) of the Internal Revenue Code
of 1986, as amended through December 31, 1989, shall apply and
shall apply to a tax shelter the principal purpose of which is
the avoidance or evasion of state taxes. The commissioner may
abate all or any part of the addition to the tax provided by
this section on a showing by the taxpayer that there was
reasonable cause for the understatement, or part of it, and that
the taxpayer acted in good faith. The additional tax and
penalty shall bear interest at the rate specified in section
270.75 from the time the tax should have been paid until paid.
Subd. 5. [PENALTY FOR INTENTIONAL DISREGARD OF LAW OR
RULES.] If part of an additional assessment is due to negligence
or intentional disregard of the provisions of the applicable tax
laws or rules of the commissioner, but without intent to
defraud, there must be added to the tax an amount equal to ten
percent of the additional assessment.
Subd. 6. [PENALTY FOR FALSE OR FRAUDULENT RETURN,
EVASION.] If a person files a false or fraudulent return, or
attempts in any manner to evade or defeat a tax or payment of
tax, there is imposed on the person a penalty equal to 50
percent of the tax, less amounts paid by the person on the basis
of the false or fraudulent return, due for the period to which
the return related.
Subd. 7. [PENALTY FOR FRIVOLOUS RETURN.] If an individual
files what purports to be a tax return required by chapter 290
but which does not contain information on which the substantial
correctness of the assessment may be judged or contains
information that on its face shows that the assessment is
substantially incorrect and the conduct is due to a position
that is frivolous or a desire that appears on the purported
return to delay or impede the administration of Minnesota tax
laws, then the individual shall pay a penalty of $500. In a
proceeding involving the issue of whether or not a person is
liable for this penalty, the burden of proof is on the
commissioner.
Subd. 8. [PENALTY FOR FAILURE TO FILE INFORMATIONAL
RETURN.] In the case of a failure to file an informational
return required by section 289A.12 with the commissioner on the
date prescribed (determined with regard to any extension of time
for filing), the person failing to file the return shall pay a
penalty of $50 for each failure or in the case of a partnership,
S corporation, or fiduciary return, $50 for each partner,
shareholder, or beneficiary; but the total amount imposed on the
delinquent person for all failures during any calendar year must
not exceed $25,000. If a failure to file a return is due to
intentional disregard of the filing requirement, then the
penalty imposed under the preceding sentence must not be less
than an amount equal to:
(1) in the case of a return not described in clause (2) or
(3), ten percent of the aggregate amount of the items required
to be reported;
(2) in the case of a return required to be filed under
section 289A.12, subdivision 5, five percent of the gross
proceeds required to be reported; and
(3) in the case of a return required to be filed under
section 289A.12, subdivision 9, relating to direct sales, $100
for each failure; however, the total amount imposed on the
delinquent person for intentional failures during a calendar
year must not exceed $50,000. The penalty must be collected in
the same manner as a delinquent income tax.
Subd. 9. [PENALTIES FOR FAILURE TO GIVE ANNUAL REPORT
INFORMATION BY EXEMPT INDIVIDUALS, CORPORATIONS.] In the case of
a failure to give annual report information as prescribed by
section 290.05, subdivision 4, the exempt individual or
corporation shall pay the commissioner a penalty of $100 for
each failure.
Subd. 10. [PENALTY FOR FAILURE TO PROVIDE SOCIAL SECURITY
NUMBER AS REQUIRED.] A person who is required by law to: (1)
give the person's social security account number to another
person; or (2) include in a return, statement, or other document
made with respect to another person that individual's social
security account number, who fails to comply with the
requirement when prescribed, must pay a penalty of $50 for each
failure. The total amount imposed on a person for failures
during a calendar year must not exceed $25,000.
Subd. 11. [PENALTIES RELATING TO INFORMATION REPORTS,
WITHHOLDING.] (a) When a person required under section 289A.409
subdivision 2, to give a statement to an employee or payee and a
duplicate statement to the commissioner, or to give a
reconciliation of the statements and quarterly returns to the
commissioner, gives a false or fraudulent statement to an
employee or payee or a false or fraudulent duplicate statement
or reconciliation of statements and quarterly returns to the
commissioner, or fails to give a statement or the reconciliation
in the manner, when due, and showing the information required by
section 289A.09, subdivision 2, or rules prescribed by the
commissioner under that section, that person is liable for a
penalty of $50 for an act or failure to act. The total amount
imposed on the delinquent person for failures during a calendar
year must not exceed $25,000.
(b) In addition to any other penalty provided by law, an
employee who gives a withholding exemption certificate or a
residency affidavit to an employer that the employee has reason
to know contains a materially incorrect statement is liable to
the commissioner of revenue for a penalty of $500 for each
instance.
(c) In addition to any other penalty provided by law, an
employer who fails to submit a copy of a withholding exemption
certificate or a residency affidavit required by section 290.92,
subdivision 5a, clause (1)(a), (1)(b), or (2) is liable to the
commissioner of revenue for a penalty of $50 for each instance.
(d) An employer or payor who fails to file an application
for a withholding account number, as required by section 290.92,
subdivision 24, is liable to the commissioner for a penalty of
$100.
Subd. 12. [PENALTIES RELATING TO PROPERTY TAX REFUNDS.]
(a) If the commissioner determines that a property tax refund
claim is or was excessive and was filed with fraudulent intent,
the claim must be disallowed in full. If the claim has been
paid, the amount disallowed may be recovered by assessment and
collection.
(b) If it is determined that a property tax refund claim is
excessive and was negligently prepared, ten percent of the
corrected claim must be disallowed. If the claim has been paid,
the amount disallowed must be recovered by assessment and
collection.
(c) An owner or managing agent who knowingly fails to give
a certificate of rent constituting property tax to a renter, as
required by section 290A.19, paragraph (a), is liable to the
commissioner for a penalty of $100 for each failure.
(d) If the owner or managing agent knowingly gives rent
certificates that report total rent constituting property taxes
in excess of the amount of actual property taxes paid on the
rented part of a property, the owner or managing agent is liable
for a penalty equal to the greater of (1) $100 or (2) 50 percent
of the excess that is reported.
(e) A claim filed after the original or extended due date
will be reduced by five percent of the amount otherwise
allowable, plus an additional five percent for each month of
delinquency, not exceeding a total reduction of 25 percent,
which may be canceled or reduced by the commissioner if the
delinquency is due to reasonable cause. In any event, no claim
is allowed if the initial claim is filed more than one year
after the original due date for filing the claim.
Subd. 13. [PENALTIES FOR TAX RETURN PREPARERS.] (a) If an
understatement of liability with respect to a return or claim
for refund is due to a willful attempt in any manner to
understate the liability for a tax by a person who is a tax
return preparer with respect to the return or claim, the person
shall pay to the commissioner a penalty of $500. If a part of a
property tax refund claim is excessive due to a willful attempt
in any manner to overstate the claim for relief allowed under
chapter 290A by a person who is a tax refund or return preparer,
the person shall pay to the commissioner a penalty of $500 with
respect to the claim. These penalties may not be assessed
against the employer of a tax return preparer unless the
employer was actively involved in the willful attempt to
understate the liability for a tax or to overstate the claim for
refund. These penalties are income tax liabilities and may be
assessed at any time as provided in section 289A.38, subdivision
5.
(b) A civil action in the name of the state of Minnesota
may be commenced to enjoin any person who is a tax return
preparer doing business in this state from further engaging in
any conduct described in paragraph (c). An action under this
paragraph must be brought by the attorney general in the
district court for the judicial district of the tax return
preparer's residence or principal place of business, or in which
the taxpayer with respect to whose tax return the action is
brought resides. The court may exercise its jurisdiction over
the action separate and apart from any other action brought by
the state of Minnesota against the tax return preparer or any
taxpayer.
(c) In an action under paragraph (b), if the court finds
that a tax return preparer has:
(1) engaged in any conduct subject to a civil penalty under
section 289A.60 or a criminal penalty under section 289A.63;
(2) misrepresented the preparer's eligibility to practice
before the department of revenue, or otherwise misrepresented
the preparer's experience or education as a tax return preparer;
(3) guaranteed the payment of any tax refund or the
allowance of any tax credit; or
(4) engaged in any other fraudulent or deceptive conduct
that substantially interferes with the proper administration of
state tax law, and injunctive relief is appropriate to prevent
the recurrence of that conduct,
the court may enjoin the person from further engaging in that
conduct.
(d) If the court finds that a tax return preparer has
continually or repeatedly engaged in conduct described in
paragraph (c), and that an injunction prohibiting that conduct
would not be sufficient to prevent the person's interference
with the proper administration of state tax laws, the court may
enjoin the person from acting as a tax return preparer. The
court may not enjoin the employer of a tax return preparer for
conduct described in paragraph (c) engaged in by one or more of
the employer's employees unless the employer was also actively
involved in that conduct.
(e) For purposes of this subdivision, the term
"understatement of liability" means an understatement of the net
amount payable with respect to a tax imposed by state tax law,
or an overstatement of the net amount creditable or refundable
with respect to a tax. The determination of whether or not
there is an understatement of liability must be made without
regard to any administrative or judicial action involving the
taxpayer. For purposes of this subdivision, the amount
determined for underpayment of estimated tax under either
section 289A.25 or 289A.26 is not considered an understatement
of liability.
(f) For purposes of this subdivision, the term
"overstatement of claim" means an overstatement of the net
amount refundable with respect to a claim for property tax
relief provided by chapter 290A. The determination of whether
or not there is an overstatement of a claim must be made without
regard to administrative or judicial action involving the
claimant.
(g) For purposes of this section, the term "tax refund or
return preparer" means an individual who prepares for
compensation, or who employs one or more individuals to prepare
for compensation, a return of tax, or a claim for refund of
tax. The preparation of a substantial part of a return or claim
for refund is treated as if it were the preparation of the
entire return or claim for refund. An individual is not
considered a tax return preparer merely because the individual:
(1) gives typing, reproducing, or other mechanical
assistance;
(2) prepares a return or claim for refund of the employer,
or an officer or employee of the employer, by whom the
individual is regularly and continuously employed;
(3) prepares a return or claim for refund of any person as
a fiduciary for that person; or
(4) prepares a claim for refund for a taxpayer in response
to a tax order issued to the taxpayer.
Subd. 14. [PENALTY FOR USE OF SALES TAX EXEMPTION
CERTIFICATES TO EVADE TAX.] A person who uses an exemption
certificate to buy property that will be used for purposes other
than the exemption claimed, with the intent to evade payment of
sales tax to the seller, is subject to a penalty of $100 for
each transaction where that use of an exemption certificate has
occurred.
Subd. 15. [ACCELERATED PAYMENT OF JUNE SALES TAX
LIABILITY; PENALTY FOR UNDERPAYMENT.] If a vendor is required by
law to submit an estimation of June sales tax liabilities and
one-half payment by a certain date, and the vendor fails to
remit the balance due by the date required, the vendor shall pay
a penalty equal to ten percent of the amount of actual June
liability required to be paid in June less the amount remitted
in June. The penalty must not be imposed, however, if the
amount remitted in June equals the lesser of: (1) 45 percent of
the actual June liability, or (2) 50 percent of the preceding
May's liability.
Subd. 16. [PENALTY FOR SALES AFTER REVOCATION.] A person
who engages in the business of making retail sales after
revocation of a permit under section 297A.07 is liable for a
penalty of $100 for each day the person continues to make
taxable sales.
Subd. 17. [OPERATOR OF FLEA MARKETS; PENALTY.] A person
who fails to comply with the provisions of section 297A.041 is
subject to a penalty of $100 for each day of each selling event
that the operator fails to obtain evidence that a seller is the
holder of a valid seller's permit issued under section 297A.04.
Subd. 18. [PAYMENT OF PENALTIES.] The penalties imposed by
this section are collected and paid in the same manner as taxes.
Subd. 19. [PENALTIES ARE ADDITIONAL.] The civil penalties
imposed by this section are in addition to the criminal
penalties imposed by this chapter.
Sec. 27. [289A.63] [CRIMINAL PENALTIES.]
Subdivision 1. [PENALTIES FOR KNOWING FAILURE TO FILE OR
PAY; WILLFUL EVASION.] (a) A person required to file a return,
report, or other document with the commissioner, who knowingly,
rather than accidentally, inadvertently, or negligently, fails
to file it when required, is guilty of a gross misdemeanor. A
person required to file a return, report, or other document who
willfully attempts in any manner to evade or defeat a tax by
failing to file it when required, is guilty of a felony.
(b) A person required to pay or to collect and remit a tax,
who knowingly, rather than accidentally, inadvertently, or
negligently, fails to do so when required, is guilty of a gross
misdemeanor. A person required to pay or to collect and remit a
tax, who willfully attempts to evade or defeat a tax law by
failing to do so when required, is guilty of a felony.
Subd. 2. [FALSE OR FRAUDULENT RETURNS; PENALTIES.] (a) A
person who files with the commissioner a return, report, or
other document, known by the person to be fraudulent or false
concerning a material matter, is guilty of a felony.
(b) A person who knowingly aids or assists in, or advises
in the preparation or presentation of a return, report, or other
document that is fraudulent or false concerning a material
matter, whether or not the falsity or fraud committed is with
the knowledge or consent of the person authorized or required to
present the return, report, or other document, is guilty of a
felony.
Subd. 3. [SALES WITHOUT PERMIT; VIOLATIONS.] (a) A person
who engages in the business of making retail sales in Minnesota
without the permit or permits required under chapter 297A, or a
responsible officer of a corporation who so engages in business,
is guilty of a gross misdemeanor.
(b) A person who engages in the business of making retail
sales in Minnesota after revocation of a permit under section
297A.07, when the commissioner has not issued a new permit, is
guilty of a felony.
Subd. 4. [ADVERTISING NO SALES OR USE TAX; VIOLATION.] It
is a misdemeanor for a person to broadcast or publish, or
arrange to have broadcast or published, an advertisement in a
publication or broadcast media, printed, distributed, broadcast,
or intended to be received in this state, that states that no
sales or use tax is due, when the person knows the advertisement
is false.
Subd. 5. [EMPLOYEE GIVING EMPLOYER FALSE INFORMATION.] An
employee required to supply information to an employer under
section 290.92, subdivisions 4a and 5, who knowingly fails to
supply information or who knowingly supplies false or fraudulent
information to an employer, is guilty of a gross misdemeanor.
Subd. 6. [COLLECTION OF TAX; PENALTY.] An agent,
canvasser, or employee of a retailer, who is not authorized by
permit from the commissioner, may not collect the sales tax as
imposed by chapter 297A, nor sell, solicit orders for, nor
deliver, any tangible personal property in this state. An
agent, canvasser, or employee violating the provisions of
sections 297A.14 to 297A.25 is guilty of a misdemeanor.
Subd. 7. [UNAUTHORIZED DISCLOSURE.] Any person disclosing
any particulars of any tax return, without the written consent
of the taxpayer making such return, in violation of the
provisions of section 290.611, is guilty of a gross misdemeanor.
Subd. 8. [CRIMINAL PENALTIES.] Criminal penalties imposed
by this section are in addition to any civil penalties imposed
by this chapter.
Subd. 9. [STATUTE OF LIMITATIONS.] Notwithstanding section
628.26, or any other provision of the criminal laws of this
state, an indictment may be found and filed, or a complaint
filed, upon a criminal offense named in this section, in the
proper court within six years after the offense is committed.
Subd. 10. [PERSON DEFINED.] The term "person" as used in
this section includes any officer or employee of a corporation
or a member or employee of a partnership who as an officer,
member, or employee is under a duty to perform the act in
respect to which the violation occurs.
Sec. 28. Minnesota Statutes 1988, section 290.05,
subdivision 4, is amended to read:
Subd. 4. (a) Corporations, individuals, estates, trusts or
organizations claiming exemption under the provisions of
subdivision 2 shall furnish information as to concerning their
exempt status under the Internal Revenue Code.
(b) Such Corporations, individuals, estates, trusts, and
organizations shall file with the commissioner of revenue a copy
of any an annual report that is required to be filed with the
Internal Revenue Service, no later than ten days after filing
the same it with the Internal Revenue Service. Any An annual
report required of a pension plan under sections 6057 to 6059 of
the Internal Revenue Code of 1954, does not need to be filed
with the commissioner.
Any person required to file a copy of a federal return
pursuant to the preceding paragraph who willfully fails to file
such return shall be guilty of a misdemeanor.
(c) In the event that If the Internal Revenue Service
revokes, cancels or suspends, in whole or part, the exempt
status of any corporation, individual, estate, trust or
organization referred to in clause paragraph (a), or if the
amount of gross income, deductions, credits, items of tax
preference or taxable income is changed or corrected by either
the taxpayer or the Internal Revenue Service, or if the taxpayer
consents to any extension of time for assessment of federal
income taxes such, the corporation, individual, estate, trust or
organization shall notify the commissioner in writing of such
the action within 90 days thereafter after that date.
(d) The periods of limitations contained in section 290.56
shall 289A.42, subdivision 2, apply whenever when there has been
any action referred to in clause paragraph (c), notwithstanding
any period of limitations to the contrary.
Sec. 29. Minnesota Statutes Second 1989 Supplement,
section 290.92, subdivision 4b, is amended to read:
Subd. 4b. [WITHHOLDING BY PARTNERSHIPS.] (a) A partnership
shall deduct and withhold a tax as provided in paragraph (b)
when the partnership pays or credits amounts to any of its
nonresident individual partners on account of their distributive
shares of partnership income for a taxable year of the
partnership.
(b) The amount of tax withheld is determined by multiplying
the partner's distributive share allocable to Minnesota under
section 290.17, paid or credited during the taxable year by the
highest rate used to determine the income tax liability for an
individual under section 290.06, subdivision 2c, except that the
amount of tax withheld may be determined based on tables
provided by the commissioner if the partner submits a
withholding exemption certificate under subdivision 5.
(c) A partnership required to deduct and withhold tax under
this subdivision shall file a return with the commissioner. The
tax required to be deducted and withheld during that year must
be paid with the return. The return and payment is due on or
before the due date specified for filing the partnership return
under section 290.42.
(d) A partnership required to withhold and remit tax under
this subdivision is liable for payment of the tax to the
commissioner, and a person having control of or responsibility
for the withholding of the tax or the filing of returns due
under this subdivision is personally liable for the tax due.
The commissioner may reduce or abate the tax withheld under this
subdivision if the partnership had reasonable cause to believe
that no tax was due under this section.
(e) (d) Notwithstanding paragraph (a), a partnership is not
required to deduct and withhold tax for a nonresident partner if:
(1) the partner elects to have the tax due paid as part of
the partnership's composite return under section 290.39,
subdivision 5;
(2) the partner has Minnesota assignable federal adjusted
gross income from the partnership of less than $1,000; or
(3) the partnership is liquidated or terminated, the income
was generated by a transaction related to the termination or
liquidation, and no cash or other property was distributed in
the current or prior taxable year; or
(4) the distributive shares of partnership income are
attributable to:
(i) income required to be recognized because of discharge
of indebtedness;
(ii) income recognized because of a sale, exchange, or
other disposition of real estate, depreciable property, or
property described in section 179 of the Internal Revenue Code
of 1986, as amended through December 31, 1988; or
(iii) income recognized on the sale, exchange, or other
disposition of any property that has been the subject of a basis
reduction pursuant to section 108, 734, 743, 754, or 1017 of the
Internal Revenue Code of 1986, as amended through December 31,
1988,
to the extent that the income does not include cash received or
receivable or, if there is cash received or receivable, to the
extent that the cash is required to be used to pay indebtedness
by the partnership or a secured debt on partnership property.
(f) (e) For purposes of subdivisions 6, paragraph (1)(c),
subdivision 6a, 7, 11, and 15, and sections 289A.09, subdivision
2, 289A.20, subdivision 2, paragraph (c), 289A.50, 289A.56,
289A.60, and 289A.63, a partnership is considered an employer.
(g) (f) To the extent that income is exempt from
withholding under paragraph (e) (d), clause (4), the
commissioner has a lien in an amount up to the amount that would
be required to be withheld with respect to the income of the
partner attributable to the partnership interest, but for the
application of paragraph (e) (d), clause (4). The lien arises
under section 270.69 from the date of assessment of the tax
against the partner, and attaches to that partner's share of the
profits and any other money due or to become due to that partner
in respect of the partnership. Notice of the lien may be sent
by mail to the partnership, without the necessity for recording
the lien. The notice has the force and effect of a levy under
section 270.70, and is enforceable against the partnership in
the manner provided by that section. Upon payment in full of
the liability subsequent to the notice of lien, the partnership
must be notified that the lien has been satisfied.
Sec. 30. Minnesota Statutes 1989 Supplement, section
290.92, subdivision 4c, is amended to read:
Subd. 4c. [WITHHOLDING BY SMALL BUSINESS CORPORATIONS.]
(a) A corporation having a valid election in effect under
section 290.9725 shall deduct and withhold a tax as provided in
paragraph (b) when it pays or credits amounts to any of its
nonresident individual shareholders as dividends or as their
share of the corporations's undistributed taxable income for the
taxable year.
(b) The amount of tax withheld is determined by multiplying
the amount of dividends or undistributed income allocable to
Minnesota under section 290.17, paid or credited to a
nonresident shareholder during the taxable year by the highest
rate used to determine the income tax liability of an individual
under section 290.06, subdivision 2c, except that the amount of
tax withheld may be determined based on tables provided by the
commissioner if the shareholder submits a withholding exemption
certificate under subdivision 5.
(c) A corporation required to deduct and withhold tax under
this subdivision shall file a return with the commissioner. The
tax required to be deducted and withheld during that year must
be paid with the return. The return and payment is due on or
before the due date specified for filing the corporate income
tax return under section 290.42.
(d) A corporation required to withhold and remit tax under
this section is liable for payment of the tax to the
commissioner, and a person having control of or responsibility
for the withholding of the tax or the filing of returns due
under this subdivision is personally liable for the tax due.
(e) Notwithstanding paragraph (a), a corporation is not
required to deduct and withhold tax for a nonresident
shareholder, if:
(1) the shareholder elects to have the tax due paid as part
of the corporation's composite return under section 290.39,
subdivision 5;
(2) the shareholder has Minnesota assignable federal
adjusted gross income from the corporation of less than $1,000;
or
(3) the corporation is liquidated or terminated, the income
was generated by a transaction related to the termination or
liquidation, and no cash or other property was distributed in
the current or prior taxable year.
(f) (d) For purposes of subdivisions 6, paragraph (1)(c),
subdivision 6a, 7, 11, and 15, and sections 289A.09, subdivision
2, 289A.20, subdivision 2, paragraph (c), 289A.50, 289A.56,
289A.60, and 289A.63, a corporation is considered an employer.
Sec. 31. Minnesota Statutes 1988, section 290.92,
subdivision 6a, is amended to read:
Subd. 6a. [FAILURE TO COMPLY WITH WITHHOLDING PROVISIONS.]
(a) Whenever any When a person who is required to deduct,
withhold, pay over, or deposit any tax imposed by this chapter,
at the time and in the manner prescribed by law or rules fails
to deduct, withhold, or pay over such the tax, or fails to make
deposits or payments of such the tax and is notified of any such
the failure by notice served upon the person in the manner
prescribed for service of a summons in civil actions, then all
the requirements of paragraph (b) shall be complied with met.
In the case of a corporation, partnership or trust, notice
served upon an officer, partner or trustee shall, for purposes
of this subdivision, be deemed to be considered notice served
upon such the corporation, partnership, or trust and all their
officers, partners, or trustees thereof.
(b) Any A person who is required to deduct, withhold, pay
over, or deposit any a tax imposed by this chapter, if notice
has been served upon such that person in accordance with
paragraph (a), shall thereafter after that date deduct, withhold
, and collect such the taxes and shall (not later than the end
of the second banking day after any amount of such taxes is
deducted, withheld or collected) deposit such the taxes in a
separate account in a bank, savings bank or savings and loan
association and shall keep the amount of such the taxes in such
that account until payment over paid to the state of Minnesota.
Any such The account shall constitute constitutes and must be
designated as a special fund in trust for the state of Minnesota
payable to the state of Minnesota by such that person as
trustee. It shall be the duty of such The person upon whom such
notice is served to shall notify the commissioner of revenue in
writing of the name and address of the bank, savings bank or
savings and loan association wherein such the account is kept,
together with such other information as the commissioner may
require. In lieu of the trust fund account, the commissioner
may, when necessary in order to secure the withholding of the
tax imposed by this chapter, require an employer to file with
the department of revenue a bond in an amount determined by the
commissioner, or in lieu thereof of it, security in a form and
in an amount as the commissioner determines, not to exceed more
than twice the estimated average liability for future monthly
withholding tax periods.
(c) The commissioner of revenue, on being satisfied with
respect to any notification made under paragraph (a) of this
subdivision that all the requirements of law and rules with
respect to the taxes imposed by this chapter have been and will
henceforth be complied with, may cancel such the
notification. Such The cancellation shall take effect at such
the time as is specified in the notice of such the
cancellation. All notices authorized or required under this
subdivision shall must be in such the form as the commissioner
may determine determines.
(d) Any person who fails to comply with any provisions of
this subdivision shall, in addition to any other penalties
provided by law, be guilty of a gross misdemeanor, except that
the provisions of this paragraph shall not apply
(1) to any person if such person shows that there was
reasonable doubt as to (a) whether the law required deduction,
withholding or payment of tax or (b) what person was required by
law to deduct, withhold or pay; or
(2) to any person, if such person shows that the failure to
comply with the provisions of paragraph (b) is due to
circumstances beyond the person's control. A lack of funds
existing immediately after the payment of wages (whether or not
created by such payment) shall not be considered to be
circumstances beyond the control of a person.
Sec. 32. Minnesota Statutes 1988, section 290.92,
subdivision 24, is amended to read:
Subd. 24. [APPLICATION FOR ACCOUNT NUMBER.] An employer,
or person withholding tax under section 290.923, desiring to
engage in business in Minnesota shall file with the commissioner
an application for a withholding account number on or before the
due date of the first payment required to be made under the
provisions of subdivision 6. An application for an account
number shall must be made upon a form prescribed by the
commissioner and shall set forth. It must give the name of the
employer or payor, the location of the place or places of
business, the names, addresses and social security numbers of
the owners or partners, or if the employer or payor is a
corporation of the officers, or if the employer or payor is a
trust of the trustees, and such other information as the
commissioner may require. The application shall must be filed
by the owner if the employer or payor is a natural person; by a
member or partner if the employer or payor is an association or
partnership; by a trustee if the employer or payor be a trust,
or by a person authorized to sign the application if the
employer or payor is a corporation.
No fee shall be charged for the application.
The account number is not assignable.
An employer or payor who fails to file an application for a
withholding account number shall be liable to the commissioner
for a penalty of $100. The penalty shall be collected in the
same manner as delinquent withholding tax is collected. The
commissioner may abate this penalty.
Sec. 33. Minnesota Statutes 1989 Supplement, section
290.9201, subdivision 7, is amended to read:
Subd. 7. [WITHHOLDING ON COMPENSATION OF ENTERTAINERS.]
The tax on compensation of an entertainer must be withheld at a
rate of two percent of all compensation paid to the
entertainment entity by the person or corporation having legal
control of the payment of the compensation. The payor is liable
to the state for the payment of the tax required to be deducted
and withheld, and is not liable to a person for the amount of
the payment. The compensation subject to withholding under this
section is not subject to the withholding provisions of section
290.92, subdivision 2a, 3, or 28, except the provisions of
section sections 290.92, subdivisions 6a, 7, 14, 15, and 18,
270.06, paragraph (16), 289A.09, subdivision 2, 289A.60, and
289A.63 shall apply to withholding under this section as if the
withholding were upon wages.
Sec. 34. Minnesota Statutes 1989 Supplement, section
290.9201, subdivision 8, is amended to read:
Subd. 8. [DEPOSIT OF ENTERTAINER WITHHOLDING.] (a) The
person or corporation having legal control of the payment of
compensation taxable under this section shall deposit the
earnings tax with the commissioner, and shall file an
entertainer withholding tax return with the commissioner, within
30 days of each performance.
(b) The withholding tax return must be in the form
prescribed by the commissioner.
Sec. 35. Minnesota Statutes 1989 Supplement, section
290.9705, subdivision 4, is amended to read:
Subd. 4. [DEPOSITS USED AS SURETY FOR COMPLIANCE WITH
INCOME AND SALES TAX PROVISIONS.] The amounts deposited with the
commissioner under subdivisions 2 and 3 subdivision 1 are
considered a surety to guarantee payment of income, franchise,
withholding, and sales and use taxes of the contractor. The
commissioner shall retain the money deposited until the
commissioner determines the contractor's liability for state
income, franchise, sales and use taxes, and taxes withheld under
section 290.92. If the deposit exceeds the liability, the
commissioner shall refund the difference to the contractor with
interest at the rate specified in section 270.76 computed from
the dates the amounts were deposited with the commissioner.
Sec. 36. Minnesota Statutes Second 1989 Supplement,
section 290A.07, subdivision 2a, is amended to read:
Subd. 2a. A claimant who is a renter or a homeowner who
occupies a manufactured home, as defined in section 274.19,
subdivision 8, paragraph (c), shall receive full payment after
August 1 and prior to before August 15 or 60 days after receipt
of the application, whichever is later. Interest shall be added
at the rate specified in section 270.76 from August 15 or 60
days after receipt of the application whichever is later.
Sec. 37. Minnesota Statutes 1988, section 290A.07,
subdivision 3, is amended to read:
Subd. 3. Any A claimant not included in subdivision 2a
shall receive full payment after September 15 and prior to
before September 30. Interest shall be added at the rate
specified in section 270.76 from September 30 or 60 days after
receipt of the application, whichever is later. Interest will
be computed until the date the claim is paid.
Sec. 38. Minnesota Statutes 1988, section 290A.19, is
amended to read:
290A.19 [OWNER OR MANAGING AGENT TO FURNISH RENT
CERTIFICATE; PENALTY.]
(a) The owner or managing agent of any property for which
rent is paid for occupancy as a homestead shall must furnish a
certificate of rent constituting property tax to each a person
who is a renter on December 31, in the form prescribed by the
commissioner. If the renter moves prior to before December 31,
the owner or managing agent has the option to either provide may
give the certificate to the renter at the time of moving, or
mail the certificate to the forwarding address if an address has
been provided by the renter. The certificate shall must be made
available to the renter not later than January 31 before
February 1 of the year following the year in which the rent was
paid.
(b) Any owner or managing agent who willfully fails to
furnish a certificate to the renter and the commissioner as
required by this section is liable to the commissioner for a
penalty of $100 for each act or failure to act. The penalty
shall be assessed and collected in the manner provided in
chapter 290 for the assessment and collection of income tax. If
the owner or managing agent willfully furnishes certificates
that report total rent constituting property taxes in excess of
the amount of actual property taxes paid on the rented part of a
property, as determined under this section, the owner or
managing agent is liable for a penalty equal to the greater of
(1) $100 or (2) 50 percent of the excess that is reported. If
the owner or managing agent reports a total amount of rent
constituting property taxes that exceeds by ten percent or more
the actual property taxes, the report is deemed to be willful.
(c) If the owner or managing agent elects to provide
provides the renter with the certificate at the time of moving,
rather than after December 31, the amount of rent constituting
property taxes shall must be computed as follows:
(i) The net tax shall must be reduced by 1/12 for each
month remaining in the calendar year.
(ii) In calculating the denominator of the fraction
pursuant to under section 290A.03, subdivision 11, the gross
rent paid through the last month of claimant's occupancy shall
must be substituted for "the gross rent paid for the calendar
year for the property in which the unit is located."
(d) (c) The certificate of rent constituting property taxes
shall must include the address of the property, including the
county, and the property tax parcel identification number and
any additional information which that the commissioner
determines is appropriate.
(e) (d) If the owner or managing agent fails to provide the
renter with a certificate of rent constituting property taxes,
the commissioner shall allocate the net tax on the building to
the unit on a square footage basis or other appropriate basis as
the commissioner determines. The renter shall supply the
commissioner with a statement from the county treasurer which
that gives the amount of property tax on the parcel, the address
and property tax parcel identification number of the property,
and the number of units in the building.
(f) The owner or managing agent must file a copy of the
certificate of rent paid with the commissioner before April 15
of the year following the year in which the rent was paid. The
commissioner may require that each owner or managing agent
report on a single form the total property taxes for a property
and the allocation of the property taxes as rent constituting
property taxes among the renters of the property.
Sec. 39. Minnesota Statutes 1988, section 297A.03,
subdivision 2, is amended to read:
Subd. 2. It shall be unlawful for any retailer to
advertise or hold out or state to the public or any customer,
directly or indirectly, that the tax or any part thereof will be
assumed or absorbed by the retailer, or that it will not be
added to the sales price or that, if added, it or any part
thereof will be refunded except that In computing the tax to be
collected as the result of any transaction amounts of tax less
than one-half of one cent may be disregarded and amounts of tax
if of one-half cent or more may be considered an additional cent.
If the sales price of any sale at retail is eight cents or less,
no tax shall be collected. Any person violating this provision
shall be guilty of a misdemeanor.
Sec. 40. Minnesota Statutes 1988, section 297A.041, is
amended to read:
297A.041 [OPERATOR OF FLEA MARKETS; SELLER'S PERMITS
REQUIRED; PENALTY.]
The operator of a flea market, craft show, antique show,
coin show, stamp show, comic book show, convention exhibit area,
or similar selling event, as a prerequisite to renting or
leasing space on the premises owned or controlled by the
operator to a person desiring to engage in or conduct business
as a seller, shall obtain evidence that the seller is the holder
of a valid seller's permit issued pursuant to under section
297A.04, or a written statement from the seller that the seller
is not offering for sale any item that is taxable under this
chapter.
Flea market, craft show, antique show, coin show, stamp
show, comic book show, convention exhibit area, or similar
selling event, as used in this section, means an activity
involving a series of sales sufficient in number, scope, and
character to constitute a regular course of business, and which
that would not qualify as an isolated or occasional sale
pursuant to under section 297A.25, subdivision 12.
Any operator who fails or refuses to comply with the
provisions of this section shall be subject to a penalty payable
to the commissioner of revenue of $100 for each day of each
selling event that the operator fails to obtain evidence that
the seller is the holder of a valid seller's permit issued
pursuant to section 297A.04.
This section does not apply to an operator of a flea
market, craft show, antique show, coin show, stamp show, comic
book show, convention exhibit area, or similar selling event
which that is: (1) held in conjunction with a community
sponsored festival which that has a duration of four or fewer
consecutive days no more than once a year; or (2) conducted by a
nonprofit organization annually or less frequently.
Sec. 41. Minnesota Statutes 1989 Supplement, section
297A.17, is amended to read:
297A.17 [TAX TO BE COLLECTED; STATUS AS DEBT.]
The use tax required to be collected by the retailer
constitutes a debt owed by the retailer to Minnesota and shall
be a debt from the purchaser to the retailer recoverable at law
in the same manner as other debts. A retailer who does not
maintain a place of business within this state, as defined in
section 297A.21, subdivision 1, shall not be indebted to
Minnesota for amounts of use tax which it was required to
collect but did not collect unless the retailer knew or had been
advised by the commissioner of its obligation to collect the use
tax.
Sec. 42. Minnesota Statutes 1988, section 297A.18, is
amended to read:
297A.18 [ADVERTISING NO TAX; MINIMUM TAX.]
It shall be unlawful for any retailer to advertise or hold
out or state to the public or to any customer, directly or
indirectly, that the use tax or any part thereof will be assumed
or absorbed by the retailer, or that it will not be added to the
sales price or that, if added, it or any part thereof will be
refunded except that In computing the tax to be collected as the
result of any transaction amounts of tax less than one-half of
one cent may be disregarded and amounts of tax of one-half cent
or more may be considered an additional cent.
It is unlawful for a person to broadcast or publish, or
arrange to have broadcast or published, an advertisement in a
publication or broadcast media, printed, distributed, broadcast,
or intended to be received in this state, that states that no
sales or use tax is due under this chapter, when the person
knows the advertisement is false.
Sec. 43. Minnesota Statutes 1988, section 297A.211,
subdivision 3, is amended to read:
Subd. 3. Any A person who pays the tax to the seller as
provided in under section 297A.03 or pays the tax to the motor
vehicle registrar as required by section 297B.02 and who meets
the requirements of section 297A.211 at the time of the sale,
except that the person has not registered as a retailer pursuant
to under this section at the time of the sale, may register as a
retailer, make a return, and file for a refund of the difference
between the tax calculated under section 297A.02, 297A.14, or
297B.02 and the tax calculated under subdivision 2. The person
must file for a refund within the time limitations provided in
section 297A.35. Notwithstanding the provisions of section
297A.35, subdivision 1, interest shall be allowed for any refund
allowed under this subdivision only from the date on which the
person has both registered as a retailer and filed a claim for
refund.
Sec. 44. [PURPOSE.]
It is the intent of the legislature to simplify Minnesota's
tax laws by consolidating and recodifying tax administration and
compliance provisions now contained in several chapters of
Minnesota Statutes. Due to the complexity of the
recodification, prior provisions are repealed on the effective
date of the new provisions. The repealed provisions, however,
continue to remain in effect until superseded by the analogous
provision in the new law.
Sec. 45. [REPEALER.]
Minnesota Statutes 1988, sections 270.651; 290.05,
subdivision 5; 290.067, subdivision 5; 290.281, subdivision 5;
290.29; 290.37, as amended by Laws 1989, First Special Session
chapter 1, article 10, section 32; 290.39, as amended by Laws
1989, chapter 335, article 1, section 188; 290.391; 290.40;
290.41; 290.42; 290.43; 290.44; 290.45; 290.46; 290.47; 290.49;
290.50, as amended by Laws 1989, chapter 184, article 2, section
20; 290.521; 290.522; 290.523, as amended by Laws 1989, chapter
184, article 2, section 21; 290.53, subdivisions 1, 1a, 2, 2a,
3, 3a, 4, 7, 8, 9, 10, and 11; 290.54; 290.56; 290.57; 290.58;
290.59; 290.611, subdivision 5; 290.65; 290.92, subdivisions 6,
7, 8, 11, 13, 14, 15, and 18; 290.923, subdivision 7; 290.93;
290.931; 290.932; 290.933; 290.934, as amended by Laws 1989,
First Special Session chapter 1, article 10, section 37;
290.935; 290.936; 290.974; 290A.06; 290A.11, subdivisions 1, 2,
3, and 4; 290A.111; 290A.112, as amended by Laws 1989, chapter
184, article 2, section 26; 290A.12; 291.09; 291.11; 291.131;
291.14; 291.15, subdivisions 1 and 3; 291.215, subdivisions 2
and 3; 291.31, subdivision 1; 291.32; 297A.08; 297A.121;
297A.15, subdivision 3; 297A.26, subdivisions 1 and 4; 297A.27;
297A.275; 297A.30; 297A.31; 297A.32; 297A.33, subdivisions 1, 3,
4, and 5; 297A.34; 297A.35; 297A.39, subdivisions 1, 2, 2a, 3,
4, 7, and 8; 297A.40; 297A.41; 297A.42; and 297A.44, subdivision
2, are repealed. Minnesota Statutes 1989 Supplement, sections
290.9201, subdivisions 4, 5, 9, and 10; 290.9705, subdivision 2;
290A.11, subdivision 1a; and 297A.20, are repealed. Minnesota
Statutes Second 1989 Supplement, sections 270.77 and 290.38 are
repealed. Minnesota Rules, parts 8052.0100, 8052.0200, and
8130.7800, are repealed.
Sec. 46. [INSTRUCTIONS TO REVISOR.]
(a) If a provision of a section of Minnesota Statutes
repealed or amended by this article is amended by the 1990
regular session, the revisor shall codify the amendment
consistent with the recodification of the affected section by
this act, notwithstanding any law to the contrary.
(b) In the next edition of Minnesota Statutes, in the
sections referred to in column A, the revisor of statutes shall
delete the reference in column B and insert the reference in
column C. The revisor may change the references in column C to
the sections of Minnesota Statutes in which the bill sections
are compiled.
Column A Column B Column C
60A.15, subd. 6 290.53, subd. 1 289A.60, subd. 1
60A.15, subd. 9a 290.53, subd. 2 289A.60, subd. 2
60A.15, subd. 9b 290.53, subd. 3a 289A.60, subd. 6
60A.15, subd. 9c 290.53, subd. 3 289A.60, subd. 5
60A.15, subd. 9d 290.53, subd. 4 289A.63,
subds. 1 and 3
60A.199, subd. 4 290.53, subd. 2 289A.60, subd. 2
60A.199, subd. 5 290.53, subd. 3a 289A.60, subd. 6
60A.199, subd. 6 290.53, subd. 3 289A.60, subd. 5
69.59 290.53 289A.60
115B.24, subd. 4 290.936 289A.50
270.10, subd. 1 290.42, clause (6) 289A.19,
subds. 1 and 2
270A.07, subd. 5 290.92, subd. 13, 289A.56, subd. 2
clause (1)
290.01, subd. 10 290.40(2) 289A.08, subd. 5
290.05, subd. 4 290.56 289A.38,
subds. 8 and 9
290.095, subd. 7 290.37, subd. 1 289A.08, subd. 9
290.095, subd. 9 290.46 289A.40
290.095, subd. 9 290.50 289A.50
290.30 290.29 289A.31, subd. 3
290.371, subd. 2 290.37 289A.08
290.923, subd. 3 290.92, subd. 6 289A.09 and
289A.20, subd. 2
290.923, subd. 4 290.92, subd. 7 289A.09, subd. 2
290A.24 290.93 289A.25
291.09, subd. 3a 291.11 289A.42, subd. 1
297.09, subd. 1 Minnesota Statutes 270.06
1945, 290.56 to
290.58
297.37, subd. 1 290.56 to 290.58 270.06
297A.04 297A.27, subd. 2 289A.11, subd. 3
297A.15, subd. 5 297A.34 289A.40
297A.211, subd. 2 297A.26 and 289A.20, subd. 4
297A.27 and 289A.11
297A.211, subd. 3 297A.35 289A.40
299F.21, subd. 2 290.53, subd. 1 289A.60, subd. 1
299F.23, subd. 2 290.53, subd. 2 289A.60, subd. 2
299F.23, subd. 3 290.53, subd. 3a 289A.60, subd. 6
299F.23, subd. 4 290.53, subd. 3 289A.60, subd. 5
302A.821, subd. 1 290.37 289A.08
302A.821, subd. 1 290.974 289A.12, subd. 3
349.2121, subd. 6 297A.39 289A.60
356.62 290.41 289A.12
356.62 290.42 289A.12
388.051, subd. 2 290.53, subds. 4 289A.63, subds. 1,
and 11 2, 4, and 6
290.92, subd. 15
290A.11, subd. 2
297A.08
297A.39, subds. 4
and 8
469.171, subd. 10 290.50 289A.50
588.21 290.39, subd. 1 289A.36, subd. 3
Sec. 47. [EFFECTIVE DATES.]
Sections 1, 2, and 44 are effective the day following final
enactment.
Sections 15 and 16 are effective for audits or
investigations initiated on or after August 1, 1990.
Section 17 is effective for assessments or other
determinations made on or after August 1, 1990.
Section 18 is effective for returns becoming due on or
after August 1, 1990.
Sections 20 and 23 are effective for overpayments of taxes
or other payments first becoming due on or after August 1, 1990.
Section 24 is effective for interest on amounts first
becoming due to the commissioner on or after August 1, 1990.
Sections 3 to 14 and 25 are effective for returns, reports,
taxes, or other payments first becoming due on or after August
1, 1990, except that the exclusion for foreign operating
corporations from the filing requirements in section 3 is
effective on the effective date of Minnesota Statutes, section
290.01, subdivision 6b.
Section 26 is effective for payments, returns, reports, or
other documents first becoming due, or acts committed, on or
after August 1, 1990.
Section 27 is effective for crimes committed on or after
August 1, 1990.
Sections 19, 21, 22, 28 to 43, and 45 are effective August
1, 1990.
ARTICLE 2
COLLECTIONS
Section 1. Minnesota Statutes 1989 Supplement, section
270.06, is amended to read:
270.06 [POWERS AND DUTIES.]
The commissioner of revenue shall:
(1) have and exercise general supervision over the
administration of the assessment and taxation laws of the state,
over assessors, town, county, and city boards of review and
equalization, and all other assessing officers in the
performance of their duties, to the end that all assessments of
property be made relatively just and equal in compliance with
the laws of the state;
(2) confer with, advise, and give the necessary
instructions and directions to local assessors and local boards
of review throughout the state as to their duties under the laws
of the state;
(3) direct proceedings, actions, and prosecutions to be
instituted to enforce the laws relating to the liability and
punishment of public officers and officers and agents of
corporations for failure or negligence to comply with the
provisions of the laws of this state governing returns of
assessment and taxation of property, and cause complaints to be
made against local assessors, members of boards of equalization,
members of boards of review, or any other assessing or taxing
officer, to the proper authority, for their removal from office
for misconduct or negligence of duty;
(4) require county attorneys to assist in the commencement
of prosecutions in actions or proceedings for removal,
forfeiture and punishment for violation of the laws of this
state in respect to the assessment and taxation of property in
their respective districts or counties;
(5) require town, city, county, and other public officers
to report information as to the assessment of property,
collection of taxes received from licenses and other sources,
and such other information as may be needful in the work of the
department of revenue, in such form and upon such blanks as the
commissioner may prescribe;
(6) require individuals, copartnerships, companies,
associations, and corporations to furnish information concerning
their capital, funded or other debt, current assets and
liabilities, earnings, operating expenses, taxes, as well as all
other statements now required by law for taxation purposes;
(7) summon witnesses, at a time and place reasonable under
the circumstances, to appear and give testimony, and to produce
books, records, papers and documents relating to any tax matter
which the commissioner may have authority to investigate or
determine. Provided, that any summons which does not identify
the person or persons with respect to whose tax liability the
summons is issued may be served only if (a) the summons relates
to the investigation of a particular person or ascertainable
group or class of persons, (b) there is a reasonable basis for
believing that such person or group or class of persons may fail
or may have failed to comply with any tax law administered by
the commissioner, (c) the information sought to be obtained from
the examination of the records (and the identity of the person
or persons with respect to whose liability the summons is
issued) is not readily available from other sources, (d) the
summons is clear and specific as to the information sought to be
obtained, and (e) the information sought to be obtained is
limited solely to the scope of the investigation. Provided
further that the party served with a summons which does not
identify the person or persons with respect to whose tax
liability the summons is issued shall have the right, within 20
days after service of the summons, to petition the district
court for the judicial district in which lies the county in
which that party is located for a determination as to whether
the commissioner of revenue has complied with all the
requirements in (a) to (e), and thus, whether the summons is
enforceable. If no such petition is made by the party served
within the time prescribed, the summons shall have the force and
effect of a court order;
(8) cause the deposition of witnesses residing within or
without the state, or absent therefrom, to be taken, upon notice
to the interested party, if any, in like manner that depositions
of witnesses are taken in civil actions in the district court,
in any matter which the commissioner may have authority to
investigate or determine;
(9) investigate the tax laws of other states and countries
and to formulate and submit to the legislature such legislation
as the commissioner may deem expedient to prevent evasions of
assessment and taxing laws, and secure just and equal taxation
and improvement in the system of assessment and taxation in this
state;
(10) consult and confer with the governor upon the subject
of taxation, the administration of the laws in regard thereto,
and the progress of the work of the department of revenue, and
furnish the governor, from time to time, such assistance and
information as the governor may require relating to tax matters;
(11) transmit to the governor, on or before the third
Monday in December of each even-numbered year, and to each
member of the legislature, on or before November 15 of each even
numbered year, the report of the department of revenue for the
preceding years, showing all the taxable property in the state
and the value of the same, in tabulated form;
(12) inquire into the methods of assessment and taxation
and ascertain whether the assessors faithfully discharge their
duties, particularly as to their compliance with the laws
requiring the assessment of all property not exempt from
taxation;
(13) exercise and perform such further powers and duties as
may be required or imposed upon the commissioner of revenue by
law; administer and enforce the assessment and collection of
state taxes and, from time to time, make, publish, and
distribute rules for the administration and enforcement of state
tax laws. The rules have the force of law;
(14) promulgate rules having the force and effect of law,
for the administration and enforcement of the property
tax; prepare blank forms for the returns required by state tax
law and distribute them throughout the state, furnishing them
subject to charge on application;
(15) execute and administer any agreement with the
secretary of the treasury of the United States regarding the
exchange of information and administration of the tax laws of
both the United States and the state of Minnesota; prescribe
rules governing the qualification and practice of agents,
attorneys, or other persons representing taxpayers before the
commissioner. The rules may require that those persons, agents,
and attorneys show that they are of good character and in good
repute, have the necessary qualifications to give taxpayers
valuable services, and are otherwise competent to advise and
assist taxpayers in the presentation of their case before being
recognized as representatives of taxpayers. After due notice
and opportunity for hearing, the commissioner may suspend and
disbar from further practice before the commissioner any person,
agent, or attorney who is shown to be incompetent or
disreputable, who refuses to comply with the rules, or who with
intent to defraud, willfully or knowingly deceives, misleads, or
threatens a taxpayer or prospective taxpayer, by words,
circular, letter, or by advertisement. This clause does not
curtail the rights of individuals to appear in their own behalf
or partners or corporations' officers to appear in behalf of
their respective partnerships or corporations;
(16) appoint agents as the commissioner considers necessary
to make examinations and determinations. The agents have the
rights and powers conferred on the commissioner to examine
books, records, papers, or memoranda, subpoena witnesses,
administer oaths and affirmations, and take testimony. Upon
demand of an agent, the clerk or court administrator of any
court shall issue a subpoena for the attendance of a witness or
the production of books, papers, records, or memoranda before
the agent. The commissioner may also issue subpoenas.
Disobedience of subpoenas issued under this chapter shall be
punished by the district court of the district in which the
subpoena is issued, or in the case of a subpoena issued by the
commissioner, by the district court of the district in which the
party served with the subpoena is located, in the same manner as
contempt of the district court;
(17) appoint and employ additional help, purchase supplies
or materials, or incur other expenditures in the enforcement of
state tax laws as considered necessary. The salaries of all
agents and employees provided for in this chapter shall be fixed
by the appointing authority, subject to the approval of the
commissioner of administration;
(18) execute and administer any agreement with the
secretary of the treasury of the United States or a
representative of another state regarding the exchange of
information and administration of the tax laws;
(16) (19) administer and enforce the provisions of sections
325D.30 to 325D.42, the Minnesota unfair cigarette sales
act; and
(17) (20) authorize the use of unmarked motor vehicles to
conduct seizures or criminal investigations pursuant to the
commissioner's authority.; and
(21) exercise other powers and perform other duties
required of or imposed upon the commissioner of revenue by law.
Sec. 2. [270.101] [PERSONAL LIABILITY.]
Subdivision 1. [LIABILITY IMPOSED.] A person who, either
singly or jointly with others, has the control of, supervision
of, or responsibility for filing returns or reports, paying
taxes, or collecting or withholding and remitting taxes and who
fails to do so, or a person who is liable under any other law,
is liable for the payment of taxes, penalties, and interest
arising under chapters 296, 297, 297A, and 297C, or sections
290.92, 349.212, and 349.2121.
Subd. 2. [PERSON DEFINED.] The term "person" includes, but
is not limited to, a corporation, estate, trust, organization,
or association, whether organized for profit or not, an officer
or director of a corporation, a member of a partnership, an
employee, a third party (including, but not limited to, a
financial institution, lender, or surety), and any other
individual or entity.
Subd. 3. [PROCEDURE FOR ASSESSMENT.] The commissioner may
assess liability for the taxes described in subdivision 1
against a person liable under this section. The assessment may
be based upon information available to the commissioner. It
must be made within the prescribed period of limitations for
assessing the underlying tax. An order assessing personal
liability under this section is reviewable under section 289A.65
and is appealable to tax court.
Sec. 3. Minnesota Statutes 1988, section 270.65, is
amended to read:
270.65 [DATE OF ASSESSMENT; DEFINITION.]
For purposes of this chapter and chapters 290, 296, and
297A, taxes administered by the commissioner, the term "date of
assessment" means the date a return was filed or the date a
return should have been filed, whichever is later; or, in the
case of taxes determined by the commissioner, "date of
assessment" means the date of the order assessing taxes; or, in
the case of an amended return filed by the taxpayer, the
assessment date is the date the return was filed with the
commissioner.
Sec. 4. [270.652] [ALLOCATION OF PAYMENT.]
In the discretion of the commissioner of revenue, payments
received for taxes may be credited first to the oldest liability
not secured by a judgment or lien. For liabilities to which
payments are applied, the commissioner may credit payments first
to penalties, next to interest, and then to the tax due.
Sec. 5. Minnesota Statutes 1988, section 270.67,
subdivision 1, is amended to read:
Subdivision 1. [LIABILITY AGREEMENTS.] The commissioner of
revenue, or any officer or employee of the department of revenue
authorized in writing by the commissioner, is authorized to
enter into an agreement in writing with any taxpayer, or duly
authorized agent or representative of the taxpayer, relating to
the liability of the taxpayer in respect of any state tax
administered by the commissioner for any taxable period ending
prior to the date of the agreement. If the agreement is
approved by the commissioner within the time stated in the
agreement, or later agreed to, The agreement shall be final and
conclusive; and, except upon a showing of fraud or malfeasance,
or misrepresentation of a material fact, the case shall not be
reopened as to the matters agreed upon, or the agreement
modified, by any officer, employee, or agent of the state; and,
in any suit, action, or proceeding, the agreement, or any
determination, assessment, collection, payment, abatement,
refund, or credit made in accordance with the agreement, shall
not be annulled, modified, set aside, or disregarded.
Sec. 6. Minnesota Statutes 1988, section 270.67,
subdivision 2, is amended to read:
Subd. 2. [EXTENSION AGREEMENTS.] When any portion of any
tax payable to the commissioner of revenue together with
interest and penalty thereon, if any, has not been paid six
months from the date prescribed by law for its payment, the
commissioner may extend the time for payment for a further
period not to exceed 36 months. When the authority of this
section is invoked, the extension shall be evidenced by written
agreement signed by the taxpayer and the commissioner, stating
the amount of the tax with penalty and interest, if any, and
providing for the payment of the amount in regular weekly,
semimonthly or monthly installments. The agreement shall
contain a confession of judgment for the amount and for any
unpaid portion thereof and shall provide that the commissioner
may forthwith enter judgment against the taxpayer in the
district court of the county of residence as shown upon the
taxpayer's tax return for the unpaid portion of the amount
specified in the extension agreement. The commissioner may
accept other collateral the commissioner considers appropriate
to secure satisfaction of the tax liability. The principal sum
specified in the agreement shall bear interest at the rate
specified in section 270.75 on all unpaid portions thereof until
the same has been fully paid or the unpaid portion thereof has
been entered as a judgment. The judgment shall bear interest at
the rate specified in section 270.75. If it appears to the
commissioner that the tax reported by the taxpayer is in excess
of the amount actually owing by the taxpayer, the extension
agreement or the judgment entered pursuant thereto shall be
corrected. If after making the extension agreement or entering
judgment with respect thereto, the commissioner determines that
the tax as reported by the taxpayer is less than the amount
actually due, the commissioner shall assess a further tax in
accordance with the provisions of law applicable to the tax.
The authority granted to the commissioner by this section is in
addition to any other authority granted to the commissioner by
law to extend the time of payment or the time for filing a
return and shall not be construed in limitation thereof.
Sec. 7. Minnesota Statutes 1988, section 270.68,
subdivision 1, is amended to read:
Subdivision 1. [LEGAL ACTION.] In addition to all other
methods authorized by law for the collection of tax, if any tax
payable to the commissioner of revenue or to the department of
revenue, including penalties and interest thereon, is not paid
within 60 days after it is required by law to be paid, the
commissioner of revenue may, proceed under this subdivision.
Within five years after the date of assessment of the tax, or,
if the action is to renew a judgment, at any time before the
judgment's expiration, the commissioner may bring an action at
law against the person liable for the payment or collection of
the tax, in the name of the state, for the recovery of the tax
and interest and penalties due in respect thereof. The action
shall be brought in the district court of the judicial district
in which lies the county of the residence or principal place of
business within this state of the taxpayer, or, in the case of
an estate or trust, of the place of its principal
administration, and for this purpose the place named as such in
the return, if any, made by the taxpayer shall be conclusive
against the taxpayer in this matter. If no place is named in
the return, the action may be commenced in Ramsey county. The
action shall be commenced by filing with the court administrator
a statement showing the name and address of the taxpayer, if
known, an itemized summary of the taxable periods and the type
of tax, the tax due and unpaid and the interest and penalties
due with respect thereto under the provisions of law applicable
to the tax, and shall contain a prayer that the court adjudge
the taxpayer to be indebted on account of the taxes, interest,
and penalties in the amount specified in the statement; a copy
of the statement shall be furnished to the court administrator
therewith. The court administrator shall mail a copy of the
statement by certified mail to the taxpayer at the address given
in the return, if any; and, if no address is given, then at to
the taxpayer's last known address, within five days after the
same is filed, except that, if the taxpayer's address is not
known, notice shall be made by posting a copy of the statement
for ten days in the place in the courthouse where public notices
are regularly posted. To litigate the claim, or any
part thereof of it, the taxpayer shall file a verified serve an
answer with the court administrator setting forth objections to
the claim, or any part thereof; the answer shall be filed upon
the commissioner on or before the 20th day after the date of
mailing the statement; or, if notice has been given by posting,
on or before the 20th day after the expiration of the period
during which the notice was required to be posted. If no answer
is filed served within the specified time, the court
administrator, upon the filing of an affidavit of default, shall
enter judgment for the state in the amount prayed for, plus
costs of $10. If an answer is filed, the issues raised shall
stand for trial as soon as possible after the filing of the
answer, and the court shall determine the issues and direct
judgment accordingly; and, if the taxes, interest, or penalties
are sustained to any extent over the amount rendered by the
taxpayer, shall assess $10 costs against the taxpayer. The
court shall disregard all technicalities and matters of form not
affecting the substantial merits. The commissioner may call
upon the county attorney or the attorney general to conduct the
proceedings on behalf of the state. Execution shall be issued
upon the judgment at the request of the commissioner, and the
execution shall, in all other respects, be governed by the laws
applicable to executions issued on judgments. Only the
homestead and household goods of the judgment debtor shall be
exempt from seizure and sale upon the execution.
Sec. 8. Minnesota Statutes 1988, section 270.68,
subdivision 3, is amended to read:
Subd. 3. [TAX PRESUMED VALID.] The tax, as assessed by the
commissioner, with any penalties included therein, shall be
presumed to be valid and correctly determined and assessed, and
the burden shall be upon the taxpayer to show its incorrectness
or invalidity. The A statement filed by the commissioner with
the court administrator, as provided in subdivision 1, or any
other certificate by the commissioner of showing the amount of
the tax and penalties as determined or assessed by the
commissioner, shall be is admissible in evidence and shall
establish prima facie the facts set forth therein.
Sec. 9. Minnesota Statutes 1988, section 270.69,
subdivision 2, is amended to read:
Subd. 2. [FILING OF LIENS NECESSARY FOR ENFORCEABILITY
AGAINST CERTAIN PERSONS.] The lien imposed by subdivision 1 is
not enforceable against any purchaser, mortgagee, pledgee,
holder of a uniform commercial code security interest,
mechanic's lienor, or judgment lien creditor whose interest has
been duly perfected or is entitled to protection under
applicable provisions of state law, until a notice of lien has
been filed by the commissioner of revenue in the office of the
county recorder of the county in which the real property is
situated, or in the case of personal property belonging to an
individual who is not a resident of this state, or which is to a
corporation, partnership, or other organization, in the office
of the secretary of state, or in the case of personal property
belonging to a resident individual, in the office of the county
recorder of the county of residence of the individual.
Notwithstanding any other law to the contrary, the department of
revenue is exempt from the payment of fees at the time the lien
is offered for filing or recording. The fee for filing or
recording the lien must be paid at the time the release of lien
is offered for filing or recording. Notwithstanding any law to
the contrary, the fee for filing or recording the lien or the
release of lien is $15.
Sec. 10. Minnesota Statutes 1988, section 270.69,
subdivision 3, is amended to read:
Subd. 3. [EXEMPT PROPERTY.] The lien imposed on personal
property by this section, even though properly filed, is not
enforceable: (1) against a purchaser with respect to tangible
personal property purchased at retail, in the ordinary course of
the seller's trade or business, unless at the time of purchase
the purchaser intends the purchase to or knows the purchase will
hinder, evade, or defeat the collection of a tax; or (2) against
the personal property listed as exempt in sections 550.37,
550.38, and 550.39.
Sec. 11. Minnesota Statutes 1988, section 270.69,
subdivision 7, is amended to read:
Subd. 7. [NOTICE OF MORTGAGE FORECLOSURE OR CONTRACT
TERMINATION.] If a lien has been filed by the commissioner of
revenue against real property pursuant to this section, and,
subsequent to the recording of the lien, In the case of a
mortgage foreclosure upon the real property is commenced under
chapter 580, or a termination of contract of sale of the real
property is commenced under section 559.21, if the commissioner
has filed a lien under this section before the foreclosure sale
or date of termination, notice of the mortgage foreclosure or
termination of contract of sale shall be mailed to the
commissioner not less than 25 days prior to the foreclosure sale
or date of termination. Provided, notice need not be given
pursuant to this subdivision if the lien of the commissioner has
been filed within 30 days or less prior to the foreclosure sale
or date of termination. The contents of the notice shall be as
prescribed in section 7425(c)(1) of the Internal Revenue Code of
1954, as amended through December 31, 1982. must contain the
following information: (1) the name and address of the
taxpayer; (2) a copy of the notice of mortgage foreclosure or
contract for deed cancellation; (3) a copy of the lien filed by
the commissioner; (4) the total unpaid balance of the mortgage
or contract for deed; (5) a legal description of the property;
and (6) the fair market value of the property.
Sec. 12. Minnesota Statutes 1988, section 270.69,
subdivision 8, is amended to read:
Subd. 8. [FILING ENTITLEMENT.] Execution of notices of
liens or of other notices affecting state tax liens by the
original or facsimile signature of the commissioner of revenue
or a delegate entitles them to be filed, and no other
attestation, certification, or acknowledgment is necessary.
Sec. 13. Minnesota Statutes 1988, section 270.69, is
amended by adding a subdivision to read:
Subd. 12. [LIEN RELEASE FEE.] A fee of $25 must be paid to
the commissioner of revenue for each duplicate of an original
release of lien.
Sec. 14. Minnesota Statutes 1988, section 270.70,
subdivision 1, is amended to read:
Subdivision 1. [AUTHORITY OF COMMISSIONER.] If any tax
payable to the commissioner of revenue or to the department of
revenue is not paid when due, such tax may be collected by the
commissioner of revenue within five years after the date of
assessment of the tax, or if a lien has been filed, during the
period the lien is enforceable, or if the tax judgment has been
filed, within the statutory period of enforcement of a valid tax
judgment, by a levy upon all property and rights to property,
including any property in the possession of law enforcement
officials, of the person liable for the payment or collection of
such tax (except that which is exempt from execution pursuant to
section 550.37) or property on which there is a lien provided in
section 270.69. For this purpose, the term "tax" shall include
any penalty, interest and costs properly payable. The term
"levy" includes the power of distraint and seizure by any means.
Sec. 15. Minnesota Statutes 1989 Supplement, section
270.73, subdivision 1, is amended to read:
Subdivision 1. [POSTING, NOTICE.] Pursuant to section
270B.12, subdivision 4, the commissioner shall, by the 15th of
each month, submit to the commissioner of public safety a list
of all taxpayers who are required to withhold or collect the tax
imposed by section 290.92 or 297A.02, or local sales and use tax
payable to the commissioner of revenue, and who are 30 days or
more delinquent in either filing a tax return or paying the
tax. At least ten days before notifying the commissioner of
public safety, the commissioner of revenue shall notify the
taxpayer of the intended action.
The commissioner of public safety shall post the list in
the same manner as provided in section 340A.318, subdivision 3.
The list will prominently show the date of posting. If a
taxpayer previously listed cures the delinquency by filing all
returns and paying all taxes, the commissioner shall notify the
commissioner of public safety within two business days that the
delinquency was cured.
Sec. 16. Minnesota Statutes 1988, section 290.92,
subdivision 23, is amended to read:
Subd. 23. [WITHHOLDING BY EMPLOYER OF DELINQUENT TAXES.]
(1) The commissioner may, within five years after the date of
assessment of the tax, or if a lien has been filed under section
270.69, within the statutory period for enforcement of the lien,
give notice to any employer deriving income which has a taxable
situs in this state regardless of whether the income is exempt
from taxation, that an employee of that employer is delinquent
in a certain amount with respect to any state taxes, including
penalties, interest and costs. The commissioner can proceed
under this subdivision only if the tax is uncontested or if the
time for appeal of the tax has expired. The commissioner shall
not proceed under this subdivision until the expiration of 30
days after mailing to the taxpayer, at the taxpayer's last known
address, a written notice of (a) the amount of taxes, interest,
and penalties due from the taxpayer and demand for their
payment, and (b) the commissioner's intention to require
additional withholding by the taxpayer's employer pursuant to
this subdivision. The effect of the notice shall expire 180
days after it has been mailed to the taxpayer provided that the
notice may be renewed by mailing a new notice which is in
accordance with this subdivision. The renewed notice shall have
the effect of reinstating the priority of the original claim.
The notice to the taxpayer shall be in substantially the same
form as that provided in section 571.41. The notice shall
further inform the taxpayer of the wage exemptions contained in
section 550.37, subdivision 14. If no statement of exemption is
received by the commissioner within 30 days from the mailing of
the notice, the commissioner may proceed under this
subdivision. The notice to the taxpayer's employer may be
served by mail or by delivery by an employee of the department
of revenue and shall be in substantially the same form as
provided in section 571.495. Upon receipt of notice, the
employer shall withhold from compensation due or to become due
to the employee, the total amount shown by the notice, subject
to the provisions of section 571.55. The employer shall
continue to withhold each pay period until the total amount
shown by the notice is paid in full released by the commissioner
under section 270.709. Upon receipt of notice by the employer,
the claim of the state of Minnesota shall have priority over any
subsequent garnishments or wage assignments. The commissioner
may arrange between the employer and the employee for
withholding a portion of the total amount due the employee each
pay period, until the total amount shown by the notice plus
accrued interest has been withheld.
The "compensation due" any employee is defined in
accordance with the provisions of section 571.55. The maximum
withholding allowed under this subdivision for any one pay
period shall be decreased by any amounts payable pursuant to a
garnishment action with respect to which the employer was served
prior to being served with the notice of delinquency and any
amounts covered by any irrevocable and previously effective
assignment of wages; the employer shall give notice to the
department of the amounts and the facts relating to such
assignments within ten days after the service of the notice of
delinquency on the form provided by the department of revenue as
noted in this subdivision. In crediting amounts withheld
against delinquent taxes of an employee, the department shall
apply amounts withheld in the following order: penalties,
interest, tax and costs.
(2) If the employee ceases to be employed by the employer
before the full amount set forth in a notice of delinquency plus
accrued interest has been withheld, the employer shall
immediately notify the commissioner in writing of the
termination date of the employee and the total amount withheld.
No employer may discharge any employee by reason of the fact
that the commissioner has proceeded under this subdivision. If
an employer discharges an employee in violation of this
provision, the employee shall have the same remedy as provided
in section 571.61, subdivision 2.
(3) Within ten days after the expiration of such pay
period, the employer shall, by the date prescribed in
subdivision 6, remit to the commissioner, on a form and in the
manner prescribed by the commissioner, the amount withheld
during the calendar quarter each pay period under this
subdivision. Should any employer, after notice, willfully fail
to withhold in accordance with the notice and this subdivision,
or willfully fail to remit any amount withheld as required by
this subdivision, the employer shall be liable for the total
amount set forth in the notice together with accrued interest
which may be collected by any means provided by law relating to
taxation. No amount required to be paid by an employer by
reason of the employer's failure to remit under this
subdivision, may be deducted from the gross income of the
employer, under sections 290.09, subdivision 4 or 290.01,
subdivisions 20 to 20f. Any amount collected from the employer
for failure to withhold or for failure to remit under this
subdivision shall be credited to the employee's account in the
following manner: penalties, interest, tax and costs.
(4) Clauses (1), (2) and (3), except provisions imposing a
liability on the employer for failure to withhold or remit,
shall apply to cases in which the employer is the United States
or any instrumentality thereof or this state or any municipality
or other subordinate unit thereof.
(5) The commissioner shall refund to the employee excess
amounts withheld from the employee under this subdivision. If
any excess results from payments by the employer because of
willful failure to withhold or remit as prescribed in clause (3)
above, the excess attributable to the employer's payment shall
be refunded to the employer.
(6) Employers required to withhold delinquent taxes,
penalties, interest and costs under this subdivision shall not
be required to compute any additional interest, costs or other
charges to be withheld.
(7) The collection remedy provided to the commissioner by
this subdivision shall have the same legal effect as if it were
a levy made pursuant to section 270.70.
Sec. 17. Minnesota Statutes 1988, section 524.3-1001, is
amended to read:
524.3-1001 [FORMAL PROCEEDINGS TERMINATING ADMINISTRATION;
TESTATE OR INTESTATE; ORDER OF DISTRIBUTION, DECREE, AND GENERAL
PROTECTION.]
(a) (1) A personal representative or any interested person
may petition for an order of complete settlement of the estate.
The personal representative may petition at any time, and any
other interested person may petition after one year from the
appointment of the original personal representative except that
no petition under this section may be entertained until the time
for presenting claims which arose prior to the death of the
decedent has expired. The petition may request the court to
determine testacy, if not previously determined, to consider the
final account or compel or approve an accounting and
distribution, to construe any will or determine heirs and
adjudicate the final settlement and distribution of the estate.
After notice to all interested persons and hearing the court may
enter an order or orders, on appropriate conditions, determining
the persons entitled to distribution of the estate, and, as
circumstances require, approving settlement and directing or
approving distribution of the estate and discharging the
personal representative from further claim or demand of any
interested person.
(2) In such petition for complete settlement of the estate,
the petitioner may apply for a decree. Upon the hearing, if in
the best interests of interested persons, the court may issue
its decree which shall determine the persons entitled to the
estate and assign the same to them in lieu of ordering the
assignment by the personal representative. The decree shall
name the heirs and distributees, state their relationship to the
decedent, describe the property, and state the proportions or
part thereof to which each is entitled. In the estate of a
testate decedent, no heirs shall be named in the decree unless
all heirs be ascertained.
(3) In solvent estates, the hearing may be waived by
written consent to the proposed account and decree of
distribution or order of distribution by all heirs or
distributees, and the court may then enter its order allowing
the account and issue its decree or order of distribution.
(4) Where a decree or order for distribution is issued, the
personal representative shall not be discharged until all
property is paid or transferred to the persons entitled thereto,
and the personal representative has otherwise fully discharged
the trust. If objections are an order assessing estate tax or
request for documents is filed with the court by the
commissioner of revenue, no discharge shall be issued until the
objections are determined assessment is paid or the request is
complied with. If no objection order assessing estate tax or
request for documents is filed, the court shall have the power
to settle and distribute the estate and discharge the personal
representative without regard to tax obligations.
(b) If one or more heirs or devisees were omitted as
parties in, or were not given notice of, a previous formal
testacy proceeding, the court, on proper petition for an order
of complete settlement of the estate under this section, and
after notice to the omitted or unnotified persons and other
interested parties determined to be interested on the assumption
that the previous order concerning testacy is conclusive as to
those given notice of the earlier proceeding, may determine
testacy as it affects the omitted persons and confirm or alter
the previous order of testacy as it affects all interested
persons as appropriate in the light of the new proofs. In the
absence of objection by an omitted or unnotified person,
evidence received in the original testacy proceeding shall
constitute prima facie proof of due execution of any will
previously admitted to probate, or of the fact that the decedent
left no valid will if the prior proceedings determined this fact.
Sec. 18. [REPEALER.]
(a) Minnesota Statutes 1988, section 270.10, subdivision 4,
is repealed.
(b) Minnesota Statutes 1988, section 270.08 is repealed.
(c) Minnesota Statutes 1988, sections 290.53, subdivision 5
and 297A.39, subdivision 5, are repealed.
(d) Minnesota Statutes 1988, sections 290.52; 291.31,
subdivision 2; 297A.29; and 297A.37, are repealed.
Sec. 19. [EFFECTIVE DATES.]
Sections 1, 3, 13, 15, 16, 17, and 18, paragraph (d), are
effective August 1, 1990.
Sections 5, 6, 7, 8, 14, and 18, paragraph (b), are
effective the day following final enactment.
Sections 9 and 10 are effective for liens imposed on or
after August 1, 1990.
Section 11 is effective for mortgage foreclosures or
terminations of contracts of sale of real property commenced
after August 1, 1990.
Section 12 is effective for notices executed on or after
August 1, 1990.
Sections 4 and 18, paragraph (c), are effective for
payments received on or after August 1, 1990.
Sections 2 and 18, paragraph (a), are effective for taxes
becoming due on or after August 1, 1990.
ARTICLE 3
GASOLINE AND SPECIAL FUEL TAXES
Section 1. Minnesota Statutes 1988, section 296.18,
subdivision 2, is amended to read:
Subd. 2. [FAILURE TO USE OR SELL GASOLINE OR SPECIAL FUEL
FOR INTENDED PURPOSES; REPORTS REQUIRED.] (1) Any person who
shall buy aviation gasoline or special fuel for aircraft use and
who shall have paid the excise taxes due thereon directly or
indirectly through the amount of the tax being included in the
price thereof, or otherwise, and shall use said gasoline or
special fuel in motor vehicles or shall knowingly sell it to any
person for use in motor vehicles shall, on or before the
twenty-third day of the month following that in which such
gasoline or special fuel was so used or sold, report the fact of
such use or sale to the commissioner in such form as the
commissioner may prescribe.
(2) Any person who shall buy gasoline other than aviation
gasoline and who shall have paid the motor vehicle gasoline
excise tax directly or indirectly through the amount of the tax
being included in the price of the gasoline, or otherwise, who
shall knowingly sell such gasoline to any person to be used for
the purpose of producing or generating power for propelling
aircraft, or who shall receive, store, or withdraw from storage
such gasoline to be used for that purpose, shall, on or before
the 23rd day of the month following that in which such gasoline
was so sold, stored, or withdrawn from storage, report the fact
of such sale, storage, or withdrawal from storage to the
commissioner in such form as the commissioner may prescribe.
(3) Any person who shall buy aviation gasoline or special
fuel for aircraft use and who shall have paid the excise taxes
directly or indirectly through the amount of the tax being
included in the price thereof, or otherwise, who shall not use
it in motor vehicles or receive, sell, store, or withdraw it
from storage for the purpose of producing or generating power
for propelling aircraft, shall be reimbursed and repaid the
amount of the tax paid upon filing with the commissioner a
signed claim in writing in such form and containing such
information as the commissioner shall require and accompanied by
the original invoice thereof. By signing any such claim which
is false or fraudulent, the applicant shall be subject to the
penalties provided in this section 296.25 for knowingly or
willfully making a false claim. The claim shall set forth the
total amount of the aviation gasoline or special fuel for
aircraft use so purchased and used by the applicant, and shall
state when and for what purpose it was used. When a claim
contains an error in computation or preparation, the
commissioner is authorized to adjust the claim in accordance
with the evidence shown on the claim or other information
available to the commissioner. The commissioner, on being
satisfied that the claimant is entitled to payment, shall
approve the claim and transmit it to the commissioner of
finance. No repayment shall be made unless the claim and
invoice shall be filed with the commissioner within one year
from the date of the purchase. The postmark on the envelope in
which the claim is mailed shall determine the date of filing.
Sec. 2. Minnesota Statutes 1988, section 296.18,
subdivision 3, is amended to read:
Subd. 3. [PENALTIES CIVIL PENALTY FOR FILING FALSE
CLAIMS CLAIM.] Every person who shall make any false statement
in any claim or invoice filed with the commissioner, or
knowingly file with the commissioner any claim or invoice
containing any false statement or collect or cause to be paid to
the person or to another a refund without being entitled
thereto, when acting pursuant to the provisions of subdivision 1
or 2, clause 3, shall forfeit the full amount of the claim and
be guilty of a misdemeanor. Every A person who violates section
296.25, subdivision 1, paragraph (a) or (b), shall forfeit the
full amount of the claim. In addition, a person who is
convicted under the provisions of this subdivision shall section
296.25, subdivision 1, paragraph (a) or (b), for filing a false
statement or claim shall, in addition to any criminal penalties
imposed, be prohibited from filing with the commissioner any
claim for refund upon gasoline purchased within six months after
such conviction.
Sec. 3. Minnesota Statutes 1988, section 296.25, is
amended to read:
296.25 [VIOLATIONS, CRIMINAL PENALTIES.]
Subdivision 1. [PENALTIES IMPOSED.] Any person who fails
to comply with any provisions of sections 296.01 to 296.421, or
who makes any false statement in any report, record, or sales
ticket required by sections 296.12, 296.14, 296.17, subdivision
5, 296.18, subdivision 2, or 296.21, shall be guilty of a
misdemeanor. A minimum fine of $200 shall be imposed on a
person who fails to obtain a license or trip permit required
under section 296.17, subdivisions 10 and 17.
Prosecutions commenced under this section may be brought in
the county in which the defendant resides or in Ramsey county.
The county attorney of any county in which the action is
commenced, shall on request of the commissioner of revenue,
prosecute violations of this chapter. Costs, fees, and expenses
incurred by any county attorney in litigation in connection with
the action may be paid from appropriations to the commissioner
of revenue for the administration of this chapter. (a) A person
who fails to comply with a provision of sections 296.01 to
296.421, or who knowingly provides false information, including,
but not limited to, false odometer readings, or who knowingly
makes a false statement in a report, record, claim, or sales
ticket required by sections 296.12; 296.14; 296.17, subdivisions
5, or 7 to 22; 296.18, subdivision 2; or 296.21, is guilty of a
gross misdemeanor.
(b) A person who willfully attempts in any manner to evade
or defeat any tax imposed by sections 296.01 to 296.421,
including, but not limited to, making and subscribing any false
statement in any report, record, claim, or sales ticket required
by sections 296.12; 296.14; 296.17, subdivisions 5, or 7 to 22;
296.18, subdivision 2; and 296.21; or making a false claim for a
refund under section 296.18, subdivision 4, is guilty of a
felony.
(c) It is a misdemeanor for a person to operate, or cause
to be operated, a licensed motor vehicle on the public highways
of this state on special fuel on which the excise tax provided
by this chapter has not been paid or the liability therefore
assumed by another person licensed under this chapter. A person
who uses gasoline, delivered into an on-farm bulk storage tank
and on which no tax has been collected, for propelling a motor
vehicle on the public highways of this state is also guilty of a
misdemeanor.
(d) An officer or employee of the state of Minnesota
charged with the enforcement of a provision of sections 296.01
to 296.421 who is employed by or who engages in business as a
distributor or dealer in petroleum products is guilty of a
misdemeanor.
(e) The authorization in this chapter for the collection of
the excise taxes by persons other than the commissioner for and
in behalf of the state of Minnesota establishes a fiduciary
relationship, for the violation of which, in failure to make
payment when due and payable, the person so authorized to
collect these excise taxes shall be deemed guilty of a violation
of section 609.54, and punished accordingly.
(f) A minimum fine of $200 shall be imposed on a person who
fails to obtain a license or trip permit required under section
296.17, subdivisions 10 and 17.
Subd. 2. [PROSECUTION OF VIOLATIONS.] It is a misdemeanor
for any person to operate, or cause to be operated, a licensed
motor vehicle on the public highways of this state on special
fuel on which the excise tax provided by this chapter has not
been paid or the liability therefor assumed by another person
licensed under this chapter. Prosecutions under this section
may be brought in the county in which the defendant resides or
in Ramsey county. On request of the commissioner of revenue,
the county attorney of a county in which the action is commenced
shall prosecute violations of this chapter. Costs, fees, and
expenses incurred by any county attorney in litigation in
connection with the action may be paid from appropriations to
the commissioner of revenue for the administration of this
chapter.
Sec. 4. [REPEALER.]
Minnesota Statutes 1988, sections 296.027; 296.16,
subdivision 3; 296.17, subdivision 13; 296.18, subdivisions 3a
and 7; and 296.24, are repealed.
Sec. 5. [EFFECTIVE DATES.]
Section 1 is effective for sales occurring on or after
August 1, 1990.
Section 2 is effective for statements or claims filed on or
after August 1, 1990.
Section 3 is effective for acts or violations occurring on
or after August 1, 1990.
Section 4 is effective August 1, 1990.
ARTICLE 4
SALES AND USE, MOTOR VEHICLE EXCISE,
AND PETROLEUM PRODUCTS TAXES
Section 1. Minnesota Statutes 1989 Supplement, section
168A.10, subdivision 1, is amended to read:
Subdivision 1. If an owner transfers interest in a vehicle
other than by the creation of a security interest, the owner
shall at the time of the delivery of the vehicle execute an
assignment and warranty of title to the transferee and shall
state the actual selling price in the space provided therefor on
the certificate. With respect to motor vehicles subject to the
provisions of section 325E.15, the transferor shall also, in the
space provided therefor on the certificate, state the true
cumulative mileage registered on the odometer or that the actual
mileage is unknown if the odometer reading is known by the
transferor to be different from the true mileage. The
transferor shall cause the certificate and assignment to be
delivered to the transferee immediately.
Sec. 2. Minnesota Statutes 1988, section 296.06,
subdivision 2, is amended to read:
Subd. 2. [REQUIREMENTS FOR ISSUANCE.] A distributor's
license shall be issued to any responsible person qualifying as
a distributor who makes application therefor, and who shall pay
to the commissioner at the time thereof and annually thereafter
a license fee of $10, and who shall further comply with the
following conditions:
(1) A written application shall be made in a manner
approved by the commissioner, who shall require the applicant or
licensee to deposit with the state treasurer securities of the
United States government or the state of Minnesota or to execute
and file a bond, with a corporate surety approved by the
commissioner, to the state of Minnesota in an amount to be
determined by the commissioner and in a form to be fixed by the
commissioner and approved by the attorney general, and which
shall be conditioned for the payment when due of all excise
taxes, inspection fees, penalties, and accrued interest arising
in the ordinary course of business or by reason of any
delinquent money which may be due the state of Minnesota; the
bond shall cover all places of business within the state where
petroleum products are received by the licensee; and the
applicant or licensee shall designate and maintain an agent in
this state upon whom service may be had for all purposes of this
section.
(2) An initial applicant for a distributor's license shall
furnish a bond in a minimum sum of $3,000 for the first year;
(3) The commissioner, on reaching the opinion that the bond
given by a licensee is inadequate in amount to fully protect the
state, shall require an additional bond in such amount as the
commissioner deems sufficient;
(4) A licensee who desires to be exempt from depositing
securities or furnishing such bond, as hereinbefore provided
shall furnish an itemized financial statement showing the assets
and the liabilities of the applicant and if it shall appear to
the commissioner, from the financial statement or otherwise,
that the applicant is financially responsible, then the
commissioner may exempt such applicant from depositing such
securities or furnishing such bond until the commissioner
otherwise orders.
(5) The premium on any bond required under clauses (1) and
(2), and on any additional bond required under clause (3), shall
be paid by the commissioner out of a bond premium fund required
to be set up from an appropriation by the legislature from
whatever funds are available. All of said bonds required during
each license period shall be purchased by the commissioner of
administration from the lowest responsible bidder after
advertising for competitive bids in the manner prescribed by
Laws 1939, chapter 431, article II, as amended. The
commissioner of administration shall call for bids within a
reasonable period prior to the commencement of license period.
(6) Each license period shall be for one year ending each
June 30.
(7) (6) Upon application to the commissioner and compliance
by the applicant with the provisions of this subdivision, the
commissioner also shall issue a distributor's license to (a) any
person engaged in this state in the bulk storage of petroleum
products and the distribution thereof by tank car or tank truck
or both, and (b) any person holding an unrevoked license as a
distributor since January 1, 1947, and (c) any person holding a
license and performing a function under the motor fuel tax law
of an adjoining state equivalent to that of a distributor under
this act, who desires to ship or deliver petroleum products from
that state to persons in this state not licensed as distributors
in this state and who agrees to assume with respect to all
petroleum products so shipped or delivered the liabilities of a
distributor receiving petroleum products in this state,
provided, however, that any such license shall be issued only
for the purpose of permitting such person to receive in this
state the petroleum products so shipped or delivered. Except as
herein provided, all persons licensed as distributors under this
clause shall have the same rights and privileges and be subject
to the same duties, requirements and penalties as other licensed
distributors.
Sec. 3. Minnesota Statutes Second 1989 Supplement, section
297A.01, subdivision 3, is amended to read:
Subd. 3. A "sale" and a "purchase" includes, but is not
limited to, each of the following transactions:
(a) Any transfer of title or possession, or both, of
tangible personal property, whether absolutely or conditionally,
and the leasing of or the granting of a license to use or
consume tangible personal property other than manufactured homes
used for residential purposes for a continuous period of 30 days
or more, for a consideration in money or by exchange or barter;
(b) The production, fabrication, printing or processing of
tangible personal property for a consideration for consumers who
furnish either directly or indirectly the materials used in the
production, fabrication, printing, or processing;
(c) The furnishing, preparing, or serving for a
consideration of food, meals or drinks, not including. "Sale"
does not include:
(1) meals or drinks served to patients, inmates, or persons
residing at hospitals, sanitariums, nursing homes, senior
citizens homes, and correctional, detention, and detoxification
facilities,
(2) meals or drinks purchased for and served exclusively to
individuals who are 60 years of age or over and their spouses or
to the handicapped and their spouses by governmental agencies,
nonprofit organizations, agencies, or churches or pursuant to
any program funded in whole or part through 42 USCA sections
3001 through 3045, wherever delivered, prepared or served, or
(3) meals and lunches served at public and private schools,
universities or colleges. "Sales" also includes meals furnished
by employers to employees at less than fair market value, except
meals furnished to employees of restaurants, resorts, and
hotels, and except meals furnished at no charge to employees of
hospitals, nursing homes, boarding care homes, sanitariums,
group homes, and correctional, detention, and detoxification
facilities, who are required to eat with the patients,
residents, or inmates residing in them. Notwithstanding section
297A.25, subdivision 2, taxable food or meals include, but are
not limited to, the following:
(i) heated food or drinks;
(ii) sandwiches prepared by the retailer;
(iii) single sales of prepackaged ice cream or ice milk
novelties prepared by the retailer;
(iv) hand-prepared or dispensed ice cream or ice milk
products including cones, sundaes, and snow cones;
(v) soft drinks and other beverages prepared or served by
the retailer;
(vi) gum;
(vii) ice;
(viii) all food sold in vending machines;
(ix) party trays prepared by the retailers; and
(x) all meals and single servings of packaged snack food,
single cans or bottles of pop, sold in restaurants and bars;
(d) The granting of the privilege of admission to places of
amusement, recreational areas, or athletic events, except a
world championship football game sponsored by the national
football league, and the privilege of having access to and the
use of amusement devices, tanning facilities, reducing salons,
steam baths, turkish baths, massage parlors, health clubs, and
spas or athletic facilities;
(e) The furnishing for a consideration of lodging and
related services by a hotel, rooming house, tourist court, motel
or trailer camp and of the granting of any similar license to
use real property other than the renting or leasing thereof for
a continuous period of 30 days or more;
(f) The furnishing for a consideration of electricity, gas,
water, or steam for use or consumption within this state, or
local exchange telephone service, intrastate toll service, and
interstate toll service, if that service originates from and is
charged to a telephone located in this state; the tax imposed on
amounts paid for telephone services is the liability of and
shall be paid by the person paying for the services. The
furnishing for a consideration of access to telephone services
by a hotel to its guests is a sale under this clause. Sales by
municipal corporations in a proprietary capacity are included in
the provisions of this clause. The furnishing of water and
sewer services for residential use shall not be considered a
sale;
(g) The furnishing for a consideration of cable television
services, including charges for basic monthly service, charges
for monthly premium service, and charges for any other similar
television services;
(h) Notwithstanding subdivision 4, and section 297A.25,
subdivision 9, the sales of horses including claiming sales and
fees paid for breeding a stallion to a mare. This clause
applies to sales and fees with respect to a horse to be used for
racing whose birth has been recorded by the Jockey Club or the
United States Trotting Association or the American Quarter Horse
Association;
(i) The furnishing for a consideration of parking services,
whether on a contractual, hourly, or other periodic basis,
except for parking at a meter;
(j) The furnishing for a consideration of services listed
in this paragraph:
(i) laundry and dry cleaning services including cleaning,
pressing, repairing, altering, and storing clothes, linen
services and supply, cleaning and blocking hats, and carpet,
drapery, upholstery, and industrial cleaning. Laundry and dry
cleaning services do not include services provided by coin
operated facilities operated by the customer;
(ii) motor vehicle washing, waxing, and cleaning services,
including services provided by coin-operated facilities operated
by the customer, and rustproofing, undercoating, and towing of
motor vehicles;
(iii) building and residential cleaning, maintenance, and
disinfecting and exterminating services;
(iv) services provided by detective agencies, security
services, burglar, fire alarm, and armored car services not
including services performed within the jurisdiction they serve
by off-duty licensed peace officers as defined in section
626.84, subdivision 1;
(v) pet grooming services;
(vi) lawn care, fertilizing, mowing, spraying and sprigging
services; garden planting and maintenance; arborist services;
tree, bush, and shrub planting, pruning, bracing, spraying, and
surgery; and tree trimming for public utility lines.
The services listed in this paragraph are taxable under section
297A.02 if the service is performed wholly within Minnesota or
if the service is performed partly within and partly without
Minnesota and the greater proportion of the service is performed
in Minnesota, based on the cost of performance. In applying the
provisions of this chapter, the terms "tangible personal
property" and "sales at retail" include taxable services and the
provision of taxable services, unless specifically provided
otherwise. Services performed by an employee for an employer
are not taxable under this paragraph. Services performed by a
partnership or association for another partnership or
association are not taxable under this paragraph if one of the
entities owns or controls more than 80 percent of the voting
power of the equity interest in the other entity. Services
performed between members of an affiliated group of corporations
are not taxable. For purposes of this section, "affiliated
group of corporations" includes those entities that would be
classified as a member of an affiliated group under United
States Code, title 26, section 1504, and who are eligible to
file a consolidated tax return for federal income tax purposes;
and
(vii) solid waste collection and disposal services as
described in section 297A.45;
(k) A "sale" and a "purchase" includes the transfer of
computer software, meaning information and directions that
dictate the function performed by data processing equipment. A
"sale" and a "purchase" does not include the design,
development, writing, translation, fabrication, lease, or
transfer for a consideration of title or possession of a custom
computer program; and
(l) The granting of membership in a club, association, or
other organization if:
(1) the club, association, or other organization makes
available for the use of its members sports and athletic
facilities (without regard to whether a separate charge is
assessed for use of the facilities); and
(2) use of the sports and athletic facilities is not made
available to the general public on the same basis as it is made
available to members.
Granting of membership includes both one-time initiation fees
and periodic membership dues. Sports and athletic facilities
include golf courses, tennis, racquetball, handball and squash
courts, basketball and volleyball facilities, running tracks,
exercise equipment, swimming pools, and other similar athletic
or sports facilities. The provisions of this paragraph do not
apply to camps or other recreation facilities owned and operated
by an exempt organization under section 501(c)(3) of the
Internal Revenue Code of 1986, as amended through December 31,
1986, for educational and social activities for young people
primarily age 18 and under.
Sec. 4. Minnesota Statutes 1988, section 297A.01,
subdivision 8, is amended to read:
Subd. 8. "Sales price" means the total consideration
valued in money, for a retail sale whether paid in money or
otherwise, excluding therefrom any amount allowed as credit for
tangible personal property taken in trade for resale, without
deduction for the cost of the property sold, cost of materials
used, labor or service cost, interest, or discount allowed after
the sale is consummated, the cost of transportation incurred
prior to the time of sale, any amount for which credit is given
to the purchaser by the seller, or any other expense
whatsoever. A deduction may be made for charges for services
that are part of the sale, including charges up to 15 percent in
lieu of tips, if the consideration for such charges is
separately stated, but no deduction shall be allowed for charges
for services that are part of a sale as defined in subdivision
3, clauses (b) to (f) (l). A deduction may also be made for
interest, financing, or carrying charges, charges for labor or
services used in installing or applying the property sold or
transportation charges if the transportation occurs after the
retail sale of the property only if the consideration for such
charges is separately stated. There shall not be included in
"sales price" cash discounts allowed and taken on sales or the
amount refunded either in cash or in credit for property
returned by purchasers.
Sec. 5. Minnesota Statutes 1988, section 297A.14,
subdivision 1, is amended to read:
Subdivision 1. [IMPOSITION.] For the privilege of using,
storing or consuming in Minnesota tangible personal property,
tickets or admissions to places of amusement and athletic
events, electricity, gas, and local exchange telephone
service or taxable services purchased for use, storage or
consumption in this state, a use tax is imposed on every person
in this state at the rate of tax imposed under section 297A.02
on the sales price of sales at retail of the items, unless the
tax imposed by section 297A.02 was paid on the sales price.
Sec. 6. Minnesota Statutes 1988, section 297A.25,
subdivision 31, is amended to read:
Subd. 31. [SALES BY GOVERNMENT TAXABLE.] This section
shall not be construed to exempt the gross receipts from sales
of tangible personal property or taxable services purchased from
the United States or any of its agencies or instrumentalities,
or the state of Minnesota, its agencies, instrumentalities or
political subdivisions by ultimate consumers, and such purchases
are hereby declared to be subject to tax, except as they may be
otherwise exempted.
Sec. 7. Minnesota Statutes 1988, section 297A.255, is
amended by adding a subdivision to read:
Subd. 5. There is specifically exempted from the
provisions of this chapter the purchase or use of aircraft
registered in the state of Minnesota by a corporation or
partnership when the transfer constitutes a transfer within the
meaning of section 351 or 721 of the Internal Revenue Code of
1986, as amended through December 31, 1989.
Sec. 8. Minnesota Statutes 1988, section 297B.035,
subdivision 1, is amended to read:
Subdivision 1. Except as provided in this section, motor
vehicles purchased for resale in the ordinary course of business
or used by any motor vehicle dealer, as defined in section
168.011, subdivision 21, who is licensed under section 168.27,
subdivision 2 or 3, which bear dealer plates as authorized by
section 168.27, subdivision 16, shall be exempt from the
provisions of this chapter.
Sec. 9. [EFFECTIVE DATE.]
Sections 1 to 8 are effective July 1, 1990.
ARTICLE 5
INCOME AND FRANCHISE TAXES AND PROPERTY TAX REFUNDS
Section 1. Minnesota Statutes Second 1989 Supplement,
section 10A.31, subdivision 5, is amended to read:
Subd. 5. In each calendar year the money in the general
account shall be allocated to candidates as follows:
(1) 21 percent for the offices of governor and lieutenant
governor together;
(2) 3.6 percent for the office of attorney general;
(3) 1.8 percent each for the offices of secretary of state,
state auditor, and state treasurer;
(4) In each calendar year during the period in which state
senators serve a four-year term, 23-1/3 percent for the office
of state senator and 46-2/3 percent for the office of state
representative;
(5) In each calendar year during the period in which state
senators serve a two-year term, 35 percent each for the offices
of state senator and state representative.
In each calendar year the money in each party account shall
be allocated as follows:
(1) 14 percent for the offices of governor and lieutenant
governor together;
(2) 2.4 percent for the office of attorney general;
(3) 1.2 percent each for the offices of secretary of state,
state auditor, and state treasurer;
(4) In each calendar year during the period in which state
senators serve a four-year term, 23-1/3 percent for the office
of state senator and 46-2/3 percent for the office of state
representative;
(5) In each calendar year during the period in which state
senators serve a two-year term, 35 percent each for the offices
of state senator and state representative;
(6) ten percent for the state committee of a political
party; money allocated to each state committee under this clause
must be deposited in a separate account and must be spent for
only those items enumerated in section 10A.275; money allocated
to a state committee under this clause must be paid to the
committee by the state treasurer as notified by the state
ethical practices board as it is received in the account on a
monthly basis, with payment on the 15th day of the calendar
month following the month in which the tax returns were received
processed by the department of revenue, provided that these
distributions would be equal to 90 percent of the amount of
money indicated in the department of revenue's weekly unedited
reports of income tax returns for that and property tax refund
returns processed in the month, as notified by the department of
revenue to the state ethical practices board. The amounts paid
to each state committee are subject to final annual biennial
adjustment and settlement as indicated according to the at the
time of each certification by required of the commissioner of
revenue under subdivision 6 subdivisions 7 and 10. If the total
amount of total payments received before September 15 by a state
committee for the period reflected on a certification by the
department of revenue is greater than different from the amount
certified by the commissioner of revenue on September 15, the
total amount of payments distributed between September 1 and
December 31 that should have been received during the period
according to the certification, each subsequent monthly payment
must be reduced by increased or decreased to the fullest extent
possible until the amount of the overpayment is recovered or the
underpayment is distributed.
To assure that moneys will be returned to the counties from
which they were collected, and to assure that the distribution
of those moneys rationally relates to the support for particular
parties or for particular candidates within legislative
districts, money from the party accounts for legislative
candidates shall be distributed as follows:
Each candidate for the state senate and state house of
representatives whose name is to appear on the ballot in the
general election shall receive money from the candidate's party
account set aside for candidates of the state senate or state
house of representatives, whichever applies, according to the
following formula;
For each county within the candidate's district the
candidate's share of the dollars allocated in that county to the
candidate's party account and set aside for that office shall be:
(a) The sum of the votes cast in the last general election
in that part of the county in the candidate's district for all
candidates of that candidate's party (i) whose names appeared on
the ballot in each voting precinct of the state and (ii) for the
state senate and state house of representatives, divided by
(b) The sum of the votes cast in that county in the last
general election for all candidates of that candidate's party
(i) whose names appeared on the ballot in each voting precinct
in the state and (ii) for the state senate and state house of
representatives, multiplied by
(c) The amount in the candidate's party account allocated
in that county and set aside for the candidates for the office
for which the candidate is running.
The sum of all the county shares calculated in the formula
above is the candidate's share of the candidate's party account.
In a year in which an election for the state senate occurs,
with respect to votes for candidates for the state senate only,
"last general election" means the last general election in which
an election for the state senate occurred.
For any party under whose name no candidate's name appeared
on the ballot in each voting precinct in the state in the last
general election, amounts in the party's account shall be
allocated based on (a) the number of people voting in the last
general election in that part of the county in the candidate's
district, divided by (b) the number of the people voting in that
county in the last general election, multiplied by (c) the
amount in the candidate's party account allocated in that county
and set aside for the candidates for the office for which the
candidate is running.
In a year in which the first election after a legislative
reapportionment is held, "the candidate's district" means the
newly drawn district, and voting data from the last general
election will be applied to the area encompassing the newly
drawn district notwithstanding that the area was in a different
district in the last general election.
If in a district there was no candidate of a party for the
state senate or state house of representatives in the last
general election, or if a candidate for the state senate or
state house of representatives was unopposed, the vote for that
office for that party shall be the average vote of all the
remaining candidates of that party in each county of that
district whose votes are included in the sums in clauses (a) and
(b). The average vote shall be added to the sums in clauses (a)
and (b) before the calculation is made for all districts in the
county.
Money from a party account not distributed to candidates
for state senator and representative in any election year shall
be returned to the general fund of the state. Money from a
party account not distributed to candidates for other offices in
an election year shall be returned to the party account for
reallocation to candidates as provided in clauses (1) to (6) in
the following year. Money from the general account refused by
any candidate shall be distributed to all other qualifying
candidates in proportion to their shares as provided in this
subdivision.
Sec. 2. Minnesota Statutes Second 1989 Supplement, section
290.17, subdivision 2, is amended to read:
Subd. 2. [INCOME NOT DERIVED FROM CONDUCT OF A TRADE OR
BUSINESS.] The income of a taxpayer subject to the allocation
rules that is not derived from the conduct of a trade or
business must be assigned in accordance with paragraphs (a) to
(f):
(a)(1) Subject to paragraphs (a)(2) and (a)(3), income from
labor or personal or professional services is assigned to this
state if, and to the extent that, the labor or services are
performed within it; all other income from such sources is
treated as income from sources without this state.
Severance pay shall be considered income from labor or
personal or professional services.
(2) In the case of an individual who is a nonresident of
Minnesota and who is an athlete or entertainer, income from
compensation for labor or personal services performed within
this state shall be determined in the following manner:
(i) The amount of income to be assigned to Minnesota for an
individual who is a nonresident salaried athletic team employee
shall be determined by using a fraction in which the denominator
contains the total number of days in which the individual is
under a duty to perform for the employer, and the numerator is
the total number of those days spent in Minnesota; and
(ii) The amount of income to be assigned to Minnesota for
an individual who is a nonresident, and who is an athlete or
entertainer not listed in clause (i), for that person's athletic
or entertainment performance in Minnesota shall be determined by
assigning to this state all income from performances or athletic
contests in this state.
(3) For purposes of this section, amounts received by a
nonresident from the United States, its agencies or
instrumentalities, the Federal Reserve Bank, the state of
Minnesota or any of its political or governmental subdivisions,
or a Minnesota volunteer firefighters' relief association, by
way of payment as a pension, public employee retirement benefit,
or any combination of these, or as a retirement or survivor's
benefit made from a plan qualifying under section 401, 403, 408,
or 409, or as defined in section 403(b) or 457 of the Internal
Revenue Code of 1986, as amended through December 31, 1987, are
not considered income derived from carrying on a trade or
business or from performing personal or professional services in
Minnesota, and are not taxable under this chapter.
(b) Income or gains from tangible property located in this
state that is not employed in the business of the recipient of
the income or gains must be assigned to this state.
(c) Except upon the sale of a partnership interest or the
sale of stock of an S corporation, income or gains from
intangible personal property not employed in the business of the
recipient of the income or gains must be assigned to this state
if the recipient of the income or gains is a resident of this
state or is a resident trust or estate.
Gain on the sale of a partnership interest is allocable to
this state in the ratio of the original cost of partnership
tangible property in this state to the original cost of
partnership tangible property everywhere, determined at the time
of the sale. If more than 50 percent of the value of the
partnership's assets consists of intangibles, gain or loss from
the sale of the partnership interest is allocated to this state
in accordance with the sales factor of the partnership for its
first full tax period immediately preceding the tax period of
the partnership during which the partnership interest was sold.
Gain on the sale of stock held in an S corporation is
allocable to this state in the ratio of the original cost of
tangible property of the S corporation within this state to the
original cost of tangible property of the S corporation
everywhere an amount equal to the gain on the sale of the stock
multiplied by the ratio that was used to compute the amount of S
corporation income assignable to Minnesota in the tax year
preceding the year of sale.
Gain on the sale of goodwill or income from a covenant not
to compete that is connected with a business operating all or
partially in Minnesota is allocated to this state to the extent
that the income from the business in the year preceding the year
of sale was assignable to Minnesota under subdivision 3.
(d) Income from the operation of a farm shall be assigned
to this state if the farm is located within this state and to
other states only if the farm is not located in this state.
(e) Income from winnings on Minnesota pari-mutuel betting
tickets, the Minnesota state lottery, and lawful gambling as
defined in section 349.12, subdivision 2, conducted within the
boundaries of the state of Minnesota shall be assigned to this
state.
(f) All items of gross income not covered in paragraphs (a)
to (e) and not part of the taxpayer's income from a trade or
business shall be assigned to the taxpayer's domicile.
Sec. 3. Minnesota Statutes 1988, section 290.17,
subdivision 5, is amended to read:
Subd. 5. [SPECIAL RULES.] Notwithstanding subdivisions 3
and 4, all income from the operation of the following types of
businesses must be allocated as follows:
(a) All income from the operation of a farm is assigned to
this state if the farm is located within this state and no such
income is assigned to this state if the farm is located without
this state.
(b) Income from a trade or business consisting principally
of the performance of personal or professional services is
assigned to this state if, and to the extent that, the services
are performed within this state.
(c) For athletic teams when the visiting team does not
share in the gate receipts, all of the team's income is assigned
to the state in which the team's operation is based.
Sec. 4. Minnesota Statutes 1989 Supplement, section
290.39, subdivision 4, is amended to read:
Subd. 4. [VOTER REGISTRATION FORM.] The commissioner shall
insert securely in each individual income tax return form or
instruction booklet distributed in an even-numbered for an
odd-numbered year a voter registration form, returnable to the
secretary of state, designed according to rules adopted by the
secretary of state. This requirement applies to forms and
booklets supplied to post offices, banks, and other outlets, as
well as to those mailed directly to taxpayers.
Sec. 5. Minnesota Statutes 1988, section 290.39,
subdivision 5, is amended to read:
Subd. 5. [PARTNERSHIPS; NONRESIDENT PARTNERS.] (a) The
commissioner may allow a partnership with five or more
nonresident partners to file a composite return on behalf of
nonresident partners who have no other Minnesota source income.
This composite return must include the names, addresses, social
security numbers, income allocation, and tax liability for all
nonresident partners electing to be covered by the composite
return.
(b) The computation of each partner's tax liability will be
determined by multiplying the income allocated to that partner
by the highest rate used to determine the tax liability for
individuals under section 290.06, subdivision 2c. Nonbusiness
deductions, standard deductions, or personal exemptions are not
allowed.
(c) The partnership must submit a request to use this
composite return filing method for nonresident partners on or
before the due date for filing the individual income tax
return. The request may be made a part of the return
filed. The requesting partnership must file a composite return
in the form prescribed by the commissioner of revenue. The
filing of a composite return is considered a request to use the
composite return filing method.
(d) The electing partner must not have any Minnesota source
income other than the income from the partnership and other
electing partnerships. If it is determined that the electing
partner has other Minnesota source income, the inclusion of the
income and tax liability for that partner under this provision
will not constitute a return to satisfy the requirements of
subdivision 1. The penalty for failure to file a return as
provided in section 290.53, subdivision 2, is assessed from the
due date for filing a return until a noncomposite return is
filed. The tax paid for such an individual as part of the
composite return is allowed as a payment of the tax by the
individual on the date on which the composite return payment was
made. If the electing nonresident partner has no other
Minnesota source income, filing of the composite return
constitutes a return for purposes of subdivision 1.
(e) This subdivision does not preclude the requirement that
an individual pay estimated tax if the individual's liability
would exceed the requirements set forth in section 290.93.
However, a composite estimate may be filed in a manner similar
to and containing the same information required under paragraph
(a).
(f) If an electing partner's share of the partnership's
gross income from Minnesota sources is less than the filing
requirements for a nonresident under section 290.37, subdivision
1, the tax liability is zero. However, a statement showing the
partner's share of gross income must be included as part of the
composite return.
(g) The election provided in this subdivision is not
available to any partner other than a full-year nonresident
individual who has no other Minnesota source income.
(h) A corporation defined in section 290.9725 and its
nonresident shareholders may make an election under this
subdivision. The provisions covering the partnership apply to
the corporation and the provisions applying to the partner apply
to each shareholder.
(i) Estates and trusts distributing current income only and
the nonresident individual beneficiaries of such estates or
trusts may make an election under this subdivision. The
provisions covering the partnership apply to the estate or
trust. The provisions applying to the partner apply to each
beneficiary.
Sec. 6. Minnesota Statutes 1988, section 290.49,
subdivision 3, is amended to read:
Subd. 3. [OMISSION IN EXCESS OF 25 PERCENT.] If the
taxpayer omits from gross income an amount properly includable
therein which is in excess of 25 percent of the amount of gross
income stated in the return, the tax may be assessed, or a
proceeding in court for the collection of such tax may be begun
at any time within 6-1/2 years after the return was filed.
For purposes of this subdivision, the term "gross income"
shall mean gross income as defined in section 290.37,
subdivision 1, clause (c) 290.01, subdivision 20.
Sec. 7. Minnesota Statutes 1988, section 290.92,
subdivision 12, is amended to read:
Subd. 12. [WITHHELD AMOUNT, CREDIT AGAINST TAX.] The
amount deducted and withheld as tax under subdivision 2a or, 3,
4b, or 4c or section 290.923, subdivision 2, during any calendar
year upon the wages, partnership income, or "S" corporation
income of any individual or person receiving royalty payments
shall be allowed as a credit to the recipient of the income
against the taxes imposed by this chapter or by chapter 298, for
a taxable year beginning in such calendar year. If more than
one taxable year begins in such calendar year, such amount shall
be allowed as a credit against the taxes for the last taxable
year so beginning.
Sec. 8. Minnesota Statutes 1988, section 290.92,
subdivision 23, is amended to read:
Subd. 23. [WITHHOLDING BY EMPLOYER OF DELINQUENT TAXES.]
(1) The commissioner may, within five years after the date of
assessment of the tax, give notice to any employer deriving
income which has a taxable situs in this state regardless of
whether the income is exempt from taxation, that an employee of
that employer is delinquent in a certain amount with respect to
any state taxes, including penalties, interest and costs. The
commissioner can proceed under this subdivision only if the tax
is uncontested or if the time for appeal of the tax has
expired. The commissioner shall not proceed under this
subdivision until the expiration of 30 days after mailing to the
taxpayer, at the taxpayer's last known address, a written notice
of (a) the amount of taxes, interest, and penalties due from the
taxpayer and demand for their payment, and (b) the
commissioner's intention to require additional withholding by
the taxpayer's employer pursuant to this subdivision. The
effect of the notice shall expire 180 days after it has been
mailed to the taxpayer provided that the notice may be renewed
by mailing a new notice which is in accordance with this
subdivision. The renewed notice shall have the effect of
reinstating the priority of the original claim. The notice to
the taxpayer shall be in substantially the same form as that
provided in section 571.41. The notice shall further inform the
taxpayer of the wage exemptions contained in section 550.37,
subdivision 14. If no statement of exemption is received by the
commissioner within 30 days from the mailing of the notice, the
commissioner may proceed under this subdivision. The notice to
the taxpayer's employer may be served by mail or by delivery by
an employee of the department of revenue and shall be in
substantially the same form as provided in section 571.495.
Upon receipt of notice, the employer shall withhold from
compensation due or to become due to the employee, the total
amount shown by the notice, subject to the provisions of section
571.55. The employer shall continue to withhold each pay period
until the total amount shown by the notice is paid in full.
Upon receipt of notice by the employer, the claim of the state
of Minnesota shall have priority over any subsequent
garnishments or wage assignments. The commissioner may arrange
between the employer and the employee for withholding a portion
of the total amount due the employee each pay period, until the
total amount shown by the notice plus accrued interest has been
withheld.
The "compensation due" any employee is defined in
accordance with the provisions of section 571.55. The maximum
withholding allowed under this subdivision for any one pay
period shall be decreased by any amounts payable pursuant to a
garnishment action with respect to which the employer was served
prior to being served with the notice of delinquency and any
amounts covered by any irrevocable and previously effective
assignment of wages; the employer shall give notice to the
department of the amounts and the facts relating to such
assignments within ten days after the service of the notice of
delinquency on the form provided by the department of revenue as
noted in this subdivision. In crediting amounts withheld
against delinquent taxes of an employee, the department shall
apply amounts withheld in the following order: penalties,
interest, tax, and costs.
(2) If the employee ceases to be employed by the employer
before the full amount set forth in a notice of delinquency plus
accrued interest has been withheld, the employer shall
immediately notify the commissioner in writing of the
termination date of the employee and the total amount withheld.
No employer may discharge any employee by reason of the fact
that the commissioner has proceeded under this subdivision. If
an employer discharges an employee in violation of this
provision, the employee shall have the same remedy as provided
in section 571.61, subdivision 2.
(3) The employer shall, by the date prescribed in
subdivision 6, remit to the commissioner, on a form and in the
manner prescribed by the commissioner, the amount withheld
during the calendar quarter under this subdivision. Should any
employer, after notice, willfully fail to withhold in accordance
with the notice and this subdivision, or willfully fail to remit
any amount withheld as required by this subdivision, the
employer shall be liable for the total amount set forth in the
notice together with accrued interest which may be collected by
any means provided by law relating to taxation. No amount
required to be paid by an employer by reason of the employer's
failure to remit under this subdivision, may be deducted from
the gross income of the employer, under sections 290.09,
subdivision 4 or 290.01, subdivisions 20 to 20f. Any amount
collected from the employer for failure to withhold or for
failure to remit under this subdivision shall be credited to the
employee's account in the following manner: penalties,
interest, tax, and costs.
(4) Clauses (1), (2) and (3), except provisions imposing a
liability on the employer for failure to withhold or remit,
shall apply to cases in which the employer is the United States
or any instrumentality thereof or this state or any municipality
or other subordinate unit thereof.
(5) The commissioner shall refund to the employee excess
amounts withheld from the employee under this subdivision. If
any excess results from payments by the employer because of
willful failure to withhold or remit as prescribed in clause (3)
above, the excess attributable to the employer's payment shall
be refunded to the employer.
(6) Employers required to withhold delinquent taxes,
penalties, interest, and costs under this subdivision shall not
be required to compute any additional interest, costs or other
charges to be withheld.
(7) The collection remedy provided to the commissioner by
this subdivision shall have the same legal effect as if it were
a levy made pursuant to section 270.70.
Sec. 9. Minnesota Statutes 1988, section 290.93,
subdivision 1, is amended to read:
Subdivision 1. [REQUIREMENT OF DECLARATION.] (1) Every
individual shall, at the time prescribed in subdivision 5, make
and file with the commissioner a declaration of estimated tax
for the taxable year if
the gross income (for purposes of this subdivision and
subdivision 5 as defined in section 290.37, subdivision 1,
clause (c) 290.01, subdivision 20) for the taxable year can
reasonably be expected to exceed the gross income amounts set
forth in section 290.37, subdivision 1 pertaining to the
requirements for making a return.
(2) If the individual is an infant or incompetent person,
the declaration shall be made by the individual's guardian.
(3) Notwithstanding the provisions of this section, no
declaration is required if the estimated tax (as defined in
subdivision 3) is less than $500.
Sec. 10. Minnesota Statutes 1988, section 290A.03,
subdivision 3, is amended to read:
Subd. 3. [INCOME.] (1) "Income" means the sum of the
following:
(a) the greater of federal adjusted gross income as defined
in the Internal Revenue Code or zero; and
(b) the sum of the following amounts to the extent not
included in clause (a):
(i) all nontaxable income;
(ii) the amount of a passive activity loss that is not
disallowed as a result of section 469, paragraph (i) or (1) of
the Internal Revenue Code and the amount of passive activity
loss carryover allowed under section 469(b) of the Internal
Revenue Code;
(iii) an amount equal to the total of any discharge of
qualified farm indebtedness of a solvent individual excluded
from gross income under section 108(g) of the Internal Revenue
Code;
(iv) cash public assistance and relief;
(v) any pension or annuity (including railroad retirement
benefits, all payments received under the federal Social
Security Act, supplemental security income, and veterans
benefits), which was not exclusively funded by the claimant or
spouse, or which was funded exclusively by the claimant or
spouse and which funding payments were excluded from federal
adjusted gross income in the years when the payments were made;
(vi) interest received from the federal or a state
government or any instrumentality or political subdivision
thereof;
(vii) workers' compensation;
(viii) nontaxable strike benefits;
(ix) the gross amounts of payments received in the nature
of disability income or sick pay as a result of accident,
sickness, or other disability, whether funded through insurance
or otherwise;
(x) a lump sum distribution under section 402(e)(3) of the
Internal Revenue Code;
(xi) contributions made by the claimant to an individual
retirement account, including a qualified voluntary employee
contribution; simplified employee pension plan; self-employed
retirement plan; cash or deferred arrangement plan under section
401(k) of the Internal Revenue Code; or deferred compensation
plan under section 457 of the Internal Revenue Code; and
(xii) nontaxable scholarship or fellowship grants.
In the case of an individual who files an income tax return
on a fiscal year basis, the term "federal adjusted gross income"
shall mean federal adjusted gross income reflected in the fiscal
year ending in the calendar year. Federal adjusted gross income
shall not be reduced by the amount of a net operating loss
carryback or carryforward or a capital loss carryback or
carryforward allowed for the year.
(2) "Income" does not include
(a) amounts excluded pursuant to the Internal Revenue Code,
sections 101(a), 102, and 121;
(b) amounts of any pension or annuity which was exclusively
funded by the claimant or spouse and which funding payments were
not excluded from federal adjusted gross income in the years
when the payments were made;
(c) surplus food or other relief in kind supplied by a
governmental agency;
(d) relief granted under this chapter; or
(e) child support payments received under a temporary or
final decree of dissolution or legal separation.
(3) The sum of the following amounts shall may be
subtracted from income:
(a) for the claimant's first dependent, the exemption
amount multiplied by 1.4;
(b) for the claimant's second dependent, the exemption
amount multiplied by 1.3;
(c) for the claimant's third dependent, the exemption
amount multiplied by 1.2;
(d) for the claimant's fourth dependent, the exemption
amount multiplied by 1.1;
(e) for the claimant's fifth dependent, the exemption
amount; and
(f) if the claimant or claimant's spouse was disabled or
attained the age of 65 prior to June 1 of the year for which the
taxes were levied or rent paid, the exemption amount.
For purposes of this subdivision, the "exemption amount"
means the exemption amount under section 151(d) of the Internal
Revenue Code of 1986, as amended through December 31, 1987, for
the taxable year for which the income is reported.
Sec. 11. Minnesota Statutes 1988, section 290A.04,
subdivision 1, is amended to read:
Subdivision 1. A refund shall be allowed each claimant in
the amount that property taxes payable or rent constituting
property taxes exceed the percentage of the household income of
the claimant specified in subdivision 2 in the year for which
the taxes were levied or in the year in which the rent was paid
as specified in subdivision 2. If the amount of property taxes
payable or rent constituting property taxes is equal to or less
than the percentage of the household income of the claimant
specified in subdivision 2 in the year for which the taxes were
levied or in the year in which the rent was paid, the claimant
shall not be eligible for a state refund pursuant to this
section. For purposes of claiming this refund, a claimant who
owns a homestead part of the year and rents part of the year may
add the rent constituting property taxes to the qualifying tax
on the homestead.
Sec. 12. Minnesota Statutes Second 1989 Supplement,
section 290A.04, subdivision 2h, is amended to read:
Subd. 2h. (a) If the gross property taxes payable on a
homestead increase more than ten percent over the net property
taxes payable in the prior year on the same property that is
owned by the same owner in both years, and the amount of that
increase is $40 or more for taxes payable in 1990 and 1991, $60
or more for taxes payable in 1992, $80 or more for taxes payable
in 1993, and $100 or more for taxes payable in 1994, a claimant
who is a homeowner shall be allowed an additional refund equal
to the sum of (1) 75 percent of the first $250 of the amount of
the increase over ten percent for taxes payable in 1990 and
1991, 75 percent of the first $275 of the amount of the increase
over ten percent for taxes payable in 1992, 75 percent of the
first $300 of the amount of the increase over ten percent for
taxes payable in 1993, and 75 percent of the first $325 of the
amount of the increase over ten percent for taxes payable in
1994, and (2) 90 percent of the amount of the increase over ten
percent plus $250 for taxes payable in 1990 and 1991, 90 percent
of the amount of the increase over ten percent plus $275 for
taxes payable in 1992, 90 percent of the amount of the increase
over ten percent plus $300 for taxes payable in 1993, and 90
percent of the amount of the increase over ten percent plus $325
for taxes payable in 1994. This subdivision shall not apply to
any increase in the net gross property taxes payable
attributable to improvements made to the homestead after the
assessment date for the prior year's taxes.
(b) For purposes of this subdivision, the following terms
have the meanings given:
(1) "Net property taxes payable" means property taxes
payable after reductions made under sections 273.13,
subdivisions 22 and 23; 273.132; 273.135; 273.1391; and 273.42,
subdivision 2, and any other state paid property tax credits and
after the deduction of tax refund amounts for which the claimant
qualifies pursuant to subdivision 2 and this subdivision.
(2) "Gross property taxes" means net property taxes payable
determined without regard to the refund allowed under this
subdivision.
(c) In addition to the other proofs required by this
chapter, each claimant under this subdivision shall file with
the property tax refund return a copy of the property tax
statement for taxes payable in the preceding year or other
documents required by the commissioner.
On or before December 1, 1990, and December 1 of each of
the following three years, the commissioner shall estimate the
cost of making the payments provided by this subdivision for
taxes payable in the following year. Notwithstanding the open
appropriation provision of section 290A.23, if the estimated
total refund claims exceed the following amounts for the taxes
payable year designated, the commissioner shall decrease the
percentages of the excess taxes the state will pay and increase
the dollar amount of tax increase which must occur before a
taxpayer qualifies for a refund.
Taxes payable in: Appropriation limit
1991 $7,000,000
1992 $6,500,000
1993 $6,000,000
1994 $5,500,000
The commissioner shall make the adjustments so that half of
the estimated savings come from decreasing the percentages of
the excess taxes the state will pay and half of the estimated
savings come from increasing the dollar amount of the tax
increase which must occur before a taxpayer qualifies for a
refund. The determinations of the revised percentages and
thresholds by the commissioner are not rules subject to chapter
14.
Sec. 13. Minnesota Statutes Second 1989 Supplement,
section 290A.04, subdivision 2i, is amended to read:
Subd. 2i. If the net property taxes payable in 1990 on a
seasonal residential and recreational property, not devoted to
commercial use, increase more than ten percent over the net
property taxes payable in 1989 and if the amount is $40 or more,
one claimant individual who is an owner of the property in both
years is allowed a refund equal to 75 percent of the first $250
of the excess of the increase over ten percent. This
subdivision does not apply to the portion of an increase in
taxes payable that are attributable to improvements to the
property.
The individual claiming the refund can use only one
contiguous seasonal residential and recreational property in
computing the refund and is allowed only one refund. For the
purposes of this subdivision, a husband and wife are treated as
one individual.
In addition to the other proofs required by this chapter,
each claimant individual claiming a refund under this
subdivision shall file with the application a copy of the
property tax statement for property taxes payable in 1989 and
1990 and any other documents required by the commissioner.
Sec. 14. Laws 1989, chapter 28, section 24, is amended to
read:
Sec. 24. [FEDERAL CHANGES.]
The changes made by sections 1002, 1004, 1006, 1008, 1009,
1011, 1014, 1018, 3041, 6002, 6026, and 6286 6282 of the
Technical and Miscellaneous Revenue Act of 1988, Public Law
Number 100-647, which affect the computation of Minnesota gross
income as defined in Minnesota Statutes, section 290.01,
subdivision 20; lump sum distributions as allowed by Minnesota
Statutes, section 290.032; accounting provision applied under
Minnesota Statutes, section 290.07; contribution deduction
allowed by Minnesota Statutes, sections 290.089 and 290.21;
depreciation, amortization, and expensing provisions allowed
under Minnesota Statutes, section 290.09; the recognition rules
for distributions and reorganization rules provided by Minnesota
Statutes, sections 290.13 to 290.139; and the grantor trust and
reversionary interest rule exceptions and limitations under
Minnesota Statutes, sections 290.23 and 290.25, for years
beginning before January 1, 1987, shall be in effect at the same
time they become effective for federal income tax purposes.
The additional statute of limitations to file amended
returns allowing contributions to institutions of higher
education and allowing an election to claim losses on deposits
in certain insolvent financial institutions under provisions of
sections 6001 and 1009 of the Technical and Miscellaneous
Revenue Act of 1988, shall apply to Minnesota for the same
period as the federal period applies plus an additional six
months.
The waiver of the estimated tax penalties provided by
section 1019 of the Technical and Miscellaneous Revenue Act of
1988, shall also apply to Minnesota to the extent the
underpayment was created or increased by any provisions of the
changes due to applying the federal law changes.
Sec. 15. [REPEALER.]
Minnesota Statutes 1988, section 290.23, subdivision 15, is
repealed.
Sec. 16. [EFFECTIVE DATE.]
Section 1 is effective on the day following final enactment.
Sections 3, 5, and 15 are effective for taxable years beginning
after December 31, 1989. Sections 2 and 7 are effective for
taxable years beginning after December 31, 1988. Section 10 is
effective for claims based on rent paid in 1989 and subsequent
years and claims based on property taxes payable in 1990 and
subsequent years. Sections 11 and 12 are effective beginning
for property taxes payable in 1990. Section 13 is effective
beginning for property taxes paid in 1990.
ARTICLE 6
INSURANCE TAXES
Section 1. Minnesota Statutes Second 1989 Supplement,
section 60A.15, subdivision 1, is amended to read:
Subdivision 1. [DOMESTIC AND FOREIGN COMPANIES.] (a) On or
before April 15, June 15, and December 15 of each year, every
domestic and foreign company, including town and farmers' mutual
insurance companies and domestic mutual insurance companies,
shall pay to the commissioner of revenue installments equal to
one-third of the insurer's total estimated tax for the current
year. Except as provided in paragraph (b), installments must be
based on a sum equal to two percent of the premiums described in
paragraph (c).
(b) For town and farmers' mutual insurance companies and
mutual property and casualty insurance companies other than
those (i) writing life insurance, or (ii) whose total assets at
the end of the preceding calendar year exceed $1,600,000,000,
the installments must be based on an amount equal to the
following percentages of the premiums described in paragraph (c):
(1) for premiums paid after December 31, 1988, and before
January 1, 1992, one percent; and
(2) for premiums paid after December 31, 1991, one-half of
one percent.
(c) Installments under paragraph (a) or (b) are percentages
of gross premiums less return premiums on all direct business
received by the insurer in this state, or by its agents for it,
in cash or otherwise, during such year, excepting premiums
written for marine insurance as specified in subdivision 6.
(d) Failure of a company to make payments of at least
one-third of either (1) the total tax paid during the previous
calendar year or (2) 80 percent of the actual tax for the
current calendar year shall subject the company to the penalty
and interest provided in this section, unless the total tax for
the current tax year is $500 or less.
Sec. 2. Minnesota Statutes 1988, section 60A.198, is
amended by adding a subdivision to read:
Subd. 6. [ALLOCATION OF PREMIUMS ACCORDING TO LOCATION OF
SUBJECT MATTER.] If the insurance described in subdivision 4
also covers a subject of insurance residing, located, or to be
performed outside this state, for the purposes of this section,
a proper pro rata portion of the entire premium payable for all
of that insurance must be allocated according to the subjects of
insurance residing, located, or to be performed in this state.
Sec. 3. Minnesota Statutes 1989 Supplement, section
69.021, subdivision 6, is amended to read:
Subd. 6. [CALCULATION OF APPORTIONMENT OF AID TO
COUNTIES.] With respect to firefighters, one-half of the state
aid available shall be distributed to the counties in proportion
to their population as shown by the last official statewide
federal census. The remaining one-half of the state aid
available shall be distributed to the counties in proportion to
their net tax capacity, excluding mineral values.
In the case of incorporated or municipal fire departments
furnishing fire protection to cities, towns or townships in
other counties as evidenced by valid fire service contracts
filed with the commissioner of commerce and county auditor the
distribution to the respective counties shall be adjusted
proportionately to take into consideration the crossover fire
protection service. Necessary adjustments shall be made to
subsequent apportionments.
The state aid available in respect to peace officers shall
not exceed the amount of tax collected and shall be distributed
to the counties in proportion to the total number of active
peace officers, as defined in section 69.011, subdivision 1,
clause (g), in each county who are employed either by
municipalities maintaining police departments or by the county.
Any necessary adjustments shall be made to subsequent
apportionments.
Sec. 4. Minnesota Statutes 1988, section 69.771,
subdivision 3, is amended to read:
Subd. 3. [REMEDY FOR NONCOMPLIANCE; DETERMINATION.] Any
municipality in which there exists a firefighters' relief
association as specified in subdivision 1 which does not comply
with the applicable provisions of sections 69.771 to 69.776 or
the provisions of any applicable special law relating to the
funding or financing of the association shall not qualify
initially to receive, or be entitled subsequently to retain,
fire state aid pursuant to sections 69.011 to 69.051 until the
reason for disqualification is remedied, whereupon the
municipality or relief association, if otherwise qualified,
shall be entitled to again receive fire state aid for the year
occurring immediately subsequent to the year in which the
disqualification is remedied. The commissioner of commerce
state auditor shall determine if a municipality to which a
firefighters' relief association is directly associated or a
firefighters' relief association fails to comply with the
provisions of sections 69.771 to 69.776 or the funding or
financing provisions of any applicable special law based upon
the information contained in the annual financial report of the
firefighters' relief association required pursuant to section
69.051.
Sec. 5. Minnesota Statutes 1988, section 69.772,
subdivision 2a, is amended to read:
Subd. 2a. [DETERMINATION OF ACCRUED LIABILITY FOR
RECIPIENTS OF INSTALLMENT PAYMENTS.] Each firefighters' relief
association which pays a lump sum service pension in installment
payments to a retired firefighter pursuant to section 424A.02,
subdivision 8, shall determine the accrued liability of the
special fund of the firefighters' relief association relative to
each retired member receiving a lump sum service pension in
installment payments calculated individually as the sum of each
future installment payment discounted at an interest rate of
five percent, compounded annually, from the date the installment
payment is scheduled to be paid to December 31. If the bylaws
of the relief association provide for the payment of interest on
unpaid installments, the amount of interest, projected to
December 31, shall be added to the accrued liability
attributable to each retired member. The sum of the accrued
liability attributable to each retired member of the relief
association receiving a lump sum service pension in installment
payments shall be the total additional accrued liability of the
special fund of the relief association as of December 31, and
shall be added to the accrued liability of the special fund of
the relief association calculated pursuant to subdivision 2 for
purposes of calculating the financial requirements of the relief
association and the minimum obligation of the municipality
pursuant to subdivision 3.
To the extent that the commissioner of commerce state
auditor deems it to be necessary or practical, the commissioner
state auditor may specify and issue procedures, forms or
mathematical tables for use in performing the calculations
required pursuant to this subdivision.
Sec. 6. Minnesota Statutes 1988, section 69.774,
subdivision 1, is amended to read:
Subdivision 1. [AUTHORIZED INCLUSION IN FIRE STATE AID
PROGRAM; COVERED NONPROFIT CORPORATIONS.] This section shall
apply to any independent nonprofit firefighting corporation
incorporated or organized pursuant to chapter 317 which operates
exclusively for firefighting purposes, which is composed of
volunteer firefighters, which has a duly established separate
subsidiary incorporated firefighters' relief association which
provides retirement coverage for or pays a service pension to a
retired firefighter or a retirement benefit to a surviving
dependent of either an active or a retired firefighter, and
which operates subject to the service pension minimum
requirements for entitlement to and maximums for a service
pension contained in section 424A.02, or a special law modifying
those requirements or maximums. Notwithstanding any law to the
contrary, a municipality contracting with an independent
nonprofit firefighting corporation shall be included in the
distribution of fire state aid to the appropriate county auditor
by the commissioner of commerce state auditor only if the
independent nonprofit firefighting corporation complies with the
provisions of this section.
Sec. 7. Minnesota Statutes 1988, section 299F.21,
subdivision 1, is amended to read:
Subdivision 1. [ESTIMATED INSTALLMENT PAYMENTS.] On or
before April 15, June 15, and December 15 of each year, every
licensed insurance company, including reciprocals or
interinsurance exchanges, doing business in the state, excepting
farmers' mutual fire insurance companies and township mutual
fire insurance companies, shall pay to the commissioner of
revenue installments equal to one-third of, a tax upon its fire
premiums or assessments or both, based on a sum equal to
one-half of one percent of the estimated fire premiums and
assessments, less return premiums and dividends, on all direct
business received by it in this state, or by its agents for it,
in cash or otherwise, during the year, including premiums on
policies covering fire risks only on automobiles, whether
written under floater form or otherwise. In the case of a
mutual company or reciprocal exchange the dividends or savings
paid or credited to members in this state shall be construed to
be return premiums. The money so received into the state
treasury shall be credited to the general fund. A company that
fails to make payments of at least one-third of either (1) the
total tax paid during the previous calendar year or (2) 80
percent of the actual tax for the current calendar year is
subject to the penalty and interest provided in this chapter,
unless the total tax for the current tax year is $500 or less.
Sec. 8. [EFFECTIVE DATE.]
Sections 1, 2, and 7 are effective for tax years beginning
after December 31, 1990. Sections 3, 4, 5, and 6 are effective
the day after final enactment.
ARTICLE 7
TECHNICAL AND ADMINISTRATIVE CHANGES
Section 1. Minnesota Statutes 1988, section 116K.04,
subdivision 4, is amended to read:
Subd. 4. The commissioner shall:
(1) Appoint the state demographer, who shall be compensated
in accordance with section 43A.18, subdivision 3. The state
demographer shall be professionally competent in the field of
demography and shall possess demonstrated ability, based upon
past performance;
(2) Continuously gather and develop demographic data within
the state;
(3) Design and test methods of research and data
collection;
(4) Periodically prepare population projections for
designated regions and for the state and may periodically
prepare projections for each county, or other political or
geographic division as necessary to carry out the purposes of
this section;
(5) Review, comment, and prepare analysis of population
estimates and projections made by state agencies, political
subdivisions, other states, federal agencies or nongovernmental
persons, institutions or commissions;
(6) Serve as the state liaison with the federal bureau of
census, and coordinate the activities of the state planning
agency with federal demographic activities to the fullest extent
possible, and shall aid the legislature in preparing a census
data plan and form for each decennial census;
(7) Compile an annual study of population estimates on the
basis of county, regional or other political or geographic
divisions as necessary to carry out the purposes of this
subdivision and section 116K.05;
(8) On or before January 1 of each year, issue a report to
the legislature containing an analysis of the demographic
implications of the annual population study and population
projections;
(9) Cause to be prepared maps of all counties in the state,
all municipalities with a population of 10,000 or more, and any
other municipalities as deemed necessary for census purposes,
according to scale and detail recommended by the federal bureau
of the census, with the maps of cities showing boundaries of
precincts; and
(10) Prepare an estimate of population and of the number of
households for each governmental subdivision for which the
metropolitan council does not prepare an annual estimate, and
shall communicate the estimates to the governing body of each
governmental subdivision by May 1 of each year.; and
(11) Prepare an estimate of population and number of
households for an area annexed by a governmental subdivision
subject to levy limits under sections 275.50 to 275.56 if a
municipal board order under section 414.01, subdivision 14,
exists for the annexation and if the population in the annexed
area is equal to either (i) at least 50 people or (ii) at least
ten percent of the population of a governmental subdivision or
unorganized territory that is losing area by the annexation.
The estimate shall be of the population as of the date, within
the 12-month period after the annexation occurs, for which a
population estimate for the governmental subdivision is made by
either the state demographer under clause (10) or by the
metropolitan council.
Sec. 2. Minnesota Statutes 1989 Supplement, section
168.013, subdivision 5, is amended to read:
Subd. 5. [CERTAIN VEHICLES SUBJECT TO PERSONAL PROPERTY
TAX.] Motor vehicles not subject to taxation as provided in
section 168.012, but subject to taxation as personal property
within the state under section 273.36 or 273.37, subdivision 1,
shall be assessed and valued at 33-1/3 percent of the market
value thereof, have a tax capacity as provided in section
273.13, subdivision 24, provided, that if the person against
whom any tax has been levied on the ad valorem basis because of
any motor vehicle shall, during the calendar year for which such
tax is levied, be also taxed under the provisions of this
chapter, then and in that event, upon proper showing, the
commissioner of revenue shall grant to the person against whom
said ad valorem tax was levied, such reduction or abatement of
net tax capacity or taxes as was occasioned by the so-called ad
valorem tax imposed, and provided further that, if said ad
valorem tax upon any motor vehicle has been assessed against a
dealer in new and unused motor vehicles, and the tax imposed by
this chapter for the required period is thereafter paid by the
owner, then and in that event, upon proper showing, the
commissioner of revenue, upon the application of said dealer,
shall grant to such dealer against whom said ad valorem tax was
levied such reduction or abatement of net tax capacity or taxes
as was occasioned by the so-called ad valorem tax imposed. If
such motor vehicle be registered and taxed under this chapter
for a fractional part of the calendar year only, then such ad
valorem tax shall be reduced in the percentage which such
fractional part of the years bears to a full year.
Sec. 3. Minnesota Statutes 1989 Supplement, section
272.16, is amended to read:
272.16 [TRANSFER OF SPECIFIC PART.]
Subdivision 1. [TRANSFER OF SPECIFIC PART.] When any part
less than the whole of any parcel of land, as charged in the tax
lists, is conveyed, the county auditor shall transfer the same
whenever the seller and purchaser agree, in a writing signed by
them, or personally appear before the county auditor and agree,
upon the amount of the net tax capacity to be transferred
therewith; but,. If the seller and purchaser do not so agree,
the county auditor shall make such a division of the net tax
capacity as may appear that appears just to the auditor just.
If the county auditor is satisfied that the proportion of the
net tax capacity so agreed to be transferred is greater than the
proportional value of the land to be transferred therewith, and
that such the agreement was made by collusion of the parties,
and with a view fraudulently to evade payment of taxes assessed
on the entire parcel, the auditor may refuse to make such the
transfer; and,. When any such transfer has already been
procured by fraudulent agreement, the auditor shall cancel the
same it, and the land so transferred shall be charged with taxes
in the same manner as though the transfer had not been made.
Subd. 2. [SPECIFIC PART CONVEYED AFTER EXECUTION OF A
LENDER'S LIEN.] Notwithstanding the provisions of sections
272.12, 272.121, and 272.162, a lender that acquires, through
execution of a lien, any part less than the whole of any parcel
of land, as charged in the tax lists, may convey that part upon
payment of the proper proportion of taxes due and owing on that
part. The county auditor shall determine the proper proportion
of taxes to be paid. The lender shall be required to provide
the county auditor with instruments that document the lender's
lien and the acquisition of the part.
Sec. 4. Minnesota Statutes 1989 Supplement, section
273.01, is amended to read:
273.01 [LISTING AND ASSESSMENT, TIME.]
All real property subject to taxation shall be listed and
at least one-fourth of the parcels listed shall be appraised
each year with reference to their value on January 2 preceding
the assessment so that each parcel shall be reappraised at
maximum intervals of four years. All real property becoming
taxable in any year shall be listed with reference to its value
on January 2 of that year. Except as provided in this section
and section 274.01, subdivision 1, all real property assessments
shall be completed two weeks prior to the date scheduled for the
local board of review or equalization. No changes in valuation
or classification which are intended to correct errors in
judgment by the county assessor may be made by the county
assessor after the board of review or the county board of
equalization has adjourned; however, corrections of errors that
are merely clerical in nature or changes that extend homestead
treatment to property are permitted after adjournment until the
tax extension date for that assessment year. Any changes made
by the assessor after this time adjournment must be fully
documented and maintained in a file in the assessor's office and
shall be available for review by any person. A copy of any
changes made during this period shall be sent to the county
board no later than December 31 of the assessment year. In the
event a valuation and classification is not placed on any real
property by the dates scheduled for the local board of review or
equalization the valuation and classification determined in the
preceding assessment shall be continued in effect and the
provisions of section 273.13 shall, in such case, not be
applicable, except with respect to real estate which has been
constructed since the previous assessment. Real property
containing iron ore, the fee to which is owned by the state of
Minnesota, shall, if leased by the state after January 2 in any
year, be subject to assessment for that year on the value of any
iron ore removed under said lease prior to January 2 of the
following year. Personal property subject to taxation shall be
listed and assessed annually with reference to its value on
January 2; and, if acquired on that day, shall be listed by or
for the person acquiring it.
Sec. 5. Minnesota Statutes 1989 Supplement, section
273.11, subdivision 1, is amended to read:
Subdivision 1. [GENERALLY.] Except as provided in
subdivisions 6, 8, and 9 or section 273.17, subdivision 1, all
property shall be valued at its market value. The market value
as determined pursuant to this section shall be stated such that
any amount under $100 is rounded up to $100 and any amount
exceeding $100 shall be rounded to the nearest $100. In
estimating and determining such value, the assessor shall not
adopt a lower or different standard of value because the same is
to serve as a basis of taxation, nor shall the assessor adopt as
a criterion of value the price for which such property would
sell at a forced sale, or in the aggregate with all the property
in the town or district; but the assessor shall value each
article or description of property by itself, and at such sum or
price as the assessor believes the same to be fairly worth in
money. In assessing any tract or lot of real property, the
value of the land, exclusive of structures and improvements,
shall be determined, and also the value of all structures and
improvements thereon, and the aggregate value of the property,
including all structures and improvements, excluding the value
of crops growing upon cultivated land. In valuing real property
upon which there is a mine or quarry, it shall be valued at such
price as such property, including the mine or quarry, would sell
for a fair, voluntary sale, for cash. In valuing real property
which is vacant, the fact that such property is platted shall
not be taken into account. An individual lot of such platted
property shall not be assessed in excess of the assessment
valuation of the land as if it were unplatted until the lot is
improved with a permanent improvement all or a portion of which
is located upon the lot, or for a period of three years after
final approval of said plat whichever is shorter. When a lot is
sold or construction begun, the net tax capacity of that lot or
any single contiguous lot fronting on the same street shall be
eligible for reassessment revaluation. All property, or the use
thereof, which is taxable under section 272.01, subdivision 2,
or 273.19, shall be valued at the market value of such property
and not at the value of a leasehold estate in such property, or
at some lesser value than its market value.
Sec. 6. Minnesota Statutes Second 1989 Supplement, section
273.124, subdivision 6, is amended to read:
Subd. 6. [LEASEHOLD COOPERATIVES.] When one or more
dwellings or one or more buildings which each contain several
dwelling units is owned by a nonprofit corporation subject to
the provisions of chapter 317 and qualifying under section
501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as
amended through December 31, 1988, or a limited partnership
which corporation or partnership operates the property in
conjunction with a cooperative association, homestead treatment
may be claimed by the cooperative association on behalf of the
members of the cooperative for each dwelling unit occupied by a
member of the cooperative. The cooperative association must
provide the assessor with the social security numbers of those
members. To qualify for the treatment provided by this
subdivision, the following conditions must be met:
(a) the cooperative association must be organized under
chapter 308A and all voting members of the board of directors
must be resident tenants of the cooperative and must be elected
by the resident tenants of the cooperative;
(b) the cooperative association must have a lease for
occupancy of the property for a term of at least 20 years, which
permits the cooperative association, while not in default on the
lease, to participate materially in the management of the
property, including material participation in establishing
budgets, setting rent levels, and hiring and supervising a
management agent;
(c) to the extent permitted under state or federal law, the
cooperative association must have a right under a written
agreement with the owner to purchase the property if the owner
proposes to sell it; if the cooperative association does not
purchase the property it is offered for sale, the owner may not
subsequently sell the property to another purchaser at a price
lower than the price at which it was offered for sale to the
cooperative association unless the cooperative association
approves the sale;
(d) the cooperative must meet one of the following criteria
with respect to the income of its members: (1) a minimum of 75
percent of members must have incomes at or less than 80 percent
of area median income, (2) a minimum of 40 percent of members
must have incomes at or less than 60 percent of area median
income, or (3) a minimum of 20 percent of members must have
incomes at or less than 50 percent of area median income. For
purposes of this clause, "member income" means the income of a
member existing at the time the member acquires his or her
cooperative membership, and "median income" means the St.
Paul-Minneapolis metropolitan area median income as determined
by the United States Department of Housing and Urban
Development;
(e) if a limited partnership owns the property, it must
include as the managing general partner a nonprofit organization
operating under the provisions of chapter 317 and qualifying
under section 501(c)(3) or 501(c)(4) of the Internal Revenue
Code of 1986, as amended through December 31, 1988, and the
limited partnership agreement must provide that the managing
general partner have sufficient powers so that it materially
participates in the management and control of the limited
partnership;
(f) prior to becoming a member of a leasehold cooperative
described in this subdivision, a person must have received
notice that (1) describes leasehold cooperative property in
plain language, including but not limited to the effects of
classification under this subdivision on rents, property taxes
and tax credits or refunds, and operating expenses, and (2)
states that copies of the articles of incorporation and bylaws
of the cooperative association, the lease between the owner and
the cooperative association, a sample sublease between the
cooperative association and a tenant, and, if the owner is a
partnership, a copy of the limited partnership agreement, can be
obtained upon written request at no charge from the owner, and
the owner must send or deliver the materials within seven days
after receiving any request;
(g) if a dwelling unit of a building was occupied on the
60th day prior to the date on which the unit became leasehold
cooperative property described in this subdivision, then (1) the
notice described in paragraph (f) must have been sent by first
class mail to the occupant of the unit at least 60 days prior to
the date on which the unit became leasehold cooperative
property, and (2) prior to the mailing of the notice,. For
purposes of the notice under this paragraph, the copies of the
documents referred to in paragraph (f) may be in proposed
version, provided that any subsequent material alteration of
those documents made after the occupant has requested a copy
shall be disclosed to any occupant who has requested a copy of
the document. Copies of the documents identified in the notice
must have been articles of incorporation and certificate of
limited partnership shall be filed with the secretary of
state after the expiration of the 60-day period unless the
change to leasehold cooperative status does not proceed; and
(h) the county attorney of the county in which the property
is located must certify to the assessor that the property meets
the requirements of this subdivision.
Homestead treatment must be afforded to units occupied by
members of the cooperative association and the units must be
assessed as provided in subdivision 3, provided that any unit
not so occupied shall be classified and assessed pursuant to the
appropriate class. No more than three acres of land may, for
assessment purposes, be included with each dwelling unit that
qualifies for homestead treatment under this subdivision.
Sec. 7. Minnesota Statutes Second 1989 Supplement, section
273.13, subdivision 25, is amended to read:
Subd. 25. [CLASS 4.] (a) Class 4a is residential real
estate containing four or more units and used or held for use by
the owner or by the tenants or lessees of the owner as a
residence for rental periods of 30 days or more. Class 4a also
includes hospitals licensed under sections 144.50 to 144.56,
other than hospitals exempt under section 272.02, and contiguous
property used for hospital purposes, without regard to whether
the property has been platted or subdivided. Class 4a property
has a class rate of 3.6 percent of market value.
(b) Class 4b includes:
(1) residential real estate containing less than four
units, other than seasonal residential, and recreational;
(2) post-secondary student housing not to exceed one acre
of land which is owned by a nonprofit corporation organized
under chapter 317 and is used exclusively by a sorority or
fraternity organization for housing;
(3) manufactured homes not classified under any other
provision;
(4) a dwelling, garage, and surrounding one acre of
property on a nonhomestead farm classified under subdivision 23,
paragraph (b).
Class 4b property has a class rate of 3.0 percent of market
value.
(c) Class 4c property includes:
(1) a structure that is situated on real property that is
used for housing for the elderly or for low and moderate income
families as defined by Title II of the National Housing Act or
the Minnesota housing finance agency law of 1971 or rules
promulgated by the agency pursuant thereto and financed by a
direct federal loan or federally insured loan or a loan made by
the Minnesota housing finance agency pursuant to the provisions
of either of those acts and acts amendatory thereof. This
clause applies only to property of a nonprofit or limited
dividend entity. Property is classified as class 4c under this
clause for 15 years from the date of the completion of the
original construction or substantial rehabilitation, or for the
original term of the loan;
(2) a structure that is:
(i) situated upon real property that is used for housing
lower income families or elderly or handicapped persons, as
defined in section 8 of the United States Housing Act of 1937,
as amended; and
(ii) owned by an entity which has entered into a housing
assistance payments contract under section 8 which provides
assistance for 100 percent of the dwelling units in the
structure, other than dwelling units intended for management or
maintenance personnel. Property is classified as class 4c under
this clause for the term of the housing assistance payments
contract, including all renewals, or for the term of its
permanent financing, whichever is shorter; and
(3) a qualified low-income building that (i) receives a
low-income housing credit under section 42 of the Internal
Revenue Code of 1986, as amended through December 31, 1988; or
(ii) meets the requirements of that section. Classification
pursuant to this clause is limited to buildings the construction
or rehabilitation of which began after May 1, 1988, and to a
term of 15 years.
For all properties described in clauses (1), (2), and (3)
and in paragraph (d), the market value determined by the
assessor must be based on the normal approach to value using
normal unrestricted rents. The land on which these structures
are situated has the class rate given in paragraph (b) if the
structure contains fewer than four units, and the class rate
given in paragraph (a) if the structure contains four or more
units.
(4) a parcel of land, not to exceed one acre, and its
improvements or a parcel of unimproved land, not to exceed one
acre, if it is owned by a neighborhood real estate trust and at
least 60 percent of the dwelling units, if any, on all land
owned by the trust are leased to or occupied by lower income
families or individuals. This clause does not apply to any
portion of the land or improvements used for nonresidential
purposes. For purposes of this clause, a lower income family is
a family with an income that does not exceed 65 percent of the
median family income for the area, and a lower income individual
is an individual whose income does not exceed 65 percent of the
median individual income for the area, as determined by the
United States Secretary of Housing and Urban Development. For
purposes of this clause, "neighborhood real estate trust" means
an entity which is certified by the governing body of the
municipality in which it is located to have the following
characteristics: (a) it is a nonprofit corporation organized
under chapter 317; (b) it has as its principal purpose providing
housing for lower income families in a specific geographic
community designated in its articles or bylaws; (c) it limits
membership with voting rights to residents of the designated
community; and (d) it has a board of directors consisting of at
least seven directors, 60 percent of whom are members with
voting rights and, to the extent feasible, 25 percent of whom
are elected by resident members of buildings owned by the trust;
and
(5) except as provided in subdivision 22, paragraph (c),
real property devoted to temporary and seasonal residential
occupancy for recreation purposes, including real property
devoted to temporary and seasonal residential occupancy for
recreation purposes and not devoted to commercial purposes for
more than 225 days in the year preceding the year of
assessment. For this purpose, property is devoted to commercial
use on a specific day if it is used, or offered for use, and a
fee is charged for the use. Class 4c also includes commercial
use real property used exclusively for recreational purposes in
conjunction with class 4c property devoted to temporary and
seasonal residential occupancy for recreational purposes, up to
a total of two acres, provided the property is not devoted to
commercial recreational use for more than 225 days in the year
preceding the year of assessment and is located within two miles
of the class 4c property with which it is used. Class 4c
property classified in this clause and clause (6) also includes
the remainder of class 1c resorts; and
(6) real property up to a maximum of one acre of land owned
by a nonprofit community service oriented organization; provided
that the property is not used for a revenue-producing activity
for more than six days in the calendar year preceding the year
of assessment and the property is not used for residential
purposes on either a temporary or permanent basis. For purposes
of this clause, a "nonprofit community service oriented
organization" means any corporation, society, association,
foundation, or institution organized and operated exclusively
for charitable, religious, fraternal, civic, or educational
purposes, and which is exempt from federal income taxation
pursuant to section 501(c)(3), (10), or (19) of the Internal
Revenue Code of 1986, as amended through December 31, 1988. For
purposes of this clause, "revenue-producing activities" shall
include but not be limited to property or that portion of the
property that is used as an on-sale intoxicating liquor or
nonintoxicating malt liquor establishment licensed under chapter
340A, a restaurant open to the public, bowling alley, a retail
store, gambling conducted by organizations licensed under
chapter 349, an insurance business, or office or other space
leased or rented to a lessee who conducts a for-profit
enterprise on the premises. Any portion of the property which
is used for revenue-producing activities for more than six days
in the calendar year preceding the year of assessment shall be
assessed as class 3a. The use of the property for social events
open exclusively to members and their guests for periods of less
than 24 hours, when an admission is not charged nor any revenues
are received by the organization shall not be considered a
revenue-producing activity; and
Class 4c property has a class rate of 2.4 percent of market
value.
(d) Class 4d property includes any structure:
(i) situated on real property that is used for housing for
the elderly or for low and moderate income families as defined
by the farmers home administration;
(ii) located in a municipality of less than 10,000
population; and
(iii) financed by a direct loan or insured loan from the
farmers home administration. Property is classified under this
clause for 15 years from the date of the completion of the
original construction or for the original term of the loan.
The class rates in paragraph (c), clauses (1), (2), and (3)
and this clause apply to the properties described in them, only
in proportion to occupancy of the structure by elderly or
handicapped persons or low and moderate income families as
defined in the applicable laws unless construction of the
structure had been commenced prior to January 1, 1984; or the
project had been approved by the governing body of the
municipality in which it is located prior to June 30, 1983; or
financing of the project had been approved by a federal or state
agency prior to June 30, 1983. Classification under this clause
is only available to property of a nonprofit or limited dividend
entity.
Class 4d property has a class rate of 1.7 percent of market
value for taxes payable in 1990, and two percent of market value
for taxes payable thereafter.
(e) Residential rental property that would otherwise be
assessed as class 4 property under paragraph (a); paragraph (b),
clauses (1) and (2); or paragraph (c), clause (1), (2), (3), or
(4); or paragraph (d), is assessed at the class rate applicable
to it under Minnesota Statutes 1988, section 273.13, if it is
found to be a substandard building under section 273.1316.
Residential rental property that would otherwise be assessed as
class 4 property under paragraph (d) is assessed at 2.4 percent
of market value if it is found to be a substandard building
under section 273.1316.
Sec. 8. Minnesota Statutes Second 1989 Supplement, section
273.1391, subdivision 2, is amended to read:
Subd. 2. For taxes payable in 1990 and subsequent years,
the amount of the reduction authorized by subdivision 1 shall be:
(a) In the case of property located within a school
district which does not meet the qualifications of section
273.134 as a tax relief area, but which is located in a county
with a population of less than 100,000 in which taconite is
mined or quarried and wherein a school district is located which
does meet the qualifications of a tax relief area, and provided
that at least 90 percent of the area of the school district
which does not meet the qualifications of section 273.134 lies
within such county, 57 percent of the tax on qualified property
located in the school district that does not meet the
qualifications of section 273.134, provided that the amount of
said reduction shall not exceed the maximum amounts specified in
clause (c), and shall not exceed an amount sufficient to reduce
the effective tax rate on each parcel of property to the product
of 95 percent of the base year effective tax rate multiplied by
the ratio of the current year's tax rate to the payable 1989 tax
rate. In no case will the reduction for each homestead
resulting from this credit be less than $10. The reduction
provided by this clause shall only be applicable to property
located within the boundaries of the county described therein.
(b) In the case of property located within a school
district which does not meet the qualifications of section
273.134 as a tax relief area, but which is located in a school
district in a county containing a city of the first class and a
qualifying municipality, but not in a school district containing
a city of the first class or adjacent to a school district
containing a city of the first class unless the school district
so adjacent contains a qualifying municipality, 57 percent of
the tax, but not to exceed the maximums specified in clause (c),
and shall not exceed an amount sufficient to reduce the
effective tax rate on each parcel of property to the product of
95 percent of the base year effective tax rate multiplied by the
ratio of the current year's tax rate to the payable 1989 tax
rate. In no case will the reduction for each homestead
resulting from this credit be less than $10.
(c) The maximum reduction of the tax up to the taconite
breakpoint is $200.10 for taxes payable in 1985. This maximum
amount shall increase by $15 multiplied by the quantity one
minus the homestead credit equivalency percentage per year for
taxes payable in 1986 and subsequent years.
For the purposes of this subdivision, "homestead credit
equivalency percentage" means one minus the ratio of the net tax
capacity percentage to the gross tax capacity percentage
applicable to the first $68,000 of the market value of
residential homesteads, and "effective tax rate" means tax
divided by the market value of a property, and the "base year
effective tax rate" means the payable 1988 tax on a property
with an identical market value to that of the property receiving
the credit in the current year after application of the credits
payable under Minnesota Statutes 1988, section 273.13,
subdivisions 22 and 23, and this section, divided by the market
value of the property.
Sec. 9. Minnesota Statutes Second 1989 Supplement, section
273.1398, subdivision 1, is amended to read:
Subdivision 1. [DEFINITIONS.] (a) In this section, the
terms defined in this subdivision have the meanings given them.
(b) "Unique taxing jurisdiction" means the geographic area
subject to the same set of tax capacity rates.
(c) "Gross tax capacity" means the product of the gross
class rates and estimated market values. "Total gross tax
capacity" means the gross tax capacities for all property within
the unique taxing jurisdiction. The total gross tax capacity
used shall be reduced by the sum of (1) the unique taxing
jurisdiction's gross tax capacity of commercial industrial
property as defined in section 473F.02, subdivision 3,
multiplied by the ratio determined pursuant to section 473F.08,
subdivision 6, for the municipality, as defined in section
473F.02, subdivision 8, in which the unique taxing jurisdiction
is located, (2) the gross tax capacity of the captured value of
tax increment financing districts as defined in section 469.177,
subdivision 2, and (3) the gross tax capacity of transmission
lines deducted from a local government's total gross tax
capacity under section 273.425. Gross tax capacity cannot be
less than zero.
(d) "Net tax capacity" means the product of the appropriate
net class rates for the year in which the aid is payable, except
that for class 3 utility real and personal property the class
rate applied shall be 5.38 percent, and estimated market values
for the assessment two years prior to that in which aid is
payable. "Total net tax capacity" means the net tax capacities
for all property within the unique taxing jurisdiction. The
total net tax capacity used shall be reduced by the sum of (1)
the unique taxing jurisdiction's net tax capacity of commercial
industrial property as defined in section 473F.02, subdivision
3, multiplied by the ratio determined pursuant to section
473F.08, subdivision 6, for the municipality, as defined in
section 473F.02, subdivision 8, in which the unique taxing
jurisdiction is located, (2) the net tax capacity of the
captured value of tax increment financing districts as defined
in section 469.177, subdivision 2, and (3) the net tax capacity
of transmission lines deducted from a local government's total
net tax capacity under section 273.425. For purposes of
determining the net tax capacity of property referred to in
clauses (1) and (2), the net tax capacity shall be multiplied by
the ratio of the highest class rate for class 3a property for
taxes payable in the year in which the aid is payable to the
highest class rate for class 3a property in the prior year. Net
tax capacity cannot be less than zero.
(e) "Equalized market values" are market values that have
been equalized by dividing the assessor's estimated market value
for the second year prior to that in which the aid is payable by
the assessment sales ratios determined by class in the
assessment sales ratio study conducted by the department of
revenue pursuant to section 124.2131 in the second year prior to
that in which the aid is payable. The equalized market values
shall equal the unequalized market values divided by the
assessment sales ratio.
(f) "Local tax rate" means the quotient derived by dividing
the gross taxes levied within a unique taxing jurisdiction for
taxes payable in 1989 by the gross tax capacity of the unique
taxing jurisdiction for taxes payable in 1989. For computation
of the local tax rate for aid payable in 1991 and subsequent
years, gross taxes for taxes payable in 1989 exclude equalized
levies as defined in subdivision 2a. For purposes of
computation of the local tax rate only, gross taxes shall not be
adjusted by inflation or household growth.
(g) For purposes of calculating the homestead and
agricultural credit aid authorized pursuant to subdivision 2,
the "subtraction factor" is the product of (i) a unique taxing
jurisdiction's local tax rate; (ii) its total net tax capacity;
and (iii) 0.9767.
(h) For purposes of calculating and allocating homestead
and agricultural credit aid authorized pursuant to subdivision 2
and the disparity reduction aid authorized in subdivision 3,
"gross taxes levied on all properties" or "gross taxes" means
the total gross taxes levied on all properties except that
levied on the captured value of tax increment districts as
defined in section 469.177, subdivision 2, and that levied on
the portion of commercial industrial properties' assessed value
or gross tax capacity, as defined in section 473F.02,
subdivision 3, subject to the areawide tax as provided in
section 473F.08, subdivision 6, in a unique taxing jurisdiction
before reduction by any credits for taxes payable in 1989.
Gross taxes are before any reduction for disparity reduction
aid. Gross taxes levied cannot be less than zero.
For homestead and agricultural credit aid payable in 1991
and subsequent years, "gross taxes" or "gross taxes levied on
all properties" shall mean gross taxes payable in 1989,
excluding taxes defined as "equalized levies" actual amounts
levied for the purposes listed in subdivision 2a, multiplied by
the cost-of-living adjustment factor and the household
adjustment factor.
(i) "Human services aids" means:
(1) aid to families with dependent children under sections
256.82, subdivision 1, and 256.935, subdivision 1;
(2) medical assistance under sections 256B.041, subdivision
5, and 256B.19, subdivision 1;
(3) general assistance medical care under section 256D.03,
subdivision 6;
(4) general assistance under section 256D.03, subdivision
2;
(5) work readiness under section 256D.03, subdivision 2;
(6) emergency assistance under section 256.871, subdivision
6;
(7) Minnesota supplemental aid under section 256D.36,
subdivision 1;
(8) preadmission screening and alternative care grants
under section 256B.091;
(9) work readiness services under section 256D.051;
(10) case management services under section 256.736,
subdivision 13;
(11) general assistance claims processing, medical
transportation and related costs; and
(12) medical assistance, medical transportation and related
costs.
(j) "Adjustment factor" means one plus the percentage
change in (1) the ratio of estimated market value of residential
homesteads property to the estimated market value of all taxable
property within the city or township containing the unique
taxing jurisdiction based on the assessment one year prior to
the year in which the aid is payable when compared to the same
ratio based on the assessment two years prior to the year in
which the aid is payable. If the market value of farm
homesteads exceeds the market value of residential homesteads in
the city or township containing the unique taxing
jurisdiction for the assessment two years prior to the year in
which the aid is payable, "adjusted adjustment factor" means one
plus the percentage change in the ratio of the estimated market
value of farm homesteads property to the estimated market value
of all taxable property within the city or township containing
the unique taxing jurisdiction based on the assessment one year
prior to the year in which the aid is payable when compared to
the same ratio based on the assessment two years prior to the
year in which the aid is payable. The adjustment factor cannot
be less than one. Estimates of market value for the assessment
one year prior to the year in which the aid is paid will be made
on the basis of the abstract submitted pursuant to section
270.11. Discrepancies between the estimate and actual market
values will not result in increased or decreased aid in the year
in which the estimates are used to compute aid.
(k) "Cost-of-living adjustment factor" means one plus the
percentage, if any, by which:
(1) the consumer price index for the calendar year
preceding that in which aid is payable, exceeds
(2) the consumer price index for calendar year 1989.
(l) "Consumer price index for any calendar year" means the
average of the consumer price index as of the close of the
12-month period ending on May 31 of such calendar year.
(m) "Consumer price index" means the last consumer price
index for all-urban consumers published by the department of
labor. For purposes of the preceding sentence, the revision of
the consumer price index which is most consistent with the
consumer price index for calendar year 1989 shall be used.
(n) "Household adjustment factor" means the number of
households for the most recent year preceding that in which the
aids are payable divided by the 1988 number of households. The
household adjustment factor cannot be less than one.
Sec. 10. Minnesota Statutes Second 1989 Supplement,
section 273.1398, subdivision 2, is amended to read:
Subd. 2. [HOMESTEAD AND AGRICULTURAL CREDIT AID.] (a)
Initial homestead and agricultural credit aid for each unique
taxing jurisdiction equals the total gross taxes levied on all
properties, minus the unique taxing jurisdiction's subtraction
factor. The commissioner of revenue may, in computing the
amount of the homestead and agricultural credit aid paid in
1990, adjust the gross tax capacity, net tax capacity, and gross
taxes of a taxing jurisdiction for taxes payable in 1989 to
reflect auditor's errors in computing taxes payable for 1989 in
unique taxing jurisdictions within independent school district
Nos. 720 and 792. Homestead and agricultural credit aid cannot
be less than zero.
(b)(1) The homestead and agricultural credit aid is
allocated to each local government levying taxes in the unique
taxing jurisdiction in the proportion that the local
government's gross taxes bears to the total gross taxes levied
within the unique taxing jurisdiction.
(2) The 1990 homestead and agricultural credit aid so
determined for school districts for purposes of general
education levies pursuant to section 124A.23, subdivisions 2 and
2a, and transportation levies pursuant to section 275.125,
subdivisions 5 and 5c, shall be multiplied by the ratio of the
adjusted gross tax capacity based upon the 1988 adjusted gross
tax capacity to the estimated 1987 adjusted gross tax capacity
based upon the 1987 adjusted assessed value.
(3) If a local government's total tax capacity rate for all
funds for taxes payable in 1989 varies within the area in which
it exercises taxing authority, the local government's allocated
homestead and agricultural credit aid must be further allocated
between the part of its levy in respect to which the tax
capacity rate is constant throughout the area in which it
exercises taxing authority and the part of its levy in respect
to which the tax capacity rate varies throughout the area in
which it exercises taxing authority.
(c) The calendar year 1990 homestead and agricultural
credit aid shall be adjusted by the adjustment factor.
(d) Payments under this subdivision to counties in 1990 and
subsequent years shall be reduced by the amount provided in
section 477A.012, subdivisions 3, paragraph (d), and 4,
paragraph (d).
(e) Payments under this subdivision to cities and towns
shall be annually reduced by the amount of the homestead and
agricultural credit aid adjustment, if any, determined for 1990
under section 477A.013, subdivision 6.
Sec. 11. Minnesota Statutes Second 1989 Supplement,
section 273.1398, subdivision 5, is amended to read:
Subd. 5. [ADDITIONAL HOMESTEAD AND AGRICULTURAL CREDIT
GUARANTEE.] Beginning with taxes payable in 1990, each unique
taxing jurisdiction may receive additional homestead and
agricultural credit guarantee payments.
(1) Each year, the commissioner shall determine the total
education aids paid under chapters 124 and 124A, homestead and
agricultural credit aid and disparity reduction aid paid under
section 273.1398, local government aid to cities, counties, and
towns paid under chapter 477A, and income maintenance aid human
services aids, including for aids paid in 1991 and thereafter,
the amount paid under subdivision 5b, paid to counties for each
taxing jurisdiction. The commissioner shall apportion each
local government's aids to the unique taxing jurisdiction based
upon the proportion that the unique taxing jurisdiction's tax
capacity bears to the total tax capacity of the local government.
(2) Each year, the commissioner will compute a gross tax
capacity rate for each taxing jurisdiction equal to its total
levy divided by its gross tax capacity under Minnesota Statutes
1988, section 273.13. For each unique taxing jurisdiction, a
total gross tax capacity rate will be determined. This total
gross tax capacity rate will be applied against the gross tax
capacity of property that would have been eligible for the
homestead credit or the agricultural credit for taxes payable in
1989. An estimated credit amount will be determined for all
qualifying parcels based upon the credit rate structure in
effect for taxes payable in 1989. The resulting credit amounts
will be summed for all parcels in the unique taxing jurisdiction.
If the amount determined in clause (2) is greater than the
amount determined in clause (1), the difference will be
additional homestead and agricultural credit guarantee payments
for the unique taxing jurisdiction. The additional credit
amount shall proportionately reduce the tax capacity rates of
all local governments levying taxes within the unique taxing
jurisdiction in the following year. The commissioner shall
certify the amounts of additional credits determined under this
subdivision to the county auditor at the time provided in
subdivision 6.
Sec. 12. Minnesota Statutes Second 1989 Supplement,
section 273.1398, subdivision 5a, is amended to read:
Subd. 5a. [AID ADJUSTMENT FOR COUNTY HUMAN SERVICES AID.]
(a) There shall be transferred to the human services aid account
from the payment to a county under subdivision 2 an amount
representing a county's human services aid increase as
calculated in subdivision 5b, paragraphs (a) to (c). The amount
calculated for each county shall be deducted from the first
payment to the equally from the July and December payments to
the county under this section in 1991 and subsequent years. If
the deduction exceeds the amount of the first payment, the
balance shall be subtracted from the second payment. The amount
of the payments under subdivision 2 shall not be less than zero
as a result of this adjustment.
Sec. 13. Minnesota Statutes Second 1989 Supplement,
section 273.1398, subdivision 6, is amended to read:
Subd. 6. [PAYMENT.] The commissioner shall certify the
aids provided in subdivisions 2, 2b, 3, and 5 before December 1,
1989, and October 1 thereafter of the year preceding the
distribution year to the county auditor of the affected local
government and pay them and the credit reimbursements to local
governments other than school districts at the times provided in
section 477A.015 for payment of local government aid to taxing
jurisdictions. Aids and credit reimbursements to school
districts must be certified to the commissioner of education and
paid under section 273.1392. Except for education districts and
secondary cooperatives that receive revenue according to section
124.2721 or 124.575, payment shall not be made to any taxing
jurisdiction that has ceased to levy a property tax nor shall
homestead and agricultural credit aid be payable on the part of
a levy to which homestead and agricultural credit aid was
separately allocated under subdivision 2, paragraph (b), clause
(2), which is no longer levied.
Sec. 14. Minnesota Statutes 1988, section 274.01,
subdivision 1, is amended to read:
Subdivision 1. [ORDINARY BOARD; MEETINGS, DEADLINES,
GRIEVANCES.] (a) The town board of a town, or the council or
other governing body of a city, is the board of review except in
cities whose charters provide for a board of equalization. The
county assessor shall fix a day and time when the board or the
board of equalization shall meet in the assessment districts of
the county. On or before February 15 of each year the assessor
shall give written notice of the time to the city or town
clerk. Notwithstanding the provisions of any charter to the
contrary, the meetings must be held between April 1 and May 31
each year. The clerk shall give published and posted notice of
the meeting at least ten days before the date of the meeting.
The board shall meet at the office of the clerk to review the
assessment and classification of property in the town or city.
No changes in valuation or classification which are intended to
correct errors in judgment by the county assessor may be made by
the county assessor after the board of review or the county
board of equalization has adjourned; however, corrections of
errors that are merely clerical in nature or changes that extend
homestead treatment to property are permitted after the board of
review or the county board of equalization has adjourned. This
restriction does not apply to corrections of errors that are
merely clerical or administrative in nature adjournment until
the tax extension date for that assessment year. The changes
must be fully documented and maintained in the assessor's office
and must be available for review by any person. A copy of the
changes made during this period must be sent to the county board
no later than December 31 of the assessment year.
(b) The board shall determine whether the taxable property
in the town or city has been properly placed on the list and
properly valued by the assessor. If real or personal property
has been omitted, the board shall place it on the list with its
market value, and correct the assessment so that each tract or
lot of real property, and each article, parcel, or class of
personal property, is entered on the assessment list at its
market value. No assessment of the property of any person may
be raised unless the person has been duly notified of the intent
of the board to do so. On application of any person feeling
aggrieved, the board shall review the assessment or
classification, or both, and correct it as appears just.
(c) A local board of review may reduce assessments upon
petition of the taxpayer but the total reductions must not
reduce the aggregate assessment made by the county assessor by
more than one percent. If the total reductions would lower the
aggregate assessments made by the county assessor by more than
one percent, none of the adjustments may be made. The assessor
shall correct any clerical errors or double assessments
discovered by the board of review without regard to the one
percent limitation.
(d) A majority of the members may act at the meeting, and
adjourn from day to day until they finish hearing the cases
presented. The assessor shall attend, with the assessment books
and papers, and take part in the proceedings, but must not
vote. The county assessor, or an assistant delegated by the
county assessor shall attend the meetings. The board shall list
separately, on a form appended to the assessment book, all
omitted property added to the list by the board and all items of
property increased or decreased, with the market value of each
item of property, added or changed by the board, placed opposite
the item. The county assessor shall enter all changes made by
the board in the assessment book.
(e) If a person fails to appear in person, by counsel, or
by written communication before the board after being duly
notified of the board's intent to raise the assessment of the
property, or if a person feeling aggrieved by an assessment or
classification fails to apply for a review of the assessment or
classification, the person may not appear before the county
board of equalization for a review of the assessment or
classification. This paragraph does not apply if an assessment
was made after the board meeting, as provided in section 273.01,
or if the person can establish not having received notice of
market value at least five days before the local board of review
meeting.
(f) The board of review or the board of equalization must
complete its work and adjourn within 20 days from the time of
convening stated in the notice of the clerk, unless a longer
period is approved by the commissioner of revenue. No action
taken after that date is valid. All complaints about an
assessment or classification made after the meeting of the board
must be heard and determined by the county board of
equalization. A nonresident may, at any time, before the
meeting of the board of review file written objections to an
assessment or classification with the county assessor. The
objections must be presented to the board of review at its
meeting by the county assessor for its consideration.
Sec. 15. Minnesota Statutes Second 1989 Supplement,
section 274.14, is amended to read:
274.14 [LENGTH OF SESSION; RECORD.]
The county board of equalization or the special board of
equalization appointed by it shall meet during the last two
weeks in June that contain ten meeting days, excluding Saturday
and Sunday. No action taken by the county board of review after
June 30 is valid, except for corrections permitted in sections
273.01 and 274.01. The county auditor shall keep an accurate
record of the proceedings and orders of the board. The record
must be published like other proceedings of county
commissioners. A copy of the published record must be sent to
the commissioner of revenue, with the abstract of assessment
required by section 274.16.
Sec. 16. Minnesota Statutes Second 1989 Supplement,
section 274.175, is amended to read:
274.175 [VALUES FINALIZED.]
The assessments recorded by the county assessor and the
county auditor under sections 273.124, subdivision 9; 274.16;
274.17; or other law for real and personal property are final on
July 1 of the assessment year, except for property added to the
assessment rolls under section 272.02, subdivision 4, or deleted
because of tax forfeiture pursuant to chapter 281. No changes
in value may be made after July 1 of the assessment year, except
for corrections permitted in sections 273.01 and 274.01.
Sec. 17. Minnesota Statutes Second 1989 Supplement,
section 275.07, subdivision 3, is amended to read:
Subd. 3. The county auditor shall adjust each local
government's levy certified under subdivision 1 by the amount of
homestead and agricultural credit aid certified by section
273.1398, subdivision 2, reduced by the amount under section
273.1398, subdivision 5a, and equalization aid certified by
section 477A.013, subdivision 5. If a local government's
homestead and agricultural credit aid was further allocated
between portions of its levy pursuant to section 273.1398,
subdivision 2, paragraph (b)(2), the levy or fund to which the
homestead and agricultural credit aid was allocated is the levy
or fund which must be adjusted.
Sec. 18. Minnesota Statutes Second 1989 Supplement,
section 275.50, subdivision 5, is amended to read:
Subd. 5. Notwithstanding any other law to the contrary for
taxes levied in 1989 payable in 1990 and subsequent years,
"special levies" means those portions of ad valorem taxes levied
by governmental subdivisions to:
(a) for taxes levied in 1990, payable in 1991 and
subsequent years, pay the costs not reimbursed by the state or
federal government, of payments made to or on behalf of
recipients of aid under any public assistance program authorized
by law, and the costs of purchase or delivery of social
services. The aggregate amounts levied under this clause for
the costs of purchase or delivery of social services and income
maintenance programs, other than those identified in section
273.1398, subdivision 1, paragraph (i), are subject to a maximum
increase over the amount levied for the previous year of 12
percent for counties within the metropolitan area as defined in
section 473.121, subdivision 2, or counties outside the
metropolitan area but containing a city of the first class, and
15 percent for other counties. For purposes of this clause,
"income maintenance programs" include income maintenance
programs in section 273.1398, subdivision 1, paragraph (i), to
the extent the county provides benefits under those programs
over the statutory mandated standards. Effective with taxes
levied in 1990, the portion of this special levy for human
service programs identified in section 273.1398, subdivision 1,
paragraph (i), is eliminated;
(b) pay the costs of principal and interest on bonded
indebtedness except on bonded indebtedness issued under section
471.981, subdivisions 4 to 4c, or to reimburse for the amount of
liquor store revenues used to pay the principal and interest due
in the year preceding the year for which the levy limit is
calculated on municipal liquor store bonds;
(c) pay the costs of principal and interest on certificates
of indebtedness, except tax anticipation or aid anticipation
certificates of indebtedness, issued for any corporate purpose
except current expenses or funding an insufficiency in receipts
from taxes or other sources or funding extraordinary
expenditures resulting from a public emergency; and to pay the
cost for certificates of indebtedness issued pursuant to
sections 298.28 and 298.282;
(d) fund the payments made to the Minnesota state armory
building commission pursuant to section 193.145, subdivision 2,
to retire the principal and interest on armory construction
bonds;
(e) provide for the bonded indebtedness portion of payments
made to another political subdivision of the state of Minnesota;
(f) pay the amounts required, in accordance with section
275.075, to correct for a county auditor's error of omission but
only to the extent that when added to the preceding year's levy
it is not in excess of an applicable statutory, special law or
charter limitation, or the limitation imposed on the
governmental subdivision by sections 275.50 to 275.56 in the
preceding levy year;
(g) pay amounts required to correct for an error of
omission in the levy certified to the appropriate county auditor
or auditors by the governing body of a city or town with
statutory city powers in a levy year, but only to the extent
that when added to the preceding year's levy it is not in excess
of an applicable statutory, special law or charter limitation,
or the limitation imposed on the governmental subdivision by
sections 275.50 to 275.56 in the preceding levy year;
(h) pay amounts required by law to be paid to pay the
interest on and to reduce the unfunded accrued liability of
public pension funds in accordance with the actuarial standards
and guidelines specified in sections 356.215 and 356.216 reduced
by 106 percent of the amount levied for that purpose in 1976,
payable in 1977. For the purpose of this special levy, the
estimated receipts expected from the state of Minnesota pursuant
to sections 69.011 to 69.031 or any other state aid expressly
intended for the support of public pension funds shall be
considered as a deduction in determining the required levy for
the normal costs of the public pension funds. No amount of
these aids shall be considered as a deduction in determining the
governmental subdivision's required levy for the reduction of
the unfunded accrued liability of public pension funds;
(i) to compensate the state for the cost of a reassessment
ordered by the commissioner of revenue pursuant to section
270.16;
(j) pay the debt service on tax increment financing revenue
bonds to the extent that revenue to pay the bonds or to maintain
reserves for the bonds is insufficient as a result of the
provisions of Laws 1988, chapter 719, article 5;
(k) pay the cost of hospital care under section 261.21;
(l) pay the unreimbursed costs incurred in the previous
year to satisfy judgments rendered against the governmental
subdivision by a court of competent jurisdiction in any tort
action, or to pay the costs of settlements out of court against
the governmental subdivision in a tort action when substantiated
by a stipulation for the dismissal of the action filed with the
court of competent jurisdiction and signed by both the plaintiff
and the legal representative of the governmental subdivision,
provided that an appeal for the unreimbursed costs under this
clause was approved by the commissioner of revenue under section
275.51, subdivision 3;
(m) pay the expenses reasonably and necessarily incurred in
preparing for or repairing the effects of natural disaster
including the occurrence or threat of widespread or severe
damage, injury, or loss of life or property resulting from
natural causes such as earthquake, fire, flood, wind storm, wave
action, oil spill, water contamination, air contamination, or
drought in accordance with standards formulated by the emergency
services division of the state department of public safety,
provided that an appeal for the expenses incurred under this
clause were approved by the commissioner of revenue under
section 275.51, subdivision 3;
(n) pay a portion of the losses in tax receipts to a city
due to tax abatements or court actions in the year preceding the
current levy year, provided that an appeal for the tax losses
was approved by the commissioner of revenue under section
275.51, subdivision 3. This special levy is limited to the
amount of the losses times the ratio of the nonspecial levies to
total levies for taxes payable in the year the abatements were
granted. County governments are not authorized to claim this
special levy;
(o) pay the operating cost of regional library services
authorized under section 134.34, subject to a maximum increase
over the previous year of the greater of (1) 103 percent
multiplied by one plus the percentage increase determined for
the governmental subdivision under section 275.51, subdivision
3h, clause (b), or (2) six percent. If a governmental
subdivision elected to include some or all of its levy for
libraries within its adjusted levy limit base in the prior year,
but elects to claim the levy as a special levy in the current
levy year, the allowable increase is determined by applying the
greater percentage determined under clause (1) or (2) to the
total amount levied for libraries in the prior levy year. After
levy year 1989, the increase must not be determined using a base
amount other than the amount that could have been levied as a
special levy in the prior year. In no event shall the special
levy be less than the minimum levy required under sections
134.33 and 134.34, subdivisions 1 and 2;
(p) pay the amount of the county building fund levy
permitted under section 373.40, subdivision 6;
(q) pay the county's share of the costs levied in 1989,
1990, and 1991 for the Minnesota cooperative soil survey under
Minnesota Statutes 1988, section 40.07, subdivision 15;
(r) for taxes levied in 1989, payable in 1990 only, pay the
cost incurred for the minimum share required by counties levying
for the first time under section 134.34 as required under
section 134.341. For taxes levied in 1990, and thereafter,
counties levying under this provision must levy under clause
(o), and their allowable increase must be determined with
reference to the amount levied in 1989 under this paragraph;
(s) for taxes levied in 1989, payable in 1990 only, provide
an amount equal to 50 percent of the estimated amount of the
reduction in aids to a county under sections 273.1398,
subdivision 2, paragraph (d), and 477A.012, subdivision 3, for
aids payable in 1990;
(t) for taxes levied in 1990 only by a county in the eighth
judicial district, provide an amount equal to the amount of the
levy, if any, that is required under Laws 1989, chapter 335,
article 3, section 54, subdivision 8;
(u) for taxes levied in 1989, payable in 1990 only, pay the
costs not reimbursed by the state or federal government:
(i) for the costs of purchase or delivery of social
services. The aggregate amounts levied under this item are
subject to a maximum increase over the amount levied in the
previous year of 12 percent for counties within the metropolitan
area as defined in section 473.121, subdivision 2, or counties
outside the metropolitan area but containing a city of the first
class, and 15 percent for other counties.
(ii) for payments made to or on behalf of recipients of aid
under any public assistance program authorized by law. The
aggregate amounts levied under this item are subject to a
maximum increase over the amount levied in the previous year of
12 percent and must be used only for the public assistance
programs; and.
If the amount levied under this paragraph (u) in 1989 is
less than the actual expenditures needed for these programs for
1990, the difference between the actual expenditures and the
amount levied may be levied in 1990 as a special levy. If the
amount levied in 1989 is greater than the actual expenditures
needed for these programs for 1990, the difference between the
amount levied and the actual expenditures shall be deducted from
the 1990 levy limit, payable in 1991; and
(v) pay an amount of up to 25 percent of the money sought
for distribution and approved under section 115A.557,
subdivision 3, paragraph (b), clause (3).
If the amount levied in 1989 is less than the actual
expenditures needed for these programs for 1990, the difference
between the actual expenditures and the amount levied may be
levied in 1990 as a special levy. If the amount levied in 1989
is greater than the actual expenditures needed for these
programs for 1990, the difference between the amount levied and
the actual expenditures shall be deducted from the 1990 levy
limit, payable in 1991.
Sec. 19. Minnesota Statutes Second 1989 Supplement,
section 275.51, subdivision 3f, is amended to read:
Subd. 3f. [LEVY LIMIT BASE.] (a) The property tax levy
limit base for governmental subdivisions for taxes levied in
1988 shall be equal to the total actual levy for taxes payable
in 1988 with additions and subtractions as specified in
paragraphs (b) and (c).
(b) The amounts to be added to the actual 1988 levy are (1)
the amount of local government aid the governmental subdivision
was certified to receive in 1988 under sections 477A.011 to
477A.014, (2) its 1988 taconite aids under sections 298.28 and
298.282, and (3) its 1988 wetlands and native prairie
reimbursements under Minnesota Statutes 1986, sections 273.115,
subdivision 3, and 273.116, subdivision 3.
(c) The amounts to be subtracted from the actual 1988 levy
are (1) any special levies claimed for taxes payable in 1988
pursuant to Laws 1987, chapter 268, article 5, section 12,
subdivision 4, clauses (1), (2), (3), and (4); and (2) for a
governmental subdivision participating in a regional library
system receiving grants from the department of education under
section 134.34, the amount levied for taxes payable in 1988 for
the operating costs of a public library service.
(d) For taxes levied in 1989 and subsequent years, a
governmental subdivision's levy limit base is equal to its
adjusted levy limit base for the preceding year, provided that
for taxes levied in 1989, the amount of the administrative
reimbursement aid received in 1988 shall be added to the base.
(e) For taxes levied by a county in 1989, the levy limit
base determined under paragraph (d) shall be reduced by an
amount equal to 90 percent of the cost of public defender
services for felonies and gross misdemeanors and the costs of
law clerks in the county that are assumed by the state during
calendar year 1990, less 103 percent of one-half the amount of
fees collected by the courts in the county during calendar year
1988. For taxes levied in 1990, the levy limit base determined
under paragraph (d) shall first be increased by the product of
(1) the amount deducted under this paragraph for taxes levied in
1989 and (2) the adjustments under subdivision 3h, paragraphs
(a) and (b) for taxes levied in 1989, and then shall be reduced
by an amount equal to the cost of public defender services for
felonies and gross misdemeanors and the cost of law clerks in
the county that are assumed by the state during calendar year
1991, less the amount of fees collected by the courts in the
county during calendar year 1989, computed at the rate of $30
for civil and probate filings and $20 for marriage dissolutions.
(f) For taxes levied in 1989 only, by a county that is
located in the eighth judicial district, the levy limit base
determined under paragraphs (d) and (e) shall be further reduced
by an amount equal to 90 percent of the cost of operation of the
trial courts in the county during calendar year 1990 that are
assumed by the state and for which an appropriation is provided,
less 103 percent of the sum of (1) the remaining one-half of the
amount of fees and (2) 100 percent of the amount of fines
collected by the courts in the county during calendar year
1988. For taxes levied in 1990 only by those counties, the levy
limit base determined under paragraphs (d) and (e) shall first
be increased by the product of (1) the amount deducted under
this paragraph for taxes levied in 1989 and (2) the adjustments
under subdivision 3h, paragraphs (a) and (b) for taxes levied in
1989, and then shall be further reduced by an amount equal to
the cost of operation of the trial courts in the county during
the first six months of calendar year 1991 that are assumed by
the state less 50 percent of the amount of fines collected by
the courts during calendar year 1989.
(g) By October 15, 1989, the board of public defense shall
determine and certify to the commissioner of revenue the pro
rata share for each county of the state-financed public defense
services described in paragraph (e) during the six-month period
beginning July 1, 1990. By October 15, 1989, the supreme court
shall determine and certify to the department of revenue for
each county the pro rata share for each county of the cost of
providing law clerks during the three-month period beginning
October 1, 1990, plus, for each county located in the eighth
judicial district, the cost of operation of the trial courts
during calendar year 1990.
By July 15, 1990, the board of public defense shall
determine and certify to the department of revenue the pro rata
share for each county of the state-financed public defense
services described in paragraph (e) during calendar year 1991.
By July 15, 1990, the supreme court shall determine and certify
to the department of revenue for each county the pro rata share
for each county of the cost of providing law clerks during
calendar year 1991 plus, for each county located in the eighth
judicial district, the cost of operation of the trial courts
during the first six months of 1991.
(h) For taxes levied in a county in 1991, the levy limit
base shall be reduced by an amount equal to the cost in the
county of court reporters, judicial officers, and district court
referees and the expenses of law clerks and court reporters as
authorized in sections 484.545, subdivision 3, and 486.05,
subdivisions 1 and 1a, as certified by the supreme court
pursuant to section 477A.012, subdivision 4.
(i) If a governmental subdivision received an adjustment to
its levy limit base for taxes levied in 1988 under section
275.51, subdivision 3j, its levy limit base for taxes levied in
1989 must be reduced by the lesser of (1) the adjustment under
section 275.51, subdivision 3j, or (2) the difference between
its (i) levy limit for taxes levied in 1988 and its (ii) total
actual levy for taxes levied in 1988 minus any special levies
claimed for taxes levied in 1988 under section 275.50,
subdivision 5.
Sec. 20. Minnesota Statutes Second 1989 Supplement,
section 275.51, subdivision 3h, is amended to read:
Subd. 3h. [ADJUSTED LEVY LIMIT BASE.] For taxes levied in
1989 and thereafter, the adjusted levy limit base is equal to
the levy limit base computed pursuant to subdivision 3f,
increased by:
(a) three percent for taxes levied in 1989 and subsequent
years;
(b) a percentage equal to (1) one-half of the greater of
the percentage increases in population or in number of
households, if any, for cities and towns and (2) the lesser of
the percentage increase in population or the number of
households, if any, for counties, using figures derived pursuant
to subdivision 6;
(c) the amount of a permanent increase in the levy limit
base approved at a general or special election held during the
12-month period ending September 30 four working days after
December 20 of the levy year under section 275.58, subdivisions
1 and 2;
(d) for levy year 1989, for a county which incurred costs
since October 1978, for the litigation of federal land claims
under United States Code, title 18, section 1162; United States
Code, title 25, section 331; and United States Code, title 28,
section 1360; an amount of up to the actual costs incurred by
the county for this purpose. This adjustment shall not exceed
$250,000;
(e) for levy year 1989, an amount of $1,724,000 for Ramsey
county for implementing the local government pay equity act
under sections 471.991 to 471.999. Furthermore, in levy years
1990 and 1991, an additional amount of $862,000 shall be added
to Ramsey county's adjusted levy limit base under this clause
for each of the two years; and
(f) for levy year 1989, an amount equal to the decrease in
a county's 50 percent share of the powerline taxes extended
between taxes payable years 1988 and 1989 under section 273.42,
subdivision 1. The adjustment shall be determined by the
department of revenue.
For taxes levied in 1989, the adjusted levy limit base is
reduced by an amount equal to the estimated amount of the
reduction in aids to a county under sections 273.1398,
subdivision 2, paragraph (d), and 477A.012, subdivision 3, for
aids payable in 1990.
Sec. 21. Minnesota Statutes Second 1989 Supplement,
section 275.51, subdivision 6, is amended to read:
Subd. 6. [POPULATION AND HOUSEHOLD ESTIMATES.] For the
purpose of determining the amount of tax that a governmental
subdivision may levy in accordance with limitation established
by this chapter, the population or the number of households of
the governmental subdivision shall be that established by the
last federal census, by a census taken pursuant to section
275.14, or by an estimate made by the metropolitan council, or
by the state demographer made pursuant to section 116K.04,
subdivision 4, whichever is the most recent as to the stated
date of count or estimate, for the calendar year preceding the
current levy year. If the area included in a governmental
subdivision has increased due to annexation in the 12 months
prior to the most recent population estimate for the calendar
year preceding the current levy year and the adjusted levy limit
base is modified under section 275.54, subdivision 3, the
percentage increases in population and households determined in
subdivision 3h are to be based on the change in population and
number of households in the area included in the governmental
subdivision before the annexation.
Sec. 22. Minnesota Statutes 1988, section 275.54, is
amended to read:
275.54 [CONSOLIDATION AND ANNEXATION OF GOVERNMENTAL
SUBDIVISIONS.]
Subdivision 1. If all or part of the area included within
two or more governmental subdivisions is consolidated, merged,
or otherwise combined to constitute a single governmental
subdivision, and differing limitations upon the amount of tax
levy per capita apply to the governmental subdivisions from
which the consolidated, merged, or otherwise combined
governmental subdivision was formed, the limitation applicable
to the surviving entity for purposes of sections 275.50 to
275.56 shall be equal to the highest limitation applicable to
any one of the constituent subdivisions prior to the
consolidation, merger or other combination.
Subd. 2. If a function or service of one governmental
subdivision is transferred to another governmental subdivision,
the levy limitations established by Extra Session Laws 1971,
chapter 31, shall be adjusted by the commissioner of revenue in
such manner so as to fairly and equitably reflect the reduced or
increased property tax burdens of such subdivisions resulting
from such transfer. The aggregate of the adjusted limitations
shall not exceed the aggregate of such limitations prior to
adjustment.
Subd. 3. [ADJUSTMENTS AFTER ANNEXATION.] If the area
included within the governmental subdivision is increased due to
annexation in the 12 months prior to the most recent population
estimate for the calendar year preceding the current levy year
and the state demographer prepares a population estimate for the
annexed area under section 116K.04, subdivision 4, paragraph
(11), the governmental subdivision's adjusted levy limit base
under section 275.51, subdivision 3h, must be adjusted in the
following manner:
(a) A percentage will be calculated equal to the percentage
increase in population in the governmental subdivision due to
annexation determined by dividing the population of the annexed
area by the population of the governmental subdivision excluding
the annexed area, using population estimates for the calendar
year preceding the current levy year.
(b) The governmental subdivision's adjusted levy limit base
under section 275.51, subdivision 3h, after giving effect to
paragraphs (a) and (b) of subdivision 3h, but before any other
paragraphs in section 275.51, subdivision 3h, shall be increased
by the percentage calculated in paragraph (a) of this
subdivision.
For purposes of section 275.51, subdivision 3f, the term
"adjusted levy limit base" includes the adjustment made under
this subdivision for the preceding year.
Sec. 23. Minnesota Statutes 1988, section 287.21,
subdivision 2, is amended to read:
Subd. 2. The proceeds of the taxes levied and collected
under sections 287.21 to 287.36 on or after July 1, 1985, shall
be credited apportioned, 97 percent to the county revenue
general fund of the state, and three percent to the county
revenue fund.
Sec. 24. Minnesota Statutes Second 1989 Supplement,
section 287.29, subdivision 1, is amended to read:
Subdivision 1. On or before the tenth day of each month,
the county treasurer shall determine and pay to the commissioner
of revenue for deposit in the state treasury and credit to the
general fund the state's portion of the receipts from the sale
of documentary stamps during the preceding month. The county
treasurer shall provide any related reports requested by the
commissioner of revenue.
Sec. 25. Minnesota Statutes 1989 Supplement, section
298.28, subdivision 4, is amended to read:
Subd. 4. [SCHOOL DISTRICTS.] (a) 27.5 cents per taxable
ton plus the increase provided in paragraph (d) must be
allocated to qualifying school districts to be distributed,
based upon the certification of the commissioner of revenue,
under paragraphs (b) and (c).
(b) 5.5 cents per taxable ton must be distributed to the
school districts in which the lands from which taconite was
mined or quarried were located or within which the concentrate
was produced. The distribution must be based on the
apportionment formula prescribed in subdivision 2.
(c)(i) 22 cents per taxable ton, less any amount
distributed under paragraph (e), shall be distributed to a group
of school districts comprised of those school districts in which
the taconite was mined or quarried or the concentrate produced
or in which there is a qualifying municipality as defined by
section 273.134 in direct proportion to school district indexes
as follows: for each school district, its pupil units
determined under section 124.17 for the prior school year shall
be multiplied by the ratio of the average adjusted net tax
capacity per pupil unit for school districts receiving aid under
this clause as calculated pursuant to chapter 124A for the
school year ending prior to distribution to the adjusted net tax
capacity per pupil unit of the district. Each district shall
receive that portion of the distribution which its index bears
to the sum of the indices for all school districts that receive
the distributions.
(ii) Notwithstanding clause (i), each school district that
receives a distribution under sections 298.018; 298.23 to
298.28, exclusive of any amount received under this clause;
298.34 to 298.39; 298.391 to 298.396; 298.405; or any law
imposing a tax on severed mineral values that is less than the
amount of its levy reduction under section 275.125, subdivision
9, for the second year prior to the year of the distribution
shall receive a distribution equal to the difference; the amount
necessary to make this payment shall be derived from
proportionate reductions in the initial distribution to other
school districts under clause (i).
(d) On July 15, in years prior to 1988, an amount equal to
the increase derived by increasing the amount determined by
paragraph (c) in the same proportion as the increase in the
steel mill products index over the base year of 1977 as provided
in section 298.24, subdivision 1, clause (a), shall be
distributed to any school district described in paragraph (c)
where a levy increase pursuant to section 124A.03, subdivision
2, is authorized by referendum, according to the following
formula. On July 15, 1988, the increase over the amount
established for 1987 shall be determined as if there had been an
increase in the tax rate under section 298.24, subdivision 1,
paragraph (b), according to the increase in the implicit price
deflator. On July 15, 1989, and subsequent years, the increase
over the amount established for the prior year shall be
determined according to the increase in the implicit price
deflator as provided in section 298.24, subdivision 1, paragraph
(a). Each district shall receive the product of:
(i) $150 times the pupil units identified in section
124.17, subdivision 1, enrolled in the second previous year or
the 1983-1984 school year, whichever is greater, less the
product of 0.04231 1.8 percent times the district's taxable
market value net tax capacity in the second previous year; times
(ii) the lesser of:
(A) one, or
(B) the ratio of the amount certified pursuant to section
124A.03, subdivision 2, in the previous year, to the product of
0.04231 1.8 percent times the district's taxable market value
net tax capacity in the second previous year.
If the total amount provided by paragraph (d) is
insufficient to make the payments herein required then the
entitlement of $150 per pupil unit shall be reduced uniformly so
as not to exceed the funds available. Any amounts received by a
qualifying school district in any fiscal year pursuant to
paragraph (d) shall not be applied to reduce general education
aid which the district receives pursuant to section 124A.23 or
the permissible levies of the district. Any amount remaining
after the payments provided in this paragraph shall be paid to
the commissioner of iron range resources and rehabilitation who
shall deposit the same in the taconite environmental protection
fund and the northeast Minnesota economic protection trust fund
as provided in subdivision 11.
(e) There shall be distributed to any school district the
amount which the school district was entitled to receive under
section 298.32 in 1975.
Sec. 26. Minnesota Statutes 1989 Supplement, section
469.177, subdivision 1a, is amended to read:
Subd. 1a. [ORIGINAL TAX CAPACITY RATE.] At the time of the
initial certification of the original net tax capacity for a tax
increment financing district, the county auditor shall certify
the original tax capacity rate that applies to the district.
The original tax capacity rate is the sum of all the tax
capacity rates that apply to a property in the district for the
taxes payable in the calendar year in which the initial
certification of. The tax capacity rate to be certified is the
rate in effect for the same taxes payable year applicable to the
tax capacity values certified as the district's original net tax
capacity is requested under subdivision 1. If the total tax
capacity rate applicable to properties in the tax increment
financing district varies, the tax capacity rate must be
computed by determining the average total tax capacity rate in
the district, weighted on the basis of net tax capacity. The
resulting tax capacity rate is the original tax capacity rate
for the life of the district.
Sec. 27. Minnesota Statutes Second 1989 Supplement,
section 473F.08, subdivision 8a, is amended to read:
Subd. 8a. [FISCAL DISPARITIES ADJUSTMENT.] In any year in
which the highest class rate for class 3a property changes from
the rate in the previous year, the following adjustments shall
be made to the procedures described in sections 473F.06 to
473F.08.
(1) An initial contribution tax capacity shall be
determined for each municipality based on the previous year's
class rates.
(2) Each jurisdiction's distribution tax capacity shall be
determined based upon the areawide tax base determined by
summing the tax capacities computed under clause (1) for all
municipalities and apportioning the resulting sum pursuant to
section 473F.07, subdivision 5.
(3) Each jurisdiction's distribution levy shall be
determined by applying the procedures described in subdivision
3, clause (a), to the distribution tax capacity determined
pursuant to clause (2).
(4) Each municipality's final contribution tax capacity
shall be determined equal to its initial contribution tax
capacity multiplied by the ratio of the new highest class rate
for class 3a property to the previous year's highest class rate
for class 3a property.
(5) For the purposes of computing education aids and any
other state aids requiring the addition of the fiscal
disparities distribution tax capacity to the local tax capacity,
each municipality's final distribution tax capacity shall be
determined equal to its initial distribution tax capacity
multiplied by the ratio of the new highest class rate for class
3a property to the previous year's highest class rate for class
3a property.
(6) The areawide tax capacity rate shall be determined by
dividing the sum of the amounts determined in clause (3) by the
sum of the values determined in clause (4).
(6) (7) The final contribution tax capacity determined in
clause (4) shall also be used to determined the portion of each
commercial/industrial property's tax capacity subject to the
areawide tax capacity rate pursuant to subdivision 6.
Sec. 28. Minnesota Statutes 1989 Supplement, section
477A.011, subdivision 15, is amended to read:
Subd. 15. [CITY REVENUE.] "City revenue" equals the sum of
(i) the city's aid payable under section 477A.013, except for
aid payable under section 477A.013, subdivision 5, in the year
prior to that for which aids are being calculated, and (ii) its
levy for taxes payable in the year prior to that for which aids
are being calculated.
Sec. 29. Minnesota Statutes 1988, section 477A.011, is
amended by adding a subdivision to read:
Subd. 26. [LEVY.] "Levy" means the levy as defined in
section 275.07, subdivision 1, including the fiscal disparities
distribution levy.
Sec. 30. Minnesota Statutes Second 1989 Supplement,
section 477A.012, subdivision 3, is amended to read:
Subd. 3. [AID OFFSET FOR COURT COSTS.] (a) There shall be
deducted from the payment to a county under this section an
amount representing the cost to the state for assumption of the
cost of district court administration and operation of the trial
court information system in the county and, in the case of
Hennepin and Ramsey counties, of public defense services in
juvenile and misdemeanor cases in the county. The amount of the
deduction shall be computed as provided in this subdivision.
(b) By October 15, 1989, the board of public defense shall
determine and certify to the department of revenue the cost of
the state-financed public defense services in juvenile and
misdemeanor cases for Hennepin and Ramsey counties during the
fiscal year beginning the following July 1. By October 15,
1989, the supreme court shall determine and certify to the
department of revenue for each county, except counties located
in the eighth judicial district, the pro rata estimated share
for each county of district court administration and trial court
information system costs during the fiscal year beginning on the
following July 1.
(c) One-half of the amount computed under paragraph (b) for
each county shall be deducted from each payment to the county
under section 477A.015 in 1990 and each subsequent year.
(d) If the amount computed under paragraph (b) plus, if
applicable, the amount deducted under paragraph (e), exceeds the
amount payable to a county under subdivision 1, the excess shall
be deducted from the aid payable to the county under section
273.1398, subdivision 2.
(e) By July 15, 1990, the board of public defense and the
supreme court shall determine and certify to the department of
revenue the final actual budgeted amounts for the activities
described in paragraph (b). If the amount certified under
paragraph (b) is greater than the amount certified under this
paragraph, the excess shall be deducted from added to the aid
payable to the county in 1991 and each subsequent year under
this section. If the amount certified under paragraph (b) is
less than the amount certified under this paragraph, the
difference shall be added to subtracted from the aid payable to
the county in 1991 and each subsequent year under this section.
Sec. 31. Minnesota Statutes Second 1989 Supplement,
section 477A.013, subdivision 3, is amended to read:
Subd. 3. [CITY AID DISTRIBUTION.] In 1989, a city whose
initial aid is greater than $0 will receive the following aid
increases in addition to an amount equal to the local government
aid it received in 1988 under Minnesota Statutes 1987
Supplement, section 477A.013:
(1) for a city whose expenditure/unlimited aid ratio is at
least 1.5, two percent of city revenue;
(2) for a city whose expenditure/unlimited aid ratio is at
least 1.4 but less than 1.5, 2.5 percent of city revenue;
(3) for a city whose expenditure/unlimited aid ratio is at
least 1.3 but less than 1.4, three percent of city revenue;
(4) for a city whose expenditure/unlimited aid ratio is at
least 1.2 but less than 1.3, four percent of city revenue;
(5) for a city whose expenditure/unlimited aid ratio is at
least 1.1 but less than 1.2, five percent of city revenue;
(6) for a city whose expenditure/unlimited aid ratio is at
least 1.05 but less than 1.1, six percent of city revenue;
(7) for a city whose expenditure/unlimited aid ratio is at
least 1.0 but less than 1.05, seven percent of city revenue;
(8) for a city whose expenditure/unlimited aid ratio is at
least .95 but less than 1.0, 7.5 percent of city revenue;
(9) for a city whose expenditure/unlimited aid ratio is at
least .75 but less than .95, 8.5 percent of city revenue; and
(10) for a city whose expenditure/unlimited aid ratio is
less than .75, nine percent of city revenue.
In 1990, a city whose initial aid is greater than $0 will
receive an amount equal to the aid it received under this
section in the year prior to that for which aids are being
calculated plus an aid increase equal to 50 percent of the rates
listed in clauses (1) to (10) multiplied by city revenue.
In 1991 and subsequent years, a city whose initial aid is
greater than $0 will receive an amount equal to the aid it
received under this section in the year prior to that for which
aids are being calculated plus an aid increase equal to 25
percent of the rates listed in clauses (1) to (10) multiplied by
city revenue.
A city's aid increase under this subdivision is limited to
the lesser of (1) 20 percent of its levy for taxes payable in
the year prior to that for which aids are being calculated after
the adjustments provided in section 273.1398, subdivision 2, or
(2) its initial aid amount, or (3) 15 percent of the total
amount received under this section in the previous year,
provided that no city will receive an increase that is less than
two percent of its 1989 local government aid for aids payable in
1990.
A city whose initial aid is $0 will receive in 1990 an
amount equal to 102 percent of the local government aid it
received in 1989 under Minnesota Statutes 1988, section
477A.013. A city whose initial aid is $0 will receive in 1991
and subsequent years an amount equal to the aid it received in
the previous year under this section. For purposes of this
subdivision, the term "local government aid" includes
equalization aid for aids payable in 1991 and thereafter.
Sec. 32. Laws 1989, First Special Session chapter 1,
article 3, section 35, is amended to read:
Sec. 35. [EFFECTIVE DATE.]
Section 1 is effective the day following final enactment
and is intended to confirm and clarify the original intent of
the legislature in the taxation and equalization of
state-assessed public utility property.
Sections 2 and, 7, and 23 are effective for taxes payable
in 1991 and thereafter.
Sections 3, 5, 8, 11, 12, 23, 26, and 28 are effective for
taxes payable in 1990 and thereafter.
Section 4 is effective January 1, 1989.
Sections 6, 9, 21, 29 to 32, and 34 are effective the day
following final enactment.
Section 10 is effective for taxes levied in 1989, payable
in 1990 and thereafter, provided that cooperatives that
qualified under Minnesota Statutes, section 273.124, subdivision
6, on January 2, 1989, shall meet the board membership
requirements of paragraph (a) by December 1, 1989, and shall
meet the requirements of section 501(c)(3) or 501(c)(4) status
under the Internal Revenue Code in the first paragraph and in
paragraph (e) by January 1, 1990, and that the notice and filing
requirements of paragraphs (f) and (g) shall apply only to
leasehold cooperatives created later than 60 days after the date
of enactment of this act.
Sections 13, 19, and 20 are effective January 1, 1991.
Section 14, paragraph (i), clauses (1) to (12), are
effective for aids paid in 1991 and thereafter. The rest of
section 14 and sections 15, 17, 18, and 22 are effective for
aids paid in 1990 and thereafter, except as otherwise provided
in those sections.
Section 16 is effective for aids payable in 1991 and
thereafter.
Sections 24 and 25 are effective for mortgage registration
and deed taxes collected after November 30, 1990.
Section 27 is effective for taconite produced in 1989,
proceeds distributed in 1990, and thereafter.
Section 33 is effective July 1, 1991.
Sec. 33. Laws 1989, First Special Session chapter 1,
article 9, section 86, is amended to read:
Sec. 86. [EFFECTIVE DATES.]
Section 5 is effective for school district referenda held
after July 15, 1990, for property taxes levied in 1990, payable
in 1991, and thereafter.
Sections 1 to 4, 6 to 8, 10 to 12, 17, 19 to 21, 26 to 30,
41 to 46, 48, 50 to 52, 51, and 66 to 77 are effective for taxes
levied in 1990, payable in 1991, and thereafter.
The part of section 9 changing the meeting date of the
state board of equalization is effective for taxes levied in
1990, payable in 1991, and thereafter. The rest of section 9
and sections 13 to 16, 22 to 25, 78, and 82, 84, and 85 are
effective the day following final enactment.
Section 18 is effective for sales after January 1, 1990.
Sections 31 to 38 and 40 are effective for taxes levied in
1990, payable in 1991, and thereafter, except as otherwise
provided.
Sections 39, 47, 49, 52, 54 to 64, 79, and 80 are effective
for property taxes levied in 1989, payable in 1990, and
thereafter.
Section 53 is effective for property taxes levied in 1989,
payable in 1990, and thereafter, except that the provision
requiring certification of aids by September 1, is effective for
taxes levied in 1990, payable in 1991, and thereafter.
Sections 65 and 81 are effective July 1, 1990.
Section 83 is effective only for taxes levied in 1989,
payable in 1990.
Sec. 34. [REPEALER.]
Minnesota Statutes 1988, section 272.70, is repealed.
Sec. 35. [EFFECTIVE DATE.]
Sections 1, 4, 6, 14 to 16, and 32 to 34 are effective the
day following final enactment.
Sections 2, 5, 8 to 11, 13, 17, 18, 20, and 26 to 28 are
effective for taxes levied in 1989 and thereafter, payable in
1990 and thereafter, except as otherwise provided.
Section 12 is effective January 1, 1991.
Sections 7, 19, 21, and 22 are effective for taxes levied
in 1990 and thereafter, payable in 1991 and thereafter.
Sections 23 and 24 are effective for deed taxes collected
after November 30, 1990.
Section 25 is effective for production year 1989 and
thereafter, taxes payable in 1990 and thereafter.
Sections 29 to 31 are effective for aid paid in 1991 and
thereafter.
ARTICLE 8
PROPERTY TAX PAYMENTS, INTEREST RATES, AND SETTLEMENTS
Section 1. Minnesota Statutes Second 1989 Supplement,
section 276.09, is amended to read:
276.09 [SETTLEMENT BETWEEN AUDITOR AND TREASURER.]
On the later of May 20 of each year or 26 calendar days
after the postmark date on the envelopes containing real or
personal property tax statements, the county treasurer shall
make full settlement with the county auditor of all receipts
collected for all purposes, from the date of the last settlement
up to and including each day mentioned. The county auditor
shall, within 30 days after the settlement, send an abstract of
it to the state auditor in the form prescribed by the state
auditor. At the settlement the treasurer shall make complete
returns of the receipts on the current tax list, showing the
amount collected on account of the several funds included in the
list.
Settlement of receipts from the later of May 20 or the
actual settlement date to December 31 of each year must be made
as provided in section 276.111.
For purposes of this section, "receipts" includes all tax
payments received by the county treasurer on or before the
settlement date.
Sec. 2. Minnesota Statutes Second 1989 Supplement, section
276.10, is amended to read:
276.10 [APPORTIONMENT AND DISTRIBUTION OF FUNDS.]
On the settlement day in May of determined in section
276.09 for each year, the county auditor and county treasurer
shall distribute all undistributed funds in the treasury. The
funds must be apportioned as provided by law, and credited to
the state, town, city, school district, special district and
each county fund. Within 20 days after the distribution is
completed, the county auditor shall report to the state auditor
in the form prescribed by the state auditor. The county auditor
shall issue a warrant for the payment of money in the county
treasury to the credit of the state, town, city, school
district, or special districts on application of the persons
entitled to receive the payment. The county auditor may apply
the tax capacity rate from the year before the year of
distribution when apportioning and distributing delinquent tax
proceeds, if the composition of the previous year's tax capacity
rate between taxing districts is not significantly
different than from the tax capacity rate that existed for the
year of the delinquency.
Sec. 3. Minnesota Statutes Second 1989 Supplement, section
276.11, subdivision 1, is amended to read:
Subdivision 1. [GENERALLY.] As soon as practical after the
May settlement day determined in section 276.09, the county
treasurer shall pay to the state treasurer or the treasurer of a
town, city, school district, or special district, on the warrant
of the county auditor, all receipts of taxes levied by the
taxing district and deliver up all orders and other evidences of
indebtedness of the taxing district, taking triplicate receipts
for them. The treasurer shall file one of the receipts with the
county auditor, and shall return one by mail on the day of its
receipt to the clerk of the town, city, school district, or
special district to which payment was made. The clerk shall
keep the receipt in the clerk's office. Upon written request of
the taxing district, to the extent practicable, the county
treasurer shall make partial payments of amounts collected
periodically in advance of the next settlement and
distribution. A statement prepared by the county treasurer must
accompany each payment. It must state the years for which taxes
included in the payment were collected and, for each year, the
amount of the taxes and any penalties on the tax. Upon written
request of a taxing district, except school districts, the
county treasurer shall pay at least 70 percent of the estimated
collection within 30 days after the May settlement
date determined in section 276.09. Within seven business days
after the due date, or 28 calendar days after the postmark date
on the envelopes containing real or personal property tax
statements, whichever is latest, the county treasurer shall pay
to the treasurer of the school districts 50 percent of the
estimated collections arising from taxes levied by and belonging
to the school district, unless the school district elects to
receive 50 percent of the estimated collections arising from
taxes levied by and belonging to the school district after
making a proportionate reduction to reflect any loss in
collections as the result of any delay in mailing tax
statements. In that case, 50 percent of those adjusted,
estimated collections shall be paid by the county treasurer to
the treasurer of the school district within seven business days
of the due date. The remaining 50 percent of the estimated
collections must be paid to the treasurer of the school district
within the next seven business days of the later of the dates in
the preceding sentence, unless the school district elects to
receive the remainder of its estimated collections after a
proportionate reduction has been made to reflect any loss in
collections as the result of any delay in mailing tax statements.
In that case, the remaining 50 percent of those adjusted,
estimated collections shall be paid by the county treasurer to
the treasurer of the school district within 14 days of the due
date. The treasurer shall pay the balance of the amounts
collected to the state or to a municipal corporation or other
body within 60 days after the May settlement date determined in
section 276.09. After 45 days interest at an annual rate of
eight percent accrues and must be paid to the taxing district.
Interest must be paid upon appropriation from the general
revenue fund of the county. If not paid, it may be recovered by
the taxing district, in a civil action.
Sec. 4. Minnesota Statutes 1988, section 276.111, is
amended to read:
276.111 [DISTRIBUTIONS AND FINAL YEAR-END SETTLEMENT.]
Within seven business days after October 15, the county
treasurer shall pay to the school districts 50 percent of the
estimated collections arising from taxes levied by and belonging
to the school district from May 20 the settlement day determined
in section 276.09 to October 20. The remaining 50 percent of
the estimated tax collections must be paid to the school
district within the next seven business days. Within ten
business days after November 15, the county treasurer shall pay
to the school district 100 percent of the estimated collections
arising from taxes levied by and belonging to the school
districts from October 20 to November 20.
Within ten business days after November 15, the county
treasurer shall pay to each taxing district, except any school
district, 100 percent of the estimated collections arising from
taxes levied by and belonging to each taxing district from May
20 the settlement day determined in section 276.09 to November
20.
On or before January 5, the county treasurer shall make
full settlement with the county auditor of all receipts
collected from May 20 the settlement day determined in section
276.09 to December 31. After subtracting any tax distributions
that have been made to the taxing districts in October and
November, the treasurer shall pay to each of the taxing
districts on or before January 25, the balance of the tax
amounts collected on behalf of each taxing district. Interest
accrues at an annual rate of eight percent and must be paid to
the taxing district if this final settlement amount is not paid
by January 25. Interest must be paid upon appropriation from
the general revenue fund of the county. If not paid, it may be
recovered by the taxing district in a civil action.
Sec. 5. Minnesota Statutes Second 1989 Supplement, section
277.01, subdivision 1, is amended to read:
Subdivision 1. Except as provided in this subdivision, all
unpaid personal property taxes shall be deemed delinquent on May
16 next after they become due or 21 days after the postmark date
on the envelope containing the property tax statement, whichever
is later, and thereupon a penalty of eight percent shall attach
and be charged upon all such taxes. In the case of unpaid
personal property taxes due and owing under section 272.01,
subdivision 2, or section 273.19, the first half shall become
delinquent if not paid before May 16 or 21 days after the
postmark date on the envelope containing the property tax
statement, whichever is later, and thereupon a penalty of eight
percent shall attach on the unpaid first half; and the second
half shall become delinquent if not paid before October 16, and
thereupon a penalty of eight percent shall attach on the unpaid
second half. This section shall not apply to Class 2a property.
A county may provide by resolution that in the case of a
property owner that has multiple personal property tax
statements with the aggregate taxes exceeding $50, payments may
be made in installments as provided in this subdivision.
The county treasurer may accept payments of more or less
than the exact amount of a tax installment due. If the accepted
payment is less than the amount due, payments must be applied
first to the penalty accrued for the year the payment is made.
Acceptance of partial payment of tax does not constitute a
waiver of the minimum payment required as a condition for filing
an appeal under section 277.011 or any other law, nor does it
affect the order of payment of delinquent taxes under section
280.39.
Sec. 6. Minnesota Statutes Second 1989 Supplement, section
277.02, is amended to read:
277.02 [DELINQUENT LIST FILED IN COURT.]
By June 15 Within 30 days of the due date under section
277.01, subdivision 1, of each year, the county treasurer shall
make a list of all personal property taxes remaining delinquent
May 16, and by November 15 of each year the county treasurer
shall make a list of all personal property taxable under section
272.01, subdivision 2, or section 273.19 remaining delinquent
October 16. The county treasurer shall immediately certify to
and file the same each list with the court administrator of the
district court of the county, and. Upon such filing, the list
shall be prima facie evidence that all of the provisions of law
in relation to the assessment and levy of such taxes have been
complied with.
Sec. 7. Minnesota Statutes Second 1989 Supplement, section
277.05, is amended to read:
277.05 [SHERIFF TO FILE LIST OF UNCOLLECTED TAXES.]
If the sheriff is unable, for want of goods and chattels
whereon to levy, to collect by a distress, or otherwise, the
taxes, or any part thereof, assessed upon the personal property
of any persons, the sheriff shall file with the court
administrator of the district court, on July 15 following, a
list of such the taxes, 30 days after the date in section
277.02. The list shall be filed with an affidavit of the
sheriff, or of the deputy sheriff entrusted with the collection
thereof, stating that the affiant has made diligent search and
inquiry for goods and chattels from which to collect such taxes,
and is unable to collect the same. The list of such taxes as
they apply to manufactured homes shall be filed on December
1 and the list of such taxes as they apply to property taxable
under section 272.01, subdivision 2, or section 273.19 shall be
filed on December 15. The sheriff shall note on the margin of
such list the place to which any delinquent taxpayer may have
removed, with the date of removal, if known. At the time of
filing the list the sheriff shall also return all the warrants
with endorsements thereon showing the doings of the sheriff or
deputy in the premises, and the court administrator shall file
and preserve the same. On or before September tenth
thereafter Within ten days after the list has been filed by the
sheriff, the court administrator shall deliver such the list and
affidavit to the county treasurer, who shall, by comparison of
such list with the tax duplicates in the treasurer's office,
ascertain whether or not all personal property taxes reported by
the treasurer to the court administrator as delinquent, except
those included in such list, have been paid into the treasurer's
office, and shall attach to the list a certificate stating
whether or not all taxes reported by the treasurer to the court
administrator as delinquent and not included in the list have
been received, and stating the items of such taxes, if any, as
have been received. The court administrator shall deliver such
list and affidavit as they apply to manufactured homes on or
before December 10 and as they apply to property taxable under
section 272.01, subdivision 2, or section 273.19 on or before
December 24. The treasurer shall deliver such list and
affidavit, with the certificate attached, to the county board at
its first session thereafter, which shall cancel such taxes as
it is satisfied cannot be collected. A copy of the tax list so
revised, and also a separate list of the taxes so canceled,
shall be included in the records of the proceedings of the
board, and published in full, as a part of the proceedings.
Sec. 8. Minnesota Statutes Second 1989 Supplement, section
277.06, is amended to read:
277.06 [CITATION TO DELINQUENTS; DEFAULT JUDGMENT.]
On September 5, or within ten days after the adjournment of
the county board, whichever occurs first, the county auditor
shall file a copy of such revised list with the court
administrator of the district court. The county auditor shall
file a copy of the revised list as it applies to manufactured
homes on January 20 and a copy of the revised list as it applies
to property taxable under section 272.01, subdivision 2, or
section 273.19 on February 15. Within ten days after the list
has been filed, the court administrator shall issue a citation
to each delinquent named in the list, stating the amount of tax
and penalty, and requiring such delinquent to appear on a day to
be set by the district court in the county, appointed to be held
at a time not less than 30 days after the issuance of such
citation, and show cause, if any there be, why the delinquent
should not pay the tax and penalty. The citation shall be
delivered for service to the sheriff of the county where such
person may at the time reside or be. If such person, after
service of the citation, fails to pay such tax, penalty, and
costs to the sheriff before the first day of the term, or on
such day to show cause as aforesaid, the court shall direct
judgment against the person for the amount of such tax, penalty,
and costs. When unable to serve the citation, the sheriff shall
return the same to the court administrator, with a return
thereto to that effect, and thereupon, or if the court decides
that the service of such citation made or attempted to be made,
or the issuance thereof by the court administrator, was illegal,
the court administrator shall issue another like citation,
requiring such delinquent to appear on the first day of the next
general term to be held in the county, and show cause as
aforesaid, and if the delinquent fails to pay or to show cause,
the court shall direct judgment as aforesaid. Whenever the
sheriff has been unable to serve any such citation theretofore
issued in any year or years, or whenever the court decides that
the service of any such citation theretofore made or attempted
to be made, or the issuance thereof by the court administrator,
was illegal, the court administrator shall issue another like
citation requiring such delinquent to appear, as in the case
last provided, and with like effect; provided, that all
citations other than the first shall be issued only on the
request of the county attorney.
Sec. 9. Minnesota Statutes 1988, section 277.15, is
amended to read:
277.15 [INTEREST.]
When a judgment has heretofore been entered and docketed,
or shall hereafter be entered and docketed, for the recovery of
taxes, except in the case of real estate tax judgments provided
for in section 279.19, the same shall bear interest until paid
at the rate of six percent per annum until January 1, 1981, and
at the rate determined under section 549.09 thereafter until
January 1, 1991. Thereafter interest will be payable at the
rate provided in section 279.03, subdivision 1a.
Sec. 10. Minnesota Statutes 1989 Supplement, section
279.01, subdivision 1, is amended to read:
Subdivision 1. Except as provided in subdivision 3, on May
16, of each year, with respect to property actually occupied and
used as a homestead by the owner of the property, or 21 days
after the postmark date on the envelope containing the property
tax statement, whichever is later, a penalty of three percent
shall accrue and thereafter be charged upon all unpaid taxes on
real estate on the current lists in the hands of the county
treasurer, and a penalty of. The penalty shall be at a rate of
three percent on homestead property and seven percent on
nonhomestead property, except that. This penalty shall not
accrue until June 1 of each year, or 21 days after the postmark
date on the envelope containing the property tax statements,
whichever is later, on commercial use real property used for
seasonal residential recreational purposes and classified as
class 1c or 4c, and on other commercial use real property
classified as class 3a, provided that over 60 percent of the
gross income earned by the enterprise on the class 3a property
is earned during the months of May, June, July, and August. Any
property owner of such class 3a property who pays the first half
of the tax due on the property after May 15 and before June 1,
or 21 days after the postmark date on the envelope containing
the property tax statement, whichever is later, shall attach an
affidavit to the payment attesting to compliance with the income
provision of this subdivision. Thereafter, for both homestead
and nonhomestead property, on the first day of each month, up to
and including October 1 following, an additional penalty of one
percent for each month shall accrue and be charged on all such
unpaid taxes provided that if the due date was extended beyond
May 15 as the result of any delay in mailing property tax
statements no additional penalty shall accrue if the tax is paid
by the extended due date. If the tax is not paid by the
extended due date, then all penalties that would have accrued if
the due date had been May 15 shall be charged. When the taxes
against any tract or lot exceed $50, one-half thereof may be
paid prior to May 16 or 21 days after the postmark date on the
envelope containing the property tax statement, whichever is
later; and, if so paid, no penalty shall attach; the remaining
one-half shall be paid at any time prior to October 16
following, without penalty; but, if not so paid, then a penalty
of four percent shall accrue thereon for homestead property and
a penalty of four percent on nonhomestead property. Thereafter,
for homestead property, on the first day of November and
December following, an additional penalty of two percent for
each month shall accrue and be charged on all such unpaid taxes.
Thereafter, for nonhomestead property, on the first day of
November and December following, an additional penalty of four
percent for each month shall accrue and be charged on all such
unpaid taxes. If one-half of such taxes shall not be paid prior
to May 16 or 21 days after the postmark date on the envelope
containing the property tax statement, whichever is later, the
same may be paid at any time prior to October 16, with accrued
penalties to the date of payment added, and thereupon no penalty
shall attach to the remaining one-half until October 16
following.
A county may provide by resolution that in the case of a
property owner that has multiple tracts or parcels with
aggregate taxes exceeding $50, payments may be made in
installments as provided in this subdivision.
The county treasurer may accept payments of more or less
than the exact amount of a tax installment due. If the accepted
payment is less than the amount due, payments must be applied
first to the penalty accrued for the year the payment is made.
Acceptance of partial payment of tax does not constitute a
waiver of the minimum payment required as a condition for filing
an appeal under section 278.03 or any other law, nor does it
affect the order of payment of delinquent taxes under section
280.39.
Sec. 11. Minnesota Statutes 1988, section 279.03, is
amended by adding a subdivision to read:
Subd. 1a. [RATE AFTER DECEMBER 31, 1990.] Interest on
delinquent property taxes, penalties, and costs unpaid on or
after January 1, 1991, shall be payable at the per annum rate
determined in section 270.75, subdivision 5. If the rate so
determined is less than ten percent, the rate of interest shall
be ten percent. The maximum per annum rate shall be 14 percent
if the rate specified under section 270.75, subdivision 5,
exceeds 14 percent. The rate shall be subject to change on
January 1 of each year.
Sec. 12. Minnesota Statutes 1988, section 279.03,
subdivision 2, is amended to read:
Subd. 2. [COMPOSITE JUDGMENT.] Amounts included in
composite judgment, as judgments authorized by section 279.37,
subdivision 1, and confessed on or after July 1, 1982, are
subject to interest at the rate determined pursuant to section
549.09. Amounts confessed under this authority after December
31, 1990, are subject to interest at the rate calculated under
subdivision 1a. During each calendar year, interest shall
accrue on the unpaid balance of the composite judgment from the
time it is confessed until it is paid. The rate of interest is
subject to change each year in the same manner that section
549.09 provides or subdivision 1a, whichever is applicable, for
rate changes on judgments. Interest on the unpaid contract
balance on judgments confessed before July 1, 1982, is payable
at the rate applicable to the judgment at the time that it was
confessed.
Sec. 13. Minnesota Statutes 1988, section 279.37,
subdivision 1a, is amended to read:
Subd. 1a. The delinquent taxes upon a parcel of property
which was classified class 4c pursuant to section 273.13,
subdivision 9, or for taxes assessed in 1986 and thereafter,
classified class 3a, for the previous year's assessment and had
a total market value of less than $100,000 for that same
assessment shall be eligible to be composed into a confession of
judgment. Property qualifying under this subdivision shall be
subject to the same provisions as provided in this section
except as herein provided.
(a) The down payment shall include all special assessments
due in the current tax year, all delinquent special assessments,
and 20 percent of the ad valorem tax, penalties, and interest
accrued against the parcel. The balance remaining shall be
payable in four equal annual installments; and
(b) The amounts entered in judgment shall bear interest at
the rate provided in section 270.75, subdivision 5 279.03,
subdivision 1a, commencing with the date the judgment is
entered. The interest rate is subject to change each year on
the unpaid balance in the manner provided in section 270.75,
subdivision 5, except that the interest change will be
implemented on January 1 of each year 279.03, subdivision 1a.
Sec. 14. Minnesota Statutes 1988, section 282.01,
subdivision 4, is amended to read:
Subd. 4. [CONDUCT OF SALE.] The sale shall be conducted by
the county auditor at the county seat of the county in which the
parcels lie, provided that, in St. Louis and Koochiching
counties, the sale may be conducted in any county facility
within the county, and the parcels shall be sold for cash only
and at not less than the appraised value, unless the county
board of the county shall have adopted a resolution providing
for their sale on terms, in which event the resolution shall
control with respect thereto. When the sale is made on terms
other than for cash only a payment of at least ten percent of
the purchase price must be made at the time of purchase,
thereupon the balance shall be paid in no more than ten equal
annual installments. No standing timber or timber products
shall be removed from these lands until an amount equal to the
appraised value of all standing timber or timber products on the
lands at the time of purchase has been paid by the purchaser;
provided, that in case any parcel of land bearing standing
timber or timber products is sold at public auction for more
than the appraised value, the amount bid in excess of the
appraised value shall be allocated between the land and the
timber in proportion to the respective appraised values thereof,
and no standing timber or timber products shall be removed from
the land until the amount of the excess bid allocated to timber
or timber products has been paid in addition to the appraised
value thereof. The purchaser is entitled to immediate
possession, subject to the provisions of any existing valid
lease made in behalf of the state.
For sales occurring on or after July 1, 1982, the unpaid
balance of the purchase price is subject to interest at the rate
determined pursuant to section 549.09. The unpaid balance of
the purchase price for sales occurring after December 31, 1990,
is subject to interest at the rate determined in section 279.03,
subdivision 1a. The interest rate is subject to change each
year on the unpaid balance in the manner provided for rate
changes in section 549.09 for rate changes on judgments or
section 279.03, subdivision 1a, whichever, is applicable.
Interest on the unpaid contract balance on sales occurring
before July 1, 1982, is payable at the rate applicable to the
sale at the time that the sale occurred.
Sec. 15. Minnesota Statutes 1988, section 282.09,
subdivision 1, is amended to read:
Subdivision 1. [MONEYS PLACED IN FUND.] The county auditor
and county treasurer shall place all moneys received through the
operation of sections 282.01 to 282.13 in a fund to be known as
the forfeited tax sale fund and all disbursements and costs
shall be charged against that fund, when allowed by the county
board. Members of the county board may be paid a per diem
pursuant to section 375.055, subdivision 1, and reimbursed for
their necessary expenses, and may receive mileage as now or
hereafter fixed by law. Compensation of a land commissioner and
assistants, if a land commissioner is appointed, shall be in
such the amount as shall be determined by the county board. The
county auditor shall receive 50 cents for each certificate of
sale, each contract for deed and each lease executed by the
auditor, and, in counties where no land commissioner is
appointed such, additional annual compensation, not exceeding
$300, as shall be fixed by the county board. Compensation of
any other clerical help that may be needed by the county auditor
or land commissioner shall be in such the amount as shall be
determined by the county board. All compensation provided for
herein shall be in addition to other compensation allowed by
law. Fees so charged in addition to the fee imposed in section
282.014 shall be included in the annual settlement by the county
auditor as hereinafter provided. On or before February 1 in
each year, the commissioner of revenue shall certify to the
commissioner of finance, by counties, the total number of state
deeds issued and reissued during the preceding calendar year for
which such fees are charged and the total amount thereof. When
disbursements are made from the fund for repairs, refundments,
expenses of actions to quiet title, or any other purpose which
particularly affects specific parcels of forfeited lands, the
amount of such disbursements shall be charged to the account of
the taxing districts interested in such parcels. The county
auditor shall make an annual settlement of the net proceeds
received from sales and rentals by the operation of sections
282.01 to 282.13, at on the regular March settlement day
determined in section 276.09, for the preceding calendar year.
Sec. 16. Minnesota Statutes 1988, section 282.261,
subdivision 2, is amended to read:
Subd. 2. [INTEREST RATE.] The unpaid balance on any
repurchase contract approved by the county board on or after
July 1, 1982, is subject to interest at the rate determined
pursuant to section 549.09. Repurchase contracts approved after
December 31, 1990, are subject to interest at the rate
determined in section 279.03, subdivision 1a. The interest rate
is subject to change each year on the unpaid balance in the
manner provided for rate changes in section 549.09 for rate
changes on judgments or section 279.03, subdivision 1a,
whichever is applicable. Interest on the unpaid contract
balance on repurchases approved before July 1, 1982, is payable
at the rate applicable to the repurchase contract at the time
that it was approved.
Sec. 17. [1990 TAX PAYMENTS.]
The amendment of Minnesota Statutes Second 1989 Supplement,
section 277.01, subdivision 1, in section 5 does not require
sending of revised tax statements for taxes payable in 1990 by
the county auditor, but payments of taxes by the dates provided
in that section shall be accepted as timely paid.
Sec. 18. [EFFECTIVE DATE.]
Sections 1 to 8, 10, and 14 are effective for taxes levied
in 1989, payable in 1990, and thereafter.
Sections 9, 11 to 13, 15, and 16 are effective January 1,
1991.
Section 17 is effective the day following final enactment.
ARTICLE 9
PROPERTY TAX SYSTEM CONVERSIONS
Section 1. Minnesota Statutes 1989 Supplement, section
38.18, is amended to read:
38.18 [COUNTY FAIRGROUNDS, IMPROVEMENT AIDED.]
Any town, statutory city, or school district in this state,
now or hereafter having a net tax capacity market value of all
its taxable property, exclusive of money and credits, of more
than $25,000,000 $105,000,000, and having a county fair located
within its corporate limits, is hereby authorized to aid in
defraying part of the expense of improving any such fairground,
by appropriating and paying over to the treasurer of the county
owning the fairground such sum of money, not exceeding $10,000,
for each of the political subdivisions, as the governing body of
the town, statutory city, or school district may, by resolution,
determine to be for the best interest of the political
subdivision, the sums so appropriated to be used solely for the
purpose of aiding in the improvement of the fairground in such
manner as the county board of the county shall determine to be
for the best interest of the county.
Sec. 2. Minnesota Statutes 1989 Supplement, section 50.14,
subdivision 4, is amended to read:
Subd. 4. Class three shall be:
(a) The bonds, certificates of indebtedness, or other
interest bearing obligations, payable out of a levy of ad
valorem taxes, of any county, city, town, or any school
district, drainage district, or other district, or of any board
of any municipality, or of any public authority, created
pursuant to law for public purposes in Minnesota, without regard
to any debt limits other than those in section 475.53;
(b) The bonds, certificates of indebtedness or other
interest bearing obligations, payable out of a levy of ad
valorem taxes, of any county, city, town, or school, drainage or
other district, or public authority, created pursuant to law for
public purposes in any state of the United States other than
Minnesota, provided that the total bonded indebtedness of the
county, municipality, district or authority, after deducting the
amount of all sinking funds and of all revenue bonds or
certificates (including among revenue bonds and certificates
those which pledge the full faith and credit of the issuer, if
the net revenues applicable to the payment of the bonds or
certificates during the three fiscal years immediately preceding
the date of purchase exceeded by at least five percent the
amount required to pay principal and interest on those bonds or
certificates during that period), shall not exceed ten percent
of its net tax capacity assessed value; and provided further
that if the county, municipality, district or authority is of
any state other than Iowa, Wisconsin, North Dakota, or South
Dakota, it contains at least 3,500 inhabitants;
(c) The bonds, certificates or other interest bearing
obligations, payable out of special revenues, of any county,
city, town, or school, drainage, or other district, or public
authority, created pursuant to law for public purposes in any
state of the United States, provided that:
(aa) If the county, municipality, district or authority is
of any state other than Minnesota, it contains at least 3,500
inhabitants;
(bb) The obligations were issued to finance the purpose of
construction of or addition to a public enterprise furnishing
water, sewer, lighting, power, gas, or road facilities, from
which revenue is to be derived;
(cc) The governing body or other legally constituted
authority has covenanted or is required by law to establish and
maintain rates to yield sufficient revenue for the payment of
operating expenses, maintenance expenses, and principal and
interest on the revenue obligations and to pledge that revenue
irrevocably for those purposes;
(dd) At the date of investment the public enterprise has
been in operation for at least three years; and
(ee) During the preceding three fiscal years its annual
net earnings, after payment of operating expenses and
maintenance expenses, have been on the average at least 1-1/4
times the average annual interest, principal and sinking fund
requirements on the revenue obligations during the period from
the end of its most recent fiscal year to the final maturity of
the obligations; and
(d) The bonds or other interest bearing obligations,
payable from revenues other than ad valorem taxes as
contemplated in clause (a), validly issued by any state or
insular possession of the United States, or by any agency,
instrumentality, municipality, or governmental or public
subdivision, district, corporation, commission, board, council,
or authority of whatsoever kind, created for public purposes by
or pursuant to the laws of any state, provided that the bonds or
other interest bearing obligations are at the time of purchase
rated among the highest three quality categories, not applicable
to bonds or other interest bearing obligations in default as to
principal, used by a nationally recognized rating agency for
rating the quality of similar bonds or other interest bearing
obligations, and are not rated lower by any other such agency.
Sec. 3. Minnesota Statutes 1989 Supplement, section
110.70, is amended to read:
110.70 [APPLICATION.]
Nothing in sections 110.55 to 110.69 shall amend, alter,
supersede, or otherwise change the provisions set forth in
section 110.13. The provisions of sections 110.55 to 110.69
shall in no manner apply to public waters of an area of more
than 10,000 acres, situated wholly or partially within counties
now or hereafter having a population of more than 450,000 and a
net tax capacity market value of more
than $450,000,000 $1,860,000,000, including money and credits,
and in which is situated a city of the first class within a
distance of 20 miles from the body of public water; and, as to
such public waters, nothing contained in sections 110.55 to
110.69 shall be construed to authorize the diversion of any
water from any stream, river, or lake located in any county
adjoining or abutting in part upon the county wherein a major
portion of such public waters is located.
Sec. 4. Minnesota Statutes 1989 Supplement, section
118.12, is amended to read:
118.12 [INVESTMENT OF TOWN FUNDS.]
When the town board of any town in this state, by a
unanimous resolution, deem it advisable, such town board may
invest such amount of funds in such town treasury as will not,
in the opinion of such board, be needed by such town during the
fiscal year, in any of the bonds of any county, city, town,
school district, drainage or other district created pursuant to
law for public purposes in Minnesota, Iowa, Wisconsin, and North
and South Dakota, or in bonds of the United States of America,
or in the bonds of any city, county, town, school district,
drainage or other district created pursuant to law for public
purposes in the United States, containing at least 3,500
inhabitants, provided that the total bonded indebtedness of any
such municipality or district shall not exceed ten percent of
its net tax capacity assessed value, if not located in
Minnesota, or 2.5 percent of its taxable market value, if
located in Minnesota.
Sec. 5. Minnesota Statutes 1989 Supplement, section
163.04, subdivision 3, is amended to read:
Subd. 3. [EXPENDITURES ON BRIDGES WITHIN CERTAIN CITIES.]
When the council of any statutory city or city of the third or
fourth class may determine that it is necessary to build or
improve any bridge or bridges, including approaches thereto, and
any dam or retaining works connected therewith, upon or forming
a part of streets or highways either wholly or partly within its
limits, the county board shall appropriate one-half of the money
as may be necessary therefor from the county road and bridge
fund, not exceeding during any year one-half the amount of taxes
paid into the county road and bridge fund during the preceding
year, on property within the corporate limits of the city. The
appropriation shall be made upon the petition of the council,
which petition shall be filed by the council with the county
board prior to the fixing by the board of the annual county tax
levy. The county board shall determine the plans and
specifications, shall let all necessary contracts, shall have
charge of construction, and upon its request, warrants in
payment thereof shall be issued by the county auditor, from time
to time, as the construction work proceeds. Any unpaid balance
may be paid or advanced by the city. On petition of the
council, the appropriations of the county board, during not to
exceed three successive years, may be made to apply on the
construction of the same items and to repay any money advanced
by the city in the construction thereof. None of the provisions
of this section shall be construed to be mandatory as applied to
any city whose net tax capacity market value exceeds $500 $2,100
per capita of its population.
Sec. 6. Minnesota Statutes 1989 Supplement, section
163.06, subdivision 6, is amended to read:
Subd. 6. [EXPENDITURE IN CERTAIN COUNTIES.] In any county
having not less than 95 nor more than 105 full and fractional
townships, and having a net tax capacity market value of not
less than $3,000,000 $12,000,000 nor more than
$5,000,000 $21,000,000, exclusive of money and credits, the
county board, by resolution, may expend the funds provided in
subdivision 4 in any organized or unorganized township or
portion thereof in such county.
Sec. 7. Minnesota Statutes 1989 Supplement, section
165.10, subdivision 1, is amended to read:
Subdivision 1. [CERTAIN COUNTIES MAY ISSUE AND SELL.] The
county board of any county having no outstanding road and bridge
bonds may issue and sell county road bonds in an amount not
exceeding one-half of one 0.12089 percent of the net tax
capacity market value of the taxable property within the county
exclusive of money and credits, for the purpose of constructing,
reconstructing, improving, or maintaining any bridge or bridges
on any highway under its jurisdiction, without submitting the
matter to a vote of the electors of the county.
Sec. 8. Minnesota Statutes 1989 Supplement, section
365.025, subdivision 4, is amended to read:
Subd. 4. [BIG BUYS MAJOR PURCHASES: NOTICE, PETITION,
ELECTION.] Before buying anything under subdivision 2 that costs
more than one 0.24177 percent of the net tax capacity market
value of the town, the town must follow this subdivision.
The town must publish in its official newspaper the board's
resolution to pay for the property over time. Then a petition
for an election on the contract may be filed with the clerk.
The petition must be filed within ten days after the resolution
is published. To require the election the petition must be
signed by a number of voters equal to ten percent of the voters
at the last regular town election. The contract then must be
approved by a majority of those voting on the question. The
question may be voted on at a regular or special election.
Sec. 9. Minnesota Statutes 1989 Supplement, section
368.01, subdivision 23, is amended to read:
Subd. 23. [FINANCING PURCHASE OF CERTAIN EQUIPMENT.] The
town board of supervisors may issue certificates of indebtedness
within existing debt limits for the purpose of purchasing fire
or police equipment or ambulance equipment or street
construction or maintenance equipment. Such certificates shall
be payable in not more than five years and shall be issued on
such terms and in such manner as the board may determine. If
the amount of the certificates to be issued to finance any such
purchase exceeds one 0.24177 percent of the net tax
capacity market value of the town, excluding money and credits,
they shall not be issued for at least ten days after publication
in the official newspaper of a town board resolution determining
to issue them; and if before the end of that time, a petition
asking for an election on the proposition signed by voters equal
to ten percent of the number of voters at the last regular town
election is filed with the clerk, such certificates shall not be
issued until the proposition of their issuance has been approved
by a majority of the votes cast on the question at a regular or
special election. A tax levy shall be made for the payment of
the principal and interest on such certificates as in the case
of bonds.
Sec. 10. Minnesota Statutes 1989 Supplement, section
368.44, is amended to read:
368.44 [DISSOLUTION OF CERTAIN TOWNS; GROUNDS.]
When the voters residing within a duly organized town in
any county in this state having more than 85 congressional
townships of land and having a net tax capacity market value of
not less than $5,000,000 $21,000,000 nor more than
$12,000,000 $50,000,000 have failed to elect any town officials
for more than three years continuously, or the town has failed
and omitted to exercise any of the powers and functions of a
town, as provided by law, which facts, or any of them, may be
found and determined by the resolution of the county board of
the county in which the town is located, according to the
official records in the office of the auditor of the county, the
county board by resolution duly adopted may declare any such
town, naming it, duly dissolved and no longer entitled to
exercise any of the powers or functions of a town.
Sec. 11. Minnesota Statutes 1989 Supplement, section
368.47, is amended to read:
368.47 [TOWNS MAY BE DISSOLVED.]
When the voters residing within a town in this state have
failed to elect any town officials for more than ten years
continuously, or the town has failed and omitted for a period of
ten years to exercise any of the powers and functions of a town,
as provided by law, or when the net tax capacity market value of
any town drops to less than $40,000 $165,000, or when the tax
delinquency of any such town, exclusive of taxes that are
delinquent or unpaid by reason of taxes being contested in
proceedings for the enforcement of taxes, amounts to 50 12
percent of its net tax capacity market value, or where the state
or federal government has acquired title to 50 percent of the
real estate of such town, which facts, or any of them, may be
found and determined by the resolution of the county board of
the county in which the town is located, according to the
official records in the office of the county auditor, the county
board by resolution may declare any such town, naming it, duly
dissolved and no longer entitled to exercise any of the powers
or functions of a town. In counties having a population
according to the 1930 federal census of not more than 16,000 nor
less than 15,000 and having not more than 77 nor less than 75
full or fractional congressional townships, and in counties
having a population according to the 1930 federal census of not
more than 28,000 nor less than 27,000 and having not more than
91 nor less than 90 full or fractional congressional townships,
and in counties having a population according to the 1930
federal census of not more than 210,000 nor less than 200,000
and having not more than 202 nor less than 200 full or
fractional congressional townships, before any such dissolution
shall become effective the voters of the town shall express
their approval or disapproval of such dissolution. The clerk of
the town shall, upon a petition signed by a majority of the
registered voters of the town, filed with the clerk at least 60
days before any regular or special town election thereof, give
notice at the same time and in the same manner of such election
that the question of dissolution of such town will be submitted
for determination at such election. At such election when so
petitioned for the question shall be voted upon by a separate
ballot, the terms of which shall be either "for dissolution" or
"against dissolution," which ballot shall be deposited in a
separate ballot box to be provided and the result of such voting
shall be duly canvassed, certified, and returned in the same
manner and at the same time as other facts and returns of the
election. If a majority of the votes cast at the election shall
be for dissolution, such town shall be dissolved; and, if a
majority of the votes cast at the election shall be against
dissolution, the town shall not be dissolved.
When a town is dissolved under the provisions of sections
368.47 to 368.49 the county shall acquire title to any telephone
company or any other business being conducted by such town and
such business shall be operated by the board of county
commissioners until such time as a sale thereof can be made;
provided that the subscribers or patrons of such businesses
shall have the first opportunity of purchase. If such dissolved
town has any outstanding indebtedness chargeable to such
business, the auditor of the county wherein such dissolved town
is located shall levy a tax against the property situated in the
dissolved town for the purpose of paying the indebtedness as it
becomes due.
Sec. 12. Minnesota Statutes 1989 Supplement, section
370.01, is amended to read:
370.01 [CHANGE OF BOUNDARIES; CREATION OF NEW COUNTIES.]
The boundaries of counties may be changed by taking
territory from a county and attaching it to an adjoining county,
and new counties may be established out of territory of one or
more existing counties. A new county shall contain at least 400
square miles, have at least 2,000 inhabitants, and have a net
tax capacity market value of at least $4,000,000 $17,000,000.
An existing county shall not be reduced in area below 400 square
miles, have less than 2,000 inhabitants, or have a net tax
capacity market value of less than $4,000,000 $17,000,000.
In existing counties having an area of more than 3,500 and
less than 6,000 square miles, boundaries may be changed and new
counties established having a net tax capacity market value of
at least $2,500,000 $10,000,000.
No change in the boundaries of any county having an area of
more than 2,500 square miles, whether by the creation of a new
county, or otherwise, shall detach from the existing county any
territory within 12 miles of the county seat.
Sec. 13. Minnesota Statutes Second 1989 Supplement,
section 373.40, subdivision 1, is amended to read:
Subdivision 1. [DEFINITIONS.] For purposes of this
section, the following terms have the meanings given.
(a) "Bonds" means an obligation as defined under section
475.51.
(b) "Capital improvement" means acquisition or betterment
of public lands, buildings, or other improvements within the
county for the purpose of a county courthouse, administrative
building, health or social service facility, correctional
facility, jail, law enforcement center, hospital, morgue,
library, park, and roads and bridges. An improvement must have
an expected useful life of five years or more to qualify.
"Capital improvement" does not include light rail transit or any
activity related to it or a recreation or sports facility
building (such as, but not limited to, a gymnasium, ice arena,
racquet sports facility, swimming pool, exercise room or health
spa), unless the building is part of an outdoor park facility
and is incidental to the primary purpose of outdoor recreation.
(c) "Commissioner" means the commissioner of trade and
economic development.
(d) "Metropolitan county" means a county located in the
seven-county metropolitan area as defined in section 473.121 or
a county with a population of 90,000 or more.
(e) "Population" means the population established by the
most recent of the following (determined as of the date the
resolution authorizing the bonds was adopted):
(1) the federal decennial census,
(2) a special census conducted under contract by the United
States Bureau of the Census, or
(3) a population estimate made either by the metropolitan
council or by the state demographer under section 116K.04,
subdivision 4, clause (10).
(f) "Tax capacity" means total taxable tax capacity market
value, but does not include captured tax capacity market value.
Sec. 14. Minnesota Statutes 1989 Supplement, section
385.31, is amended to read:
385.31 [PAYMENT OF COUNTY ORDERS OR WARRANTS.]
When any order or warrant drawn on the treasurer is
presented for payment, if there is money in the treasury for
that purpose, the county treasurer shall redeem the same, and
write across the entire face thereof the word "redeemed," the
date of the redemption, and the treasurer's official signature.
If there is not sufficient funds in the proper accounts to pay
such orders they shall be numbered and registered in their order
of presentation, and proper endorsement thereof shall be made on
such orders and they shall be entitled to payment in like
order. Such orders shall bear interest at not to exceed the
rate of six percent per annum from such date of presentment.
The treasurer, as soon as there is sufficient money in the
treasury, shall appropriate and set apart a sum sufficient for
the payment of the orders so presented and registered, and, if
entitled to interest, issue to the original holder a notice that
interest will cease in 30 days from the date of such notice;
and, if orders thus entitled to priority of payment are not then
presented, the next in order of registry may be paid until such
orders are presented. No interest shall be paid on any order,
except upon a warrant drawn by the county auditor for that
purpose, giving the number and the date of the order on account
of which the interest warrant is drawn. In any county in this
state now or hereafter having a net tax capacity market value of
all taxable property, exclusive of money and credits, of not
less than $250,000,000 $1,033,000,000, the county treasurer, in
order to save payment of interest on county warrants drawn upon
a fund in which there shall be temporarily insufficient money in
the treasury to redeem the same, may borrow temporarily from any
other fund in the county treasury in which there is a sufficient
balance to care for the needs of such fund and allow a temporary
loan or transfer to any other fund, and may pay such warrants
out of such funds. Any such money so transferred and used in
redeeming such county warrants shall be returned to the fund
from which drawn as soon as money shall come in to the credit of
such fund on which any such warrant was drawn and paid as
aforesaid. Any county operating on a cash basis may use a
combined form of warrant or order and check, which, when signed
by the chair of the county board and by the auditor, is an order
or warrant for the payment of the claim, and, when countersigned
by the county treasurer, is a check for the payment of the
amount thereof.
Sec. 15. Minnesota Statutes 1989 Supplement, section
386.34, is amended to read:
386.34 [DEPUTIES, SALARIES.]
The county board of each county having a population of less
than 75,000, may by written order to be filed in the office of
the county auditor allow one deputy county recorder in such
county compensation for services as such deputy, to be fixed by
the board and specified in said order. In each county
containing less than 15 full and fractional congressional
townships, and having more than 16,000 and less than 19,000
inhabitants according to the 1940 federal census, and having a
net tax capacity market value of less
than $7,000,000 $29,000,000, exclusive of moneys and credits,
the county board may by written order to be filed in the office
of the county auditor allow one deputy county recorder in such
county compensation for services as such deputy not exceeding
$1,800 per year.
Sec. 16. Minnesota Statutes 1989 Supplement, section
412.081, subdivision 1, is amended to read:
Subdivision 1. [ELECTION, ASSESSMENT DISTRICTS.] Any
statutory city hereafter organized shall be constituted an
election and assessment district separate from the town in which
it lies immediately upon incorporation, except that if the
incorporation occurs between March 15 and July 1 the town
assessor shall assess the property in the city that year and the
city assessor shall not assume duties until the following year.
Where the town assessor makes the assessment, the city shall pay
such proportion of the cost of the assessment as its net tax
capacity bears to the assessed valuation net tax capacity of the
town, including the city.
Sec. 17. Minnesota Statutes 1989 Supplement, section
412.221, subdivision 2, is amended to read:
Subd. 2. [CONTRACTS.] The council shall have power to make
such contracts as may be deemed necessary or desirable to make
effective any power possessed by the council. The city may
purchase personal property through a conditional sales contract
and real property through a contract for deed under which
contracts the seller is confined to the remedy of recovery of
the property in case of nonpayment of all or part of the
purchase price, which shall be payable over a period of not to
exceed five years. When the contract price of property to be
purchased by contract for deed or conditional sales contract
exceeds one 0.24177 percent of the net tax capacity market value
of the city, the city may not enter into such a contract for at
least ten days after publication in the official newspaper of a
council resolution determining to purchase property by such a
contract; and, if before the end of that time a petition asking
for an election on the proposition signed by voters equal to ten
percent of the number of voters at the last regular city
election is filed with the clerk, the city may not enter into
such a contract until the proposition has been approved by a
majority of the votes cast on the question at a regular or
special election.
Sec. 18. Minnesota Statutes 1989 Supplement, section
430.102, subdivision 2, is amended to read:
Subd. 2. [COUNCIL APPROVAL; SPECIAL TAX LEVY LIMITATION.]
The council shall receive and consider the estimate required in
subdivision 1 and the items of cost after notice and hearing
before it or its appropriate committee as it considers necessary
or expedient, and shall approve the estimate, with necessary
amendments. The amounts of each item of cost estimated are then
appropriated to operate, maintain, and improve the pedestrian
mall during the next fiscal year. The amount of the special tax
to be charged under subdivision 1, clause (3), must not,
however, exceed 50 cents per $100 0.12089 percent of net tax
capacity market value of taxable property in the district. The
council shall make any necessary adjustment in costs of
operating and maintaining the district to keep the amount of the
tax within this limitation.
Sec. 19. Minnesota Statutes 1989 Supplement, section
465.04, is amended to read:
465.04 [ACCEPTANCE OF GIFTS.]
Cities of the second, third, or fourth class, having at any
time a net tax capacity market value of not more
than $10,000,000 $41,000,000, exclusive of money and credits, as
officially equalized by the commissioner of revenue, either
under home rule charter or under the laws of this state, in
addition to all other powers possessed by them, hereby are
authorized and empowered to receive and accept gifts and
donations for the use and benefit of such cities and the
inhabitants thereof upon terms and conditions to be approved by
the governing bodies of such cities; and such cities are
authorized to comply with and perform such terms and conditions,
which may include payment to the donor or donors of interest on
the value of the gift at not exceeding five percent per annum
payable annually or semiannually, during the remainder of the
natural life or lives of such donor or donors.
Sec. 20. Minnesota Statutes 1989 Supplement, section
471.24, is amended to read:
471.24 [STATUTORY CITIES AND TOWNS MAY JOIN IN MAINTAINING
CEMETERIES.]
Where a statutory city or town owns and maintains an
established cemetery or burial ground, either within or without
the municipal limits, the statutory city or town may, by mutual
agreement with contiguous statutory cities and towns, each
having a net tax capacity market value of not less
than $500,000 $2,000,000, join together in the maintenance of
such public cemetery or burial ground for the use of the
inhabitants of each of such municipalities; and each such
municipality is hereby authorized, by action of its council or
governing body, to levy a tax or make an appropriation for the
support and maintenance of such cemetery or burial ground;
provided, the amount thus levied or appropriated by each
municipality shall not exceed a total of $10,000 in any one year.
Sec. 21. Minnesota Statutes 1989 Supplement, section
471.73, is amended to read:
471.73 [ACCEPTANCE OF PROVISIONS.]
In the case of any city within the class specified in
471.72 having a net tax capacity market value, as defined in
section 471.72, in excess of $9,000,000 $37,000,000; and in the
case of any statutory city within such class having a net tax
capacity market value, as defined in section 471.72, of less
than $1,100,000 $5,000,000; and in the case of any statutory
city within such class which is governed by Laws 1933, chapter
211, or Laws 1937, chapter 356; and in the case of any statutory
city within such class which is governed by Laws 1929, chapter
208, and has a net tax capacity market value of less than
$20,000,000 $83,000,000; and in the case of any school district
within such class having a net tax capacity market value, as
defined in section 471.72, of more than $13,000,000 $54,000,000;
and in the case of all towns within said class; sections 471.71
to 471.83 apply only if the governing body of the city or
statutory city, the board of the school district, or the town
board of the town shall have adopted a resolution determining to
issue bonds under the provisions of sections 471.71 to 471.83 or
to go upon a cash basis in accordance with the provisions
thereof.
Sec. 22. Minnesota Statutes 1989 Supplement, section
475.58, subdivision 2, is amended to read:
Subd. 2. [FUNDING, REFUNDING.] Any city, town or school
district whose outstanding gross debt, including all items
referred to in section 475.51, subdivision 4, exceed in amount
6-2/3 1.62 percent of its net tax capacity market value may
issue bonds under this subdivision for the purpose of funding or
refunding such indebtedness or any part thereof. A list of the
items of indebtedness to be funded or refunded shall be made by
the recording officer and treasurer and filed in the office of
the recording officer. The initial resolution of the governing
body shall refer to this subdivision as authority for the issue,
state the amount of bonds to be issued and refer to the list of
indebtedness to be funded or refunded. This resolution shall be
published once each week for two successive weeks in a legal
newspaper published in the municipality or if there be no such
newspaper, in a legal newspaper published in the county seat.
Such bonds may be issued without the submission of the question
of their issue to the electors unless within ten days after the
second publication of the resolution a petition requesting such
election signed by ten or more voters who are taxpayers of the
municipality, shall be filed with the recording officer. In
event such petition is filed, no bonds shall be issued hereunder
unless authorized by a majority of the electors voting on the
question.
Sec. 23. Minnesota Statutes 1989 Supplement, section
475.73, subdivision 1, is amended to read:
Subdivision 1. Obligations sold under the provisions of
section 475.60 may be purchased by the state board of investment
if the obligations meet the requirements of section 11A.24,
subdivision 2, upon the approval of the attorney general as to
form and execution of the application therefor, and under rules
as the board may specify, and the state board shall have
authority to purchase the same to an amount not exceeding 15
3.63 percent of the net tax capacity market value of the taxable
property of the municipality, according to the last preceding
assessment. The obligations shall not run for a shorter period
than one year, nor for a longer period than 30 years and shall
bear interest at a rate to be fixed by the state board but not
less than two percent per annum. Forthwith upon the delivery to
the state of Minnesota of any obligations issued by virtue
thereof, the commissioner of finance shall certify to the
respective auditors of the various counties wherein are situated
the municipalities issuing the same, the number, denomination,
amount, rate of interest and date of maturity of each obligation.
Sec. 24. Minnesota Statutes 1989 Supplement, section
505.173, subdivision 1, is amended to read:
Subdivision 1. [CERTAIN DEFECTS.] In all cases where the
plats, or what purports to be plats, of any portion of the lands
contained within any additions to or subdivisions of any town or
city, situated in any county having less than 15 full and
fractional congressional townships, having less than 15,000
inhabitants according to the 1940 federal census, and having an
net tax capacity assessed value of more than $7,500,000 and less
than $8,500,000, exclusive of money and credits which have been
executed and filed in an office of any county recorder previous
to January 1, 1915, (1) fail to identify or correctly describe
the land to be so platted or to show correctly upon their face
the tract of land intended or purported to be platted thereby,
or (2) are defective by reason of the plat and the description
of the land purported to be so platted thereby being
inconsistent or incorrect, or (3) there exists a defect in the
execution of said plats on the part of the grantors thereof, the
governing board or council of the municipality containing land
so platted or purported to be so platted may authorize, within
two years from April 21, 1951, referring by the record book and
page of such plat or plats in the office of the county recorder
to the plat or plats to be corrected, the making of one or more
plats which shall correctly show on the face thereof and by
description of the land intended to be platted, which plat or
plats may vary from the original plats in description as to lots
and blocks to suit the best purpose and secure the best
results. Such plat or plats, in a declaration thereon, shall
recite such resolution and shall identify each separate tract of
land described therein with such tract of land in the purported
plat or plats intended to be corrected thereby, and shall be
certified by the proper officers of the municipality as to
authorization and by an engineer or surveyor as to correctness,
and the signatures of such persons shall be acknowledged in like
manner as a deed.
Sec. 25. [EFFECTIVE DATE.]
Section 22 is effective for bonds issued after the date of
enactment of this act. The remainder of this article is
effective the day following final enactment of this act.
ARTICLE 10
MISCELLANEOUS
Section 1. Minnesota Statutes 1989 Supplement, section
270.73, subdivision 1, is amended to read:
Subdivision 1. [POSTING, NOTICE.] Pursuant to the
authority to disclose under section 270B.12, subdivision 4, the
commissioner shall, by the 15th of each month, submit to the
commissioner of public safety a list of all taxpayers who are
required to withhold or collect the tax imposed by section
290.92 or 297A.02 or a local option tax administered and
collected by the commissioner of revenue and who are 30 days or
more delinquent in either filing a tax return or paying the tax.
The commissioner of revenue is under no obligation to list
a taxpayer whose business is inactive. At least ten days before
notifying the commissioner of public safety, the commissioner of
revenue shall notify the taxpayer of the intended action.
The commissioner of public safety shall post the list in
the same manner as provided in section 340A.318, subdivision 3.
The list will prominently show the date of posting. If a
taxpayer previously listed cures the delinquency by filing all
returns and paying all taxes, the commissioner shall notify the
commissioner of public safety within two business days that the
delinquency was cured.
Sec. 2. Minnesota Statutes 1988, section 270A.03,
subdivision 2, is amended to read:
Subd. 2. "Claimant agency" means any state agency, as
defined by section 14.02, subdivision 2, the regents of the
University of Minnesota, any district court of the state, any
county, any statutory or home rule charter city presenting a
claim for a municipal hospital, a hospital district, any public
agency responsible for child support enforcement, and any public
agency responsible for the collection of court-ordered
restitution.
Sec. 3. Minnesota Statutes 1988, section 270A.03,
subdivision 5, is amended to read:
Subd. 5. "Debt" means a legal obligation of a natural
person to pay a fixed and certain amount of money, which equals
or exceeds $25 and which is due and payable to a claimant
agency. The term includes criminal fines imposed under section
609.10 and restitution. A debt may arise under a contractual or
statutory obligation, a court order, or other legal obligation,
but need not have been reduced to judgment.
A debt does not include (1) any legal obligation of a
current recipient of assistance which is based on overpayment of
an assistance grant, or (2).
A debt does not include any legal obligation to pay a
claimant agency for medical care, including hospitalization if
the income of the debtor would have qualified for a low income
credit equal to tax liability pursuant to Minnesota Statutes
1984, section 290.06, subdivision 3d, clause (1), at the time
when the medical care was rendered, provided that, for purposes
of this subdivision, does not exceed the following amount:
(1) for an unmarried debtor, an income of $6,400 or less;
(2) for a debtor with one dependent, an income of $8,200 or
less;
(3) for a debtor with two dependents, an income of $9,700
or less;
(4) for a debtor with three dependents, an income of
$11,000 or less;
(5) for a debtor with four dependents, an income of $11,600
or less; and
(6) for a debtor with five or more dependents, an income of
$12,100 or less.
The income amounts in that section this subdivision shall
be adjusted for inflation for debts incurred in calendar
years 1987 1991 and thereafter. The dollar amount of each
income level that applied to debts incurred in the prior year
shall be increased in the same manner as provided in section
290.06, subdivision 2d, for the expansion of the tax rate
brackets.
Sec. 4. Minnesota Statutes 1988, section 270A.03,
subdivision 7, is amended to read:
Subd. 7. "Refund" means an individual income tax refund,
pursuant to chapter 290, or a property tax credit or refund,
pursuant to chapter 290A.
For purposes of this chapter, lottery prizes, as set forth
in section 349A.08, subdivision 8, shall be treated as refunds.
Sec. 5. Minnesota Statutes 1988, section 270A.04,
subdivision 2, is amended to read:
Subd. 2. Any debt owed to a claimant agency shall be
submitted by the agency for collection under the procedure
established by sections 270A.01 to 270A.12 unless (a) an
alternative means of collection is pending and believed to be
adequate the debtor is complying with the terms of alternative
means of collection, (b) the collection attempt would result in
a loss of federal funds, or (c) the agency is unable to supply
the department with the necessary identifying information
required by subdivision 3 or rules promulgated by the
commissioner, or (d) the debt is barred by section 541.05.
Sec. 6. Minnesota Statutes 1988, section 270A.08,
subdivision 2, is amended to read:
Subd. 2. (a) This written notice shall clearly and with
specificity set forth the basis for the claim to the refund
including the name of the benefit program involved if the debt
arises from a public assistance grant and the dates on which the
debt was incurred and, further, shall advise the debtor of the
claimant agency's intention to request setoff of the refund
against the debt.
(b) The notice will also advise the debtor that any debt
incurred more than six years from the date of the notice to the
commissioner under section 270A.07 must not be setoff against a
refund and will advise the debtor of the right to contest the
validity of the claim at a hearing. The debtor must assert this
right by written request to the claimant agency, which request
the agency must receive within 45 days of the mailing date of
the original notice or of the corrected notice, as required by
subdivision 1. If the debtor has not received the notice, the
45 days shall not commence until the debtor has received actual
notice. The debtor shall have the burden of showing no notice
and shall be entitled to a hearing on the issue of notice as
well as on the merits.
Sec. 7. Minnesota Statutes 1989 Supplement, section
270B.07, is amended by adding a subdivision to read:
Subd. 5. [INQUIRIES RELATED TO APPLICATIONS FOR LIQUOR
LICENSES.] The commissioner may disclose and certify to a
requesting county or municipality whether or not an applicant
for a license to be issued under section 340A.403 or sections
340A.404 to 340A.406 is liable for state or local taxes or
assessments that were not paid when they became due. The
commissioner shall not disclose or certify that the license
applicant is liable for unpaid state or local taxes or
assessments if an administrative or court action which questions
the amount or validity of the unpaid taxes or assessments has
been commenced, or if the appeal period to contest the taxes or
assessments has not yet expired.
Sec. 8. Minnesota Statutes Second 1989 Supplement, section
349.212, subdivision 4, is amended to read:
Subd. 4. [PULL-TAB AND TIPBOARD TAX.] (a) There is imposed
a tax on the sale of each deal of pull-tabs and tipboards sold
by a licensed distributor. The rate of the tax is two percent
of the ideal gross of the pull-tab or tipboard deal. The sales
tax imposed by chapter 297A on the sale of the pull-tabs and
tipboards by the licensed distributor is imposed on the retail
sales price less the tax imposed by this subdivision. The
retail sale of pull-tabs or tipboards by the organization is
exempt from taxes imposed by chapter 297A if the tax imposed by
this subdivision has been paid and is exempt from all local
taxes and license fees except a fee authorized under section
349.16, subdivision 4.
(b) The liability for the tax imposed by this section is
incurred when the pull-tabs and tipboards are delivered by the
distributor to the customer, to a common or contract carrier for
delivery to the customer, or when received by the customer's
authorized representative at the distributor's place of
business, regardless of the distributor's method of accounting
or the terms of the sale.
The tax imposed by this subdivision is imposed on all sales
of pull-tabs and tipboards, except the following:
(1) sales to the governing body of an Indian tribal
organization for use on an Indian reservation;
(2) sales to distributors licensed under this chapter;
(3) sales to distributors licensed under the laws of
another state or of a Province of Canada, as long as all
statutory and regulatory requirements are met in the other state
or province; and
(4) sales of promotional tickets as defined in section
349.12.
(c) Pull-tabs and tipboards sold to an organization that
sells pull-tabs and tipboards under the exemption from licensing
in section 349.214, subdivision 2, paragraph (b), are exempt
from the tax imposed by this subdivision. A distributor must
require an organization conducting exempt gambling to show proof
of its exempt status before making a tax-exempt sale of
pull-tabs or tipboards to such an organization. A distributor
shall identify, on all reports submitted to the commissioner,
all sales of pull-tabs and tipboards that are exempt from tax
under this subdivision.
Sec. 9. Minnesota Statutes 1988, section 349.212, is
amended by adding a subdivision to read:
Subd. 7. [UNTAXED PULL-TABS AND TIPBOARDS.] In addition to
penalties or criminal sanctions imposed by this chapter, any
person, organization, or business entity possessing a pull-tab
or tipboard upon which the tax imposed by subdivision 4 has not
been paid is liable for a tax of six percent of the ideal gross
of each pull-tab or tipboard. The tax on a partial deal shall
be assessed as if it were a full deal.
The tax shall be assessed by the commissioner. An
assessment shall be considered a jeopardy assessment or jeopardy
collection as provided in section 270.70. The commissioner
shall assess the tax based on personal knowledge or information
available to the commissioner. The commissioner shall mail to
the taxpayer at the taxpayer's last known address, or serve in
person, a written notice of the amount of tax, demand its
immediate payment, and, if payment is not immediately made,
collect the tax by any method described in chapter 270, except
that the commissioner need not await the expiration of the times
specified in chapter 270. The tax assessed by the commissioner
is presumed to be valid and correctly determined and assessed.
The burden is upon the taxpayer to show its incorrectness or
invalidity.
Sec. 10. Minnesota Statutes 1989 Supplement, section
383.06, is amended to read:
383.06 [PAYMENT OF WARRANTS; ACCOUNTS; HOW KEPT;
CERTIFICATES OF INDEBTEDNESS TO RETIRE OUTSTANDING WARRANTS.]
The county treasurer shall pay warrants only from the fund
from which they are legally payable. Payments under any special
contract shall be kept separate under the name of such contract,
and under the general title of the fund from which such payment
may be legally made. The treasurer need not keep a specific
appropriations account separately, but shall keep a general
appropriations account.
In any county having a net tax capacity of not less than
$150,000,000, exclusive of money and credits, The county board
may, by resolution, issue and sell as many certificates of
indebtedness as may be needed in anticipation of the collection
of taxes levied for any fund named in the tax levy for the
purpose of raising money for such fund, but the certificates
outstanding for any such separate funds shall not at any time
exceed 50 percent of the amount of taxes previously levied for
such fund remaining uncollected, and no certificate shall be
issued to become due and payable later than December 31 of the
year succeeding the year in which the tax levy was made, and the
certificates shall not be sold for less than par and accrued
interest and shall not bear a greater rate of interest than six
percent per annum. No such certificates shall be issued prior
to the beginning of the fiscal year for which the taxes so
anticipated were intended, except that when taxes shall have
been levied for the purpose of paying a deficit in any such fund
carried over from any previous year or years certificates of
indebtedness in anticipation of collection of the taxes levied
for such deficit may be issued at any time after such levy shall
have been finally made and certified to the county auditor.
Each certificate shall state upon its face for which fund the
proceeds thereof shall be used, the total amount of certificates
so issued, and the whole amount embraced in the levy for that
particular purpose. They shall be numbered consecutively, be in
denominations of $100 or a multiple thereof, may have interest
coupons attached, shall be otherwise of such form and terms, and
may be made payable at such place, as will best aid in their
negotiation, and the proceeds of the tax assessed and collected
on account of the fund and the full faith and credit of the
county shall be irrevocably pledged for the redemption and
payment of the certificates so issued. Such certificates shall
be payable primarily from the moneys derived from the levy for
the years against which such certificates were issued, but shall
constitute unlimited general obligations of the county. Moneys
derived from the sale of such certificates shall be credited to
the fund or funds the taxes for which are so anticipated.
Sec. 11. Minnesota Statutes 1988, section 524.3-301, is
amended to read:
524.3-301 [INFORMAL PROBATE OR APPOINTMENT PROCEEDINGS;
APPLICATION; CONTENTS.]
An informal probate proceeding is an informal proceeding
for the probate of decedent's will with or without an
application for informal appointment. An informal appointment
proceeding is an informal proceeding for appointment of a
personal representative in testate or intestate estates. These
proceedings may be combined in a single proceeding.
Applications for informal probate or informal appointment shall
be directed to the registrar, and verified by the applicant, in
accordance with section 524.1-310, to be accurate and complete
to the best of applicant's knowledge and belief as to the
following information:
(1) Every application for informal probate of a will or for
informal appointment of a personal representative, other than a
special or successor representative, shall contain the following:
(i) a statement of the interest of the applicant;
(ii) the name, social security number, birthdate, and date
of death of the decedent, and the county and state of the
decedent's domicile at the time of death, and the names and
addresses of the spouse, children, heirs, and devisees and the
ages of any who are minors so far as known or ascertainable with
reasonable diligence by the applicant;
(iii) if the decedent was not domiciled in the state at the
time of death, a statement showing venue;
(iv) a statement identifying and indicating the address of
any personal representative of the decedent appointed in this
state or elsewhere whose appointment has not been terminated;
(v) a statement indicating whether the applicant has
received a demand for notice, or is aware of any demand for
notice of any probate or appointment proceeding concerning the
decedent that may have been filed in this state or elsewhere.
(2) An application for informal probate of a will shall
state the following in addition to the statements required by
(1):
(i) that the original of the decedent's last will is in the
possession of the court, or accompanies the application, or that
an authenticated copy of a will probated in another jurisdiction
accompanies the application;
(ii) that the applicant, to the best of the applicant's
knowledge, believes the will to have been validly executed;
(iii) that after the exercise of reasonable diligence, the
applicant is unaware of any instrument revoking the will, and
that the applicant believes that the instrument which is the
subject of the application is the decedent's last will;
(iv) that the time limit for informal probate as provided
in this article has not expired either because three years or
less have passed since the decedent's death, or, if more than
three years from death have passed, that circumstances as
described by section 524.3-108 authorizing tardy probate have
occurred.
(3) An application for informal appointment of a personal
representative to administer an estate under a will shall
describe the will by date of execution and state the time and
place of probate or the pending application or petition for
probate. The application for appointment shall adopt the
statements in the application or petition for probate and state
the name, address and priority for appointment of the person
whose appointment is sought.
(4) An application for informal appointment of an
administrator in intestacy shall state in addition to the
statements required by (1):
(i) that after the exercise of reasonable diligence, the
applicant is unaware of any unrevoked testamentary instrument
relating to property having a situs in this state under section
524.1-301, or, a statement why any such instrument of which the
applicant may be aware is not being probated;
(ii) the priority of the person whose appointment is sought
and the names of any other persons having a prior or equal right
to the appointment under section 524.3-203.
(5) An application for appointment of a personal
representative to succeed a personal representative appointed
under a different testacy status shall refer to the order in the
most recent testacy proceeding, state the name and address of
the person whose appointment is sought and of the person whose
appointment will be terminated if the application is granted,
and describe the priority of the applicant.
(6) An application for appointment of a personal
representative to succeed a personal representative who has
tendered a resignation as provided in section 524.3-610(c), or
whose appointment has been terminated by death or removal, shall
adopt the statements in the application or petition which led to
the appointment of the person being succeeded except as
specifically changed or corrected, state the name and address of
the person who seeks appointment as successor, and describe the
priority of the applicant.
Sec. 12. [REPEALER.]
Minnesota Statutes 1988, sections 290.612; and 297A.431,
are repealed.
Sec. 13. [EFFECTIVE DATE.]
Sections 1 to 12 are effective the day following final
enactment.
Presented to the governor April 24, 1990
Signed by the governor April 24, 1990, 9:15 p.m.
Official Publication of the State of Minnesota
Revisor of Statutes