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Minnesota Legislature

Office of the Revisor of Statutes

Key: (1) language to be deleted (2) new language

                             CHAPTER 84-H.F.No. 807 
                  An act relating to taxation; making policy changes to 
                  income and withholding taxes, property taxes, mortgage 
                  registry and deed taxes, sales and use taxes, 
                  MinnesotaCare taxes, and tax collections; providing 
                  civil penalties; amending Minnesota Statutes 1996, 
                  sections 8.30; 60A.15, subdivision 1; 270.02, 
                  subdivision 3; 270.063; 270.10, subdivisions 1 and 5; 
                  270.101, subdivisions 2, 3, and by adding a 
                  subdivision; 270.271, by adding a subdivision; 
                  270.273, subdivision 2; 270.276, subdivision 2; 
                  270.67, subdivision 2; 270.68, subdivision 1; 270.69, 
                  subdivision 11; 270.701, subdivisions 2 and 5; 
                  270.708, subdivision 1; 270.721; 270.73, subdivision 
                  1; 271.06, subdivision 2; 271.08, subdivision 1; 
                  271.10, subdivision 2; 275.075; 287.08; 287.28; 
                  287.31, subdivision 1; 289A.08, subdivision 3; 
                  289A.09, subdivision 2; 289A.20, subdivisions 1 and 2; 
                  289A.31, subdivision 1; 289A.36, subdivision 4; 
                  289A.37, subdivision 1; 289A.40, subdivisions 1 and 2; 
                  289A.60, subdivision 15; 290.095, subdivision 3; 
                  290.17, subdivision 2; 290.35, subdivision 2; 290A.04, 
                  subdivision 2h; 295.50, subdivisions 3 and 14; 295.52, 
                  subdivision 4; 295.53, subdivision 4; 295.55, 
                  subdivision 2; 297A.01, by adding a subdivision; 
                  297A.041; 297A.07, subdivision 3; 297A.24, by adding a 
                  subdivision; 297A.25, subdivisions 12 and 41; 297A.45, 
                  subdivision 4; 297B.035, subdivision 3; 297B.11; 
                  299F.21; 515B.1-105; and 515B.1-116; Laws 1995, 
                  chapter 264, article 10, section 15; proposing coding 
                  for new law in Minnesota Statutes, chapters 270; and 
                  287. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
                                   ARTICLE 1
                                 PROPERTY TAXES
           Section 1.  Minnesota Statutes 1996, section 275.075, is 
        amended to read: 
           275.075 [OMISSION BY INADVERTENCE; CORRECTION.] 
           Whenever the amount of taxes as levied and certified by the 
        tax levying body of any county, city, town, special taxing 
        district, or school district has not been, as the result of 
        error, inadvertence, or from the estimates as provided in 
        section 275.08, by the county auditor extended and spread in 
        conformity therewith, such tax levying body may include in its 
        tax levy for the year following, the whole or any part of the 
        amount so omitted through error, inadvertence, or from the 
        estimates as provided in section 275.08, in addition to its 
        current levy and in addition to and notwithstanding any 
        limitations to the contrary. 
           Sec. 2.  Minnesota Statutes 1996, section 287.08, is 
        amended to read: 
           287.08 [TAX, HOW PAYABLE; RECEIPTS.] 
           (a) The tax imposed by sections 287.01 to 287.12 shall be 
        paid to the treasurer of the county in which the mortgaged land 
        or some part thereof is situated at or before the time of filing 
        the mortgage for record or registration.  The treasurer shall 
        endorse receipt on the mortgage, countersigned by the county 
        auditor, who shall charge the amount to the treasurer and such 
        receipt shall be recorded with the mortgage, and such receipt of 
        the record thereof shall be conclusive proof that the tax has 
        been paid to the amount therein stated and authorize any county 
        recorder to record the mortgage.  Its form, in substance, shall 
        be "registration tax hereon of ..................... dollars 
        paid."  If the mortgages be exempt from taxation the endorsement 
        shall be "exempt from registration tax," to be signed in either 
        case by the treasurer as such, and in case of payment to be 
        countersigned by the auditor.  In case the treasurer shall be 
        unable to determine whether a claim of exemption should be 
        allowed, the tax shall be paid to the court administrator of as 
        in the case of a taxable mortgage.  
           (b) Upon written application of the taxpayer, the county 
        treasurer may refund in whole or in part any tax which has been 
        erroneously paid, or a person having paid a mortgage registry 
        tax amount may seek a refund of such tax, or other appropriate 
        relief, by bringing an action in the district tax court of in 
        the county to abide the order of such court made upon motion of 
        the county attorney, or of the claimant upon notice as required 
        by the court. in which the tax was paid, within 60 days of the 
        payment.  The action is commenced by the serving of a petition 
        for relief on the county treasurer, and by filing a copy with 
        the court.  The county attorney shall defend the action.  The 
        county treasurer shall notify the treasurer of each county that 
        has or would receive a portion of the tax as paid.  
           (c) If the county treasurer determines a refund should be 
        paid, or if a refund is ordered, the county treasurer of each 
        county that actually received a portion of the tax shall 
        immediately pay a proportionate share of three percent of the 
        refund using any available county funds.  The county treasurer 
        of each county which received, or would have received, a portion 
        of the tax shall also pay their county's proportionate share of 
        the remaining 97 percent of the court-ordered refund on or 
        before the tenth day of the following month using solely the 
        mortgage registry tax funds that would be paid to the 
        commissioner of revenue on that date under section 287.12.  If 
        the funds on hand under this procedure are insufficient to fully 
        fund 97 percent of the court ordered refund, the county 
        treasurer of the county in which the action was brought shall 
        file a claim with the commissioner of revenue under section 
        16A.48 for the remaining portion of 97 percent of the refund, 
        and shall pay over the remaining portion upon receipt of a 
        warrant from the state issued pursuant to the claim.  
           (d) When any such mortgage covers real property situate in 
        more than one county in this state the whole of such tax shall 
        be paid to the treasurer of the county where the mortgage is 
        first presented for record or registration, and the payment 
        shall be receipted and countersigned as above provided.  The tax 
        shall be divided and paid over by the county treasurer receiving 
        the same, on or before the tenth day of each month after receipt 
        thereof, to the county or counties entitled thereto in the ratio 
        which the market value of the real property covered by the 
        mortgage in each county bears to the market value of all the 
        property described in the mortgage.  In making such division and 
        payment the county treasurer shall send therewith a statement 
        giving the description of the property described in the mortgage 
        and the market value of the part thereof situate in each 
        county.  For the purpose aforesaid, the treasurer of any county 
        may require the treasurer of any other county to certify to the 
        former the market valuation of any tract of land in any such 
        mortgage. 
           Sec. 3.  Minnesota Statutes 1996, section 287.28, is 
        amended to read: 
           287.28 [REFUNDMENTS REFUNDS OR REDEMPTION.] 
           (a) The county treasurer may order the refundment refund in 
        whole or in part of any tax which has been erroneously or 
        unjustly paid and may allow for or redeem such of the stamps, 
        issued under the authority of sections 287.21 to 287.36 as may 
        have been spoiled, destroyed, or rendered useless or unfit for 
        the purpose intended or for which the owner may have no use or 
        which through mistake may have been improperly or unnecessarily 
        used.  Such order shall be made only upon written application of 
        the taxpayer and upon approval of the county board.  Refunds 
        therefor shall be paid out of the general fund of the county.  
           (b) A person having paid a deed tax amount may seek a 
        refund of the tax, or other appropriate relief, by commencing an 
        action in tax court in the county where the tax was paid, within 
        60 days of the payment.  The action is commenced by serving a 
        petition for relief on the county treasurer, and filing a copy 
        with the court.  The county attorney shall defend the action.  
        The county treasurer shall notify the treasurer of each county 
        that has, or would receive a portion of the tax as paid.  Any 
        refund of deed tax which the county treasurer determines should 
        be made, and any court ordered refund of deed tax, shall be 
        accomplished using the refund procedures in section 287.08. 
           Sec. 4.  Minnesota Statutes 1996, section 290A.04, 
        subdivision 2h, is amended to read: 
           Subd. 2h.  (a) If the gross property taxes payable on a 
        homestead increase more than 12 percent over the net property 
        taxes payable in the prior year on the same property that is 
        owned and occupied by the same owner on January 2 of both years, 
        and the amount of that increase is $100 or more for taxes 
        payable in 1996 and 1997, a claimant who is a homeowner shall be 
        allowed an additional refund equal to 60 percent of the amount 
        of the increase over the greater of 12 percent of the prior 
        year's net property taxes payable or $100 for taxes payable in 
        1996 and 1997.  This subdivision shall not apply to any increase 
        in the gross property taxes payable attributable to improvements 
        made to the homestead after the assessment date for the prior 
        year's taxes.  This subdivision shall not apply to any increase 
        in the gross property taxes payable attributable to the 
        termination of valuation exclusions under section 273.11, 
        subdivision 16. 
           The maximum refund allowed under this subdivision is $1,000.
           (b) For purposes of this subdivision, the following terms 
        have the meanings given: 
           (1) "Net property taxes payable" means property taxes 
        payable minus 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. 
           (d) On or before December 1, 1995, the commissioner shall 
        estimate the cost of making the payments provided by this 
        subdivision for taxes payable in 1996.  Notwithstanding the open 
        appropriation provision of section 290A.23, if the estimated 
        total refund claims for taxes payable in 1996 exceed $5,500,000, 
        the commissioner shall first reduce the 60 percent refund rate 
        enough, but to no lower a rate than 50 percent, so that the 
        estimated total refund claims do not exceed $5,500,000.  If the 
        commissioner estimates that total claims will exceed $5,500,000 
        at a 50 percent refund rate, the commissioner shall also reduce 
        the $1,000 maximum refund amount by enough so that total 
        estimated refund claims do not exceed $5,500,000. 
           The determinations of the revised thresholds by the 
        commissioner are not rules subject to chapter 14.  
           (e) Upon request, the appropriate county official shall 
        make available the names and addresses of the property taxpayers 
        who may be eligible for the additional property tax refund under 
        this section.  The information shall be provided on a magnetic 
        computer disk.  The county may recover its costs by charging the 
        person requesting the information the reasonable cost for 
        preparing the data.  The information may not be used for any 
        purpose other than for notifying the homeowner of potential 
        eligibility and assisting the homeowner, without charge, in 
        preparing a refund claim. 
           Sec. 5.  Minnesota Statutes 1996, section 515B.1-105, is 
        amended to read: 
           515B.1-105 [SEPARATE TITLES AND TAXATION.] 
           (a) In a cooperative: 
           (1) The unit owners' interests in units and their allocated 
        interests are wholly personal property, unless the declaration 
        provides that the interests are wholly real estate.  The 
        characterization of these interests as real or personal property 
        shall not affect whether homestead exemptions or classifications 
        apply. 
           (2) The ownership interest in a unit which may be sold, 
        conveyed, voluntarily or involuntarily encumbered, or otherwise 
        transferred by a unit owner, is the right to possession of that 
        unit under a proprietary lease coupled with the allocated 
        interests of that unit, and the association's interest in that 
        unit is not affected by the transaction. 
           (b) In a condominium or planned community: 
           (1) Each unit, and its allocated interest in the common 
        elements, constitutes a separate parcel of real estate. 
           (2) If there is any unit owner other than a declarant, each 
        unit shall be separately taxed and assessed, and no separate tax 
        or assessment may be rendered against any common elements. 
           (c) If a declaration is recorded prior to 30 days before 
        any installment of real estate taxes becomes payable, the local 
        taxing authority shall split the taxes so payable on the common 
        interest community among the units.  Interest and penalties 
        which would otherwise accrue shall not begin to accrue until at 
        least 30 days after the split is accomplished. 
           (d) A unit used for residential purposes together with not 
        more than three units used for vehicular parking, and their 
        common element interests, shall be treated as one parcel of real 
        estate in determining whether homestead exemptions or 
        classifications apply. 
           Sec. 6.  Minnesota Statutes 1996, section 515B.1-116, is 
        amended to read: 
           515B.1-116 [RECORDING.] 
           (a) A declaration, bylaws, any amendment to a declaration 
        or bylaws, and any other instrument affecting a common interest 
        community shall be entitled to be recorded.  In those counties 
        which have a tract index, the county recorder shall enter the 
        declaration in the tract index for each unit affected.  The 
        registrar of titles shall file the declaration on the 
        certificate of title for each unit affected. 
           (b) The recording officer shall upon request promptly 
        assign a number (CIC number) to a common interest community to 
        be formed or to a common interest community resulting from the 
        merger of two or more common interest communities. 
           (c) Documents recorded pursuant to this chapter shall in 
        the case of registered land be filed, and references to the 
        recording of documents shall mean filed in the case of 
        registered land. 
           (d) Subject to any specific requirements of this chapter, 
        if any document to be recorded pursuant to this chapter requires 
        approval by a certain vote or agreement of the unit owners or 
        secured parties, an affidavit of the secretary of the 
        association stating that the required vote or agreement has 
        occurred shall be attached to the document and shall constitute 
        prima facie evidence of the representations contained therein. 
           (e) If a common interest community is located on registered 
        land, the recording fee for any document affecting two or more 
        units shall be the then-current fee for registering the document 
        on the certificates of title for the first ten affected 
        certificates and one-third of the then-current fee for each 
        additional affected certificate.  This provision shall not apply 
        to recording fees for deeds of conveyance, with the exception of 
        deeds given pursuant to sections 515B.2-119 and 515B.3-112. 
           (f) Except as permitted under this subsection, a recording 
        officer shall not file or record a declaration creating a new 
        common interest community, unless the county treasurer has 
        certified that the property taxes payable in the current year 
        for the real estate included in the proposed common interest 
        community have been paid.  This certification is in addition to 
        the certification for delinquent taxes required by section 
        272.12.  In the case of preexisting common interest communities, 
        the recording officer shall accept, file, and record the 
        following instruments, without requiring a certification as to 
        the current or delinquent taxes on any of the units in the 
        common interest community:  (i) a declaration subjecting the 
        common interest community to this chapter; (ii) a declaration 
        changing the form of a common interest community pursuant to 
        section 515B.2-123; or (iii) an amendment to or restatement of a 
        the declaration or, bylaws, or an amended CIC plat, approved 
        by the required vote of unit owners of an association may be 
        recorded without the necessity of paying the current or 
        delinquent taxes on any of the units in the common interest 
        community.  In order for the instruments to be accepted and 
        recorded under the preceding sentence, the assessor must certify 
        or otherwise inform the recording officer that, for taxes 
        payable in the current year, the assessor has allocated taxable 
        values to each unit or has separately assessed each unit. 
           (g) The registrar of titles shall not require the filing on 
        certificates of title previously issued for units in a flexible 
        common interest community of an amendment to a declaration 
        pursuant to section 515B.2-111 made solely to add additional 
        real estate. 
           Sec. 7.  [EFFECTIVE DATE.] 
           Section 1 is effective for taxes payable in 1998 and 
        thereafter.  Sections 2, 3, and 4 are effective the day 
        following final enactment.  Sections 5 and 6 are effective for 
        declarations submitted for recording on or after July 1, 1997. 
                                   ARTICLE 2  
                             INCOME AND WITHHOLDING 
           Section 1.  Minnesota Statutes 1996, section 289A.08, 
        subdivision 3, is amended to read: 
           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 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.  All members of an affiliated group 
        that elect to are required to file a combined report must 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.  
           Sec. 2.  Minnesota Statutes 1996, section 290.095, 
        subdivision 3, is amended to read: 
           Subd. 3.  [CARRYOVER.] (a) A net operating loss incurred in 
        a taxable year:  (i) beginning after December 31, 1986, shall be 
        a net operating loss carryover to each of the 15 taxable years 
        following the taxable year of such loss; (ii) beginning before 
        January 1, 1987, shall be a net operating loss carryover to each 
        of the five taxable years following the taxable year of such 
        loss subject to the provisions of Minnesota Statutes 1986, 
        section 290.095; and (iii) beginning before January 1, 1987, 
        shall be a net operating loss carryback to each of the three 
        taxable years preceding the loss year subject to the provisions 
        of Minnesota Statutes 1986, section 290.095. 
           (b) The entire amount of the net operating loss for any 
        taxable year shall be carried to the earliest of the taxable 
        years to which such loss may be carried.  The portion of such 
        loss which shall be carried to each of the other taxable years 
        shall be the excess, if any, of the amount of such loss over the 
        sum of the taxable net income, adjusted by the modifications 
        specified in subdivision 4, for each of the taxable years to 
        which such loss may be carried. 
           (c) Where a corporation does business both within and 
        without Minnesota, and apportions its income under the 
        provisions of section 290.191, the net operating loss deduction 
        incurred in any taxable year shall be allowed to the extent of 
        the apportionment ratio of the loss year. 
           (d) The provisions of sections 381, 382, and 384 of the 
        Internal Revenue Code apply to carryovers in certain corporate 
        acquisitions and special limitations on net operating loss 
        carryovers.  The limitation amount determined under section 382 
        shall be applied to net income, before apportionment, in each 
        post change year to which a loss is carried. 
           Sec. 3.  Minnesota Statutes 1996, 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.  For purposes 
        of this paragraph, off-season training activities, unless 
        conducted at the team's facilities as part of a team imposed 
        program, are not included in the total number of duty days.  
        Bonuses earned as a result of play during the regular season or 
        for participation in championship, play-off, or all-star games 
        must be allocated under the formula.  Signing bonuses are not 
        subject to allocation under the formula if they are not 
        conditional on playing any games for the team, are payable 
        separately from any other compensation, and are nonrefundable; 
        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 as "retirement income" as defined in section (b)(1) 
        of the State Income Taxation of Pension Income Act, Public Law 
        Number 104-95, 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) 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 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.  
           When an employer pays an employee for a covenant not to 
        compete, the income allocated to this state is in the ratio of 
        the employee's service in Minnesota in the calendar year 
        preceding leaving the employment of the employer over the total 
        services performed by the employee for the employer in that year.
           (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 24, 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. 4.  Minnesota Statutes 1996, section 290.35, 
        subdivision 2, is amended to read: 
           Subd. 2.  [APPORTIONMENT OF TAXABLE NET INCOME.] The 
        commissioner shall compute therefrom the taxable net income of 
        such companies by assigning to this state that proportion 
        thereof which the gross premiums collected by them during the 
        taxable year from old and new business within this state bears 
        to the total gross premiums collected by them during that year 
        from their entire old and new business, including reinsurance 
        premiums; provided, the commissioner shall add to the taxable 
        net income so apportioned to this state the amount of any taxes 
        on premiums paid by the company by virtue of any law of this 
        state (other than the surcharge on premiums imposed by sections 
        69.54 to 69.56 and the surcharge imposed by section 168A.40, 
        subdivision 3) which shall have been deducted from gross income 
        by the company in arriving at its total net income under the 
        provisions of such act of Congress. 
           (a) For purposes of determining the Minnesota apportionment 
        percentage, premiums from reinsurance contracts in connection 
        with property in or liability arising out of activity in, or in 
        connection with the lives or health of Minnesota residents shall 
        be assigned to Minnesota and premiums from reinsurance contracts 
        in connection with property in or liability arising out of 
        activity in, or in connection with the lives or health of 
        non-Minnesota residents shall be assigned outside of Minnesota. 
        Reinsurance premiums are presumed to be received for a Minnesota 
        risk and are assigned to Minnesota, if:  
           (1) the reinsurance contract is assumed for a company 
        domiciled in Minnesota; and 
           (2) the taxpayer, upon request of the commissioner, fails 
        to provide reliable records indicating the reinsured contract 
        covered non-Minnesota risks. 
        For purposes of this paragraph, "Minnesota risk" means coverage 
        in connection with property in or liability arising out of 
        activity in Minnesota, or in connection with the lives or health 
        of Minnesota residents. 
           (b) The apportionment method prescribed by paragraph (a) 
        shall be presumed to fairly and correctly determine the 
        taxpayer's taxable net income.  If the method prescribed in 
        paragraph (a) does not fairly reflect all or any part of taxable 
        net income, the taxpayer may petition for or the commissioner 
        may require the determination of taxable net income by use of 
        another method if that method fairly reflects taxable net 
        income.  A petition within the meaning of this section must be 
        filed by the taxpayer on such form as the commissioner shall 
        require. 
           Sec. 5.  Laws 1995, chapter 264, article 10, section 15, is 
        amended to read: 
           Sec. 15.  [EFFECTIVE DATE.] 
           Section 1 is effective for returns due after December 31, 
        1995.  Section 2 as it relates to quarterly withholding deposits 
        is effective for withholding done after December 31, 1995, and 
        the remainder of section 2 is effective for payments due after 
        December 31, 1995.  Sections 3 and 5 are effective for federal 
        determinations after December 31, 1995.  Section 4 is effective 
        for estates of decedents dying after the date of final 
        enactment.  Section 6 is effective for deaths after December 31, 
        1995, and trusts that become irrevocable after December 31, 
        1995, or are first administered in Minnesota after December 31, 
        1995.  Sections 7 and 9 to 11 are effective for tax years 
        beginning after December 31, 1995.  Section 12 is effective for 
        wages paid after December 31, 1995.  Sections 8 and 13 are 
        effective for tax years beginning after December 31, 1994. 
           Sec. 6.  [INTEREST ON 1996 PENALTIES.] 
           Notwithstanding any law to the contrary, for calendar year 
        1996 individual income tax returns, the late payment penalty 
        under Minnesota Statutes, section 289A.60, subdivision 1, and 
        interest under Minnesota Statutes, section 289A.55, subdivisions 
        2, 4, and 9, will start on May 30, 1997 instead of April 15, 
        1997. 
           Sec. 7.  [EFFECTIVE DATES.] 
           Section 1 is effective for tax years beginning after 
        December 31, 1997. 
           Sections 2 to 4 are effective for tax years beginning after 
        December 31, 1996. 
           Section 5 is effective for trusts first administered in 
        Minnesota after December 31, 1995, and tax years beginning after 
        December 31, 1996. 
                                   ARTICLE 3
                            SALES AND SPECIAL TAXES 
           Section 1.  Minnesota Statutes 1996, section 289A.40, 
        subdivision 2, is amended to read: 
           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.  A claim relating to an 
        overpayment of taxes under chapter 297A must be filed within 
        3-1/2 years from the date prescribed for filing the return, plus 
        any extensions granted for filing the return, but only if filed 
        within the extended time, or within one year from the date the 
        taxpayer's federal income tax return is timely filed claiming 
        the bad debt deduction, whichever period expires later.  The 
        refund or credit is limited to the amount of overpayment 
        attributable to the loss. 
           Sec. 2.  Minnesota Statutes 1996, section 289A.60, 
        subdivision 15, is amended to read: 
           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 75 
        percent payment by a certain date, 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) 70 percent of 
        the actual June liability, (2) 75 percent of the preceding May's 
        liability, or (3) 75 percent of the average monthly liability 
        for the previous calendar year. 
           Sec. 3.  Minnesota Statutes 1996, section 297A.01, is 
        amended by adding a subdivision to read: 
           Subd. 22.  [LEASING.] "Leasing" includes all transfers of 
        possession of tangible personal property or the use thereof by 
        the lessee for a consideration when title remains with the 
        lessor at the end of the lease.  If a contract designated as a 
        lease binds the lessee for a fixed term and the lessee is to 
        obtain title at the end of the term of the agreement or has the 
        option at that time to purchase the property for a nominal 
        amount, the contract is regarded as a sale and not as a lease.  
        For purposes of this chapter, a lease of tangible personal 
        property is a series of transactions that impose upon the lessee 
        multiple payment obligations.  A taxable transaction is 
        considered to have occurred when an obligation to make a lease 
        payment becomes due under the terms of the agreement or trade 
        practices of the lessor.  For purposes of this subdivision, 
        "nominal amount" means an amount so small, slight, or negligible 
        that it is not economically significant and bears no relation to 
        the real value of the item being purchased. 
           Sec. 4.  Minnesota Statutes 1996, section 297A.041, is 
        amended to read: 
           297A.041 [OPERATOR OF FLEA MARKETS; SELLER'S PERMITS 
        REQUIRED.] 
           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 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 that 
        would not qualify as an isolated or occasional sale under 
        section 297A.25, subdivision 12.  
           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 
        that is:  (1) held in conjunction with a community sponsored 
        festival 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. 5.  Minnesota Statutes 1996, section 297A.24, is 
        amended by adding a subdivision to read: 
           Subd. 3.  [LOCAL TAXES.] If an item has been subjected to a 
        sales tax imposed by a political subdivision of this state and 
        is used, stored, or consumed in another political subdivision 
        imposing a local use tax, a credit shall be given for all 
        legally imposed sales taxes paid by the purchaser with respect 
        to that item. 
           Sec. 6.  Minnesota Statutes 1996, section 297A.25, 
        subdivision 12, is amended to read: 
           Subd. 12.  [OCCASIONAL SALES.] (a) The gross receipts from 
        the isolated or occasional sale of tangible personal property in 
        Minnesota not made in the normal course of business of selling 
        that kind of property, and the storage, use, or consumption of 
        property acquired as a result of such a sale are exempt.  
           (b) This exemption does not apply to sales of tangible 
        personal property primarily used in a trade or business unless 
        (1) the sale occurs in a transaction subject to or described in 
        section 118, 331, 332, 336, 337, 338, 351, 355, 368, 721, 731, 
        1031, or 1033 of the Internal Revenue Code of 1986, as amended 
        through December 31, 1990; (2) the sale is between members of a 
        controlled group as defined in section 1563(a) of the Internal 
        Revenue Code of 1986, as amended through December 31, 1990; (3) 
        the sale is a sale of farm machinery; (4) the sale is a farm 
        auction sale; (5) the sale is a sale of substantially all of the 
        assets of a trade or business; or (6) the total amount of gross 
        receipts from the sale of trade or business property made during 
        the calendar month of the sale and the preceding 11 calendar 
        months does not exceed $1,000. 
           (c) For purposes of this subdivision, the following terms 
        have the meanings given.  
           (1) A "farm auction" is a public auction conducted by a 
        licensed auctioneer if substantially all of the property sold 
        consists of property used in the trade or business of farming 
        and property not used primarily in a trade or business. 
           (2) "Trade or business" includes the assets of a separate 
        division, branch, or identifiable segment of a trade or business 
        if, before the sale, the income and expenses attributable to the 
        separate division, branch, or identifiable segment could be 
        separately ascertained from the books of account or record (the 
        lease or rental of an identifiable segment does not qualify for 
        the exemption). 
           (3) A "sale of substantially all of the assets of a trade 
        or business" must occur as a single transaction or a series of 
        related transactions occurring within the 12-month period 
        beginning on the date of the first sale of assets intended to 
        qualify for the exemption provided in paragraph (b), clause (5). 
           For purposes of this subdivision, "normal course of 
        business" means activities that demonstrate a commercial 
        continuity or consistency of making sales or performing services 
        for the purposes of attaining profit or producing income.  
        Factors that indicate that a person is acting in the normal 
        course of business include: 
           (1) systematic solicitation of sales through advertising 
        media; 
           (2) entering into contracts to perform services or provide 
        tangible personal property; 
           (3) maintaining a place of business; or 
           (4) use of exemption certificates to purchase goods exempt 
        from the sales tax. 
           Sec. 7.  Minnesota Statutes 1996, section 297A.25, 
        subdivision 41, is amended to read: 
           Subd. 41.  [BULLET-PROOF VESTS.] The gross receipts from 
        the sale of bullet-resistant soft body armor that is flexible, 
        concealable, and custom-fitted to provide provides the wearer 
        with ballistic and trauma protection are exempt if purchased by 
        a law enforcement agency of the state or a political subdivision 
        of the state, or a licensed peace officer, as defined in section 
        626.84, subdivision 1.  The bullet-resistant soft body armor 
        must meet or exceed the requirements of standard 0101.01 of the 
        National Institute of Law Enforcement and Criminal Justice in 
        effect on December 30, 1986, or meet or exceed the requirements 
        of the standard except wet armor conditioning. 
           Sec. 8.  Minnesota Statutes 1996, section 297A.45, 
        subdivision 4, is amended to read: 
           Subd. 4.  [CITY LOCAL SALES TAX MAY NOT BE IMPOSED.] 
        Notwithstanding any other law or charter provision to the 
        contrary, a home rule charter or statutory city political 
        subdivision that imposes a general sales tax may shall not 
        impose the sales tax on solid waste management services that are 
        subject to the tax under this section.  
           Sec. 9.  [EFFECTIVE DATE.] 
           Section 1 is effective for refund claims filed for bad 
        debts recognized for federal income tax purposes after June 30, 
        1997. 
           Section 2 is effective for returns filed after January 1, 
        1998. 
           Sections 3 to 5 and 8 are effective July 1, 1997. 
           Sections 6 and 7 are effective for sales and purchases 
        occurring after June 30, 1997. 
                                   ARTICLE 4
                                 MINNESOTACARE 
           Section 1.  Minnesota Statutes 1996, section 295.50, 
        subdivision 3, is amended to read: 
           Subd. 3.  [GROSS REVENUES.] "Gross revenues" are total 
        amounts received in money or otherwise by: 
           (1) a hospital for patient services; 
           (2) a surgical center for patient services; 
           (3) a health care provider, other than a staff model health 
        carrier, for patient services; 
           (4) a wholesale drug distributor for sale or distribution 
        of legend drugs that are delivered:  (i) to a Minnesota resident 
        by a wholesale drug distributor who is a nonresident pharmacy 
        directly, by common carrier, or by mail; or (ii) in Minnesota by 
        the wholesale drug distributor, by common carrier, or by mail, 
        unless the legend drugs are delivered to another wholesale drug 
        distributor who sells legend drugs exclusively at wholesale.  
        Legend drugs do not include nutritional products as defined in 
        Minnesota Rules, part 9505.0325; 
           (5) a staff model health plan company as gross premiums for 
        enrollees, copayments, deductibles, coinsurance, and fees for 
        patient services covered under its contracts with groups and 
        enrollees; and 
           (6) a pharmacy for medical supplies, appliances, and 
        equipment. 
           Sec. 2.  Minnesota Statutes 1996, section 295.50, 
        subdivision 14, is amended to read: 
           Subd. 14.  [WHOLESALE DRUG DISTRIBUTOR.] "Wholesale drug 
        distributor" means a wholesale drug distributor required to be 
        licensed under sections 151.42 to 151.51 or a nonresident 
        pharmacy required to be registered under section 151.19. 
           Sec. 3.  Minnesota Statutes 1996, section 295.52, 
        subdivision 4, is amended to read: 
           Subd. 4.  [USE TAX; PRESCRIPTION DRUGS.] A person that 
        receives prescription drugs for resale or use in Minnesota, 
        other than from a wholesale drug distributor that paid the tax 
        under subdivision 3, is subject to a tax equal to two percent of 
        the price paid.  Liability for the tax is incurred when 
        prescription drugs are received or delivered in Minnesota by the 
        person. 
           Sec. 4.  Minnesota Statutes 1996, section 295.53, 
        subdivision 4, is amended to read: 
           Subd. 4.  [DEDUCTION FOR RESEARCH.] (a) In addition to the 
        exemptions allowed under subdivision 1, a hospital or health 
        care provider which is exempt under section 501(c)(3) of the 
        Internal Revenue Code of 1986 or is owned and operated under 
        authority of a governmental unit, may deduct from its gross 
        revenues subject to the hospital or health care provider taxes 
        under sections 295.50 to 295.57 revenues equal to expenditures 
        for qualifying research conducted by an allowable research 
        programs program.  
           (b) For purposes of this subdivision, the following 
        requirements apply: 
           (1) expenditures for allowable research programs are the 
        direct and general must be for program costs for activities 
        which are part of qualifying research conducted by an allowable 
        research program; 
           (2) an allowable research program must be a formal program 
        of medical and health care research approved by the governing 
        body of the hospital or health care provider which also includes 
        active solicitation of research funds from government and 
        private sources.  Allowable conducted by an entity which is 
        exempt under section 501(c)(3) of the Internal Revenue Code of 
        1986 or is owned and operated under authority of a governmental 
        unit; 
           (3) qualifying research must:  
           (A) be approved in writing by the governing body of the 
        hospital or health care provider which is taking the deduction 
        under this subdivision; 
           (1) (B) have as its purpose the development of new 
        knowledge in basic or applied science relating to the diagnosis 
        and treatment of conditions affecting the human body; 
           (2) (C) be subject to review by individuals with expertise 
        in the subject matter of the proposed study but who have no 
        financial interest in the proposed study and are not involved in 
        the conduct of the proposed study; and 
           (3) (D) be subject to review and supervision by an 
        institutional review board operating in conformity with federal 
        regulations if the research involves human subjects or an 
        institutional animal care and use committee operating in 
        conformity with federal regulations if the research involves 
        animal subjects.  Research expenses are not exempt if the study 
        is a routine evaluation of health care methods or products used 
        in a particular setting conducted for the purpose of making a 
        management decision.  Costs of clinical research activities paid 
        directly for the benefit of an individual patient are excluded 
        from this exemption.  Basic research in fields including 
        biochemistry, molecular biology, and physiology are also 
        included if such programs are subject to a peer review process. 
           (c) No deduction shall be allowed under this subdivision 
        for any revenue received by the hospital or health care provider 
        in the form of a grant, gift, or otherwise, whether from a 
        government or nongovernment source, on which the tax liability 
        under section 295.52 is not imposed or for which the tax 
        liability under section 295.52 has been received from a third 
        party as provided for in section 295.582. 
           (d) Effective beginning with calendar year 1995, the 
        taxpayer shall not take the deduction under this section into 
        account in determining estimated tax payments or the payment 
        made with the annual return under section 295.55.  The total 
        deduction allowable to all taxpayers under this section for 
        calendar years beginning after December 31, 1994, may not exceed 
        $65,000,000.  To implement this limit, each qualifying hospital 
        and qualifying health care provider shall submit to the 
        commissioner by March 15 its total expenditures qualifying for 
        the deduction under this section for the previous calendar 
        year.  The commissioner shall sum the total expenditures of all 
        taxpayers qualifying under this section for the calendar year.  
        If the resulting amount exceeds $65,000,000, the commissioner 
        shall allocate a part of the $65,000,000 deduction limit to each 
        qualifying hospital and health care provider in proportion to 
        its share of the total deductions.  The commissioner shall pay a 
        refund to each qualifying hospital or provider equal to its 
        share of the deduction limit multiplied by two percent.  The 
        commissioner shall pay the refund no later than May 15 of the 
        calendar year. 
           Sec. 5.  Minnesota Statutes 1996, section 295.55, 
        subdivision 2, is amended to read: 
           Subd. 2.  [ESTIMATED TAX; HOSPITALS; SURGICAL CENTERS.] (a) 
        Each hospital or surgical center must make estimated payments of 
        the taxes for the calendar year in monthly installments to the 
        commissioner within ten 15 days after the end of the month. 
           (b) Estimated tax payments are not required of hospitals or 
        surgical centers if the tax for the calendar year is less than 
        $500 or if a hospital has been allowed a grant under section 
        144.1484, subdivision 2, for the year. 
           (c) Underpayment of estimated installments bear interest at 
        the rate specified in section 270.75, from the due date of the 
        payment until paid or until the due date of the annual return at 
        the rate specified in section 270.75.  An underpayment of an 
        estimated installment is the difference between the amount paid 
        and the lesser of (1) 90 percent of one-twelfth of the tax for 
        the calendar year or (2) the tax for the actual gross revenues 
        received during the month. 
           Sec. 6.  [EFFECTIVE DATE.] 
           Sections 1, 2, and 3 are effective for gross revenues 
        received on or after July 1, 1997.  Section 4 is effective for 
        research expenditures incurred on or after January 1, 1997.  
        Section 5 is effective for estimated payments due after July 1, 
        1997.  
                                   ARTICLE 5
                                  COLLECTIONS
           Section 1.  Minnesota Statutes 1996, section 270.063, is 
        amended to read: 
           270.063 [COLLECTION OF DELINQUENT TAXES; COSTS.] 
           Subdivision 1.  [APPROPRIATION.] For the purpose of 
        collecting delinquent state tax liabilities, there is 
        appropriated to the commissioner of revenue an amount 
        representing the cost of collection by contract with collection 
        agencies, revenue departments of other states, or attorneys to 
        enable the commissioner to reimburse these agencies, 
        departments, or attorneys for this service.  The commissioner 
        shall report quarterly on the status of this program to the 
        chair of the house tax and appropriation committees and senate 
        tax and finance committees.  
           Subd. 2.  [PREPAYMENT.] Notwithstanding section 16A.15, 
        subdivision 3, the commissioner of revenue may authorize the 
        prepayment of sheriff's fees, attorney fees, fees charged by 
        revenue departments of other states, or court costs to be 
        incurred in connection with the collection of delinquent tax 
        liabilities owed to the commissioner of revenue. 
           Subd. 3.  [COLLECTION OF FINANCIAL INSTITUTION FEES.] The 
        commissioner shall collect from a taxpayer any collection fees 
        or costs charged by financial institutions and incurred by the 
        commissioner. 
           Sec. 2.  Minnesota Statutes 1996, section 270.101, 
        subdivision 3, is amended to read: 
           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, or within one year after the date 
        of an order assessing underlying tax, whichever period expires 
        later.  An order assessing personal liability under this section 
        is reviewable under section 289A.65 and is appealable to tax 
        court. 
           If a person has been assessed under this section for an 
        amount for a given period and the time for appeal has expired or 
        there has been a final determination that the person is liable, 
        collection action is not stayed pursuant to section 270.10, 
        subdivision 5, for subsequent assessments of additional amounts 
        for the same person for the same period and tax type. 
           Sec. 3.  Minnesota Statutes 1996, 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 at 
        any time a lien filed under section 270.69 is enforceable, or, 
        if the action is to renew or enforce 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 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 of it, the 
        taxpayer shall serve an answer 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 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.  If a 
        proceeding is referred to a county attorney, and the county 
        attorney fails to issue or cause to be issued an indictment or 
        criminal complaint within 30 days after the referral by the 
        commissioner, the attorney general may conduct the proceeding.  
        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.  
           In addition to the procedure in this subdivision, legal 
        action may be commenced by the commissioner in district court in 
        the same manner or venue as any other civil action. 
           Sec. 4.  Minnesota Statutes 1996, section 270.701, 
        subdivision 2, is amended to read: 
           Subd. 2.  [NOTICE OF SALE.] The commissioner shall as soon 
        as practicable after the seizure of the property give notice of 
        sale of the property to the owner, in the manner of service 
        prescribed in subdivision 1.  In the case of personal property, 
        the notice shall be served at least 10 days prior to the sale. 
        In the case of real property, the notice shall be served at 
        least four weeks prior to the sale.  The commissioner shall also 
        cause public notice of each sale to be made.  In the case of 
        personal property, notice shall be posted at least 10 days prior 
        to the sale at the post office nearest the place county 
        courthouse for the county where the seizure is made, and in not 
        less than two other public places. In the case of real property, 
        six weeks' published notice shall be given prior to the sale, in 
        a newspaper published or generally circulated in the county.  
        The notice of sale provided in this subdivision shall specify 
        the property to be sold, and the time, place, manner and 
        conditions of the sale.  Whenever levy is made without regard to 
        the ten-day period provided in section 270.70, subdivision 2, 
        public notice of sale of the property seized shall not be made 
        within the ten-day period unless section 270.702 (relating to 
        sale of perishable goods) is applicable.  
           Sec. 5.  Minnesota Statutes 1996, section 270.701, 
        subdivision 5, is amended to read: 
           Subd. 5.  [MANNER AND CONDITIONS OF SALE.] (a) Before the 
        sale the commissioner shall determine a minimum price for which 
        the property shall be sold, and if no person offers for the 
        property at the sale the amount of the minimum price, the 
        property shall be declared to be purchased at the minimum price 
        for the state of Minnesota; otherwise the property shall be 
        declared to be sold to the highest bidder.  In determining the 
        minimum price, the commissioner shall take into account the 
        expense of making the levy and sale.  The announcement of the 
        minimum price determined by the commissioner may be delayed 
        until the receipt of the highest bid.  
           (b) The sale shall not be conducted in any manner other 
        than:  
           (i) by public auction, or 
           (ii) by public sale under sealed bids., or 
           (iii) in the case of items which individually or in usually 
        marketable units have a value of $50 or less, by public or 
        private proceedings as a unit or in parcels at any time and 
        place and on any terms, but every aspect of the disposition 
        including the method, manner, time, place, and terms must be 
        commercially reasonable.  
           (c) In the case of seizure of several items of property, 
        the items may be offered separately, in groups, or in the 
        aggregate, and shall be sold under whichever method produces the 
        highest aggregate amount, except that sales under paragraph (b), 
        item (iii), must produce a reasonable amount under the 
        circumstances.  
           (d) Payment in full shall be required at the time of 
        acceptance of a bid, except that a part of the payment may be 
        deferred by the commissioner for a period not to exceed 30 days. 
           (e) Other methods (including advertising) in addition to 
        those prescribed in subdivision 2 may be used in giving notice 
        of the sale.  
           (f) The commissioner may adjourn the sale from time to time 
        for a period not to exceed 30 days.  
           (g) If payment in full is required at the time of 
        acceptance of a bid and is not then and there paid, the 
        commissioner shall forthwith proceed to again sell the property 
        in the manner provided in this section.  If the conditions of 
        the sale permit part of the payment to be deferred, and if the 
        part is not paid within the prescribed period, suit may be 
        instituted against the purchaser for the purchase price or that 
        part thereof as has not been paid, together with interest at the 
        rate specified in section 549.09 from the date of the sale; or, 
        in the discretion of the commissioner, the sale may be declared 
        by the commissioner to be null and void for failure to make full 
        payment of the purchase price and the property may again be 
        advertised and sold as provided in this section.  In the event 
        of a readvertisement and sale, any new purchaser shall receive 
        the property or rights to property free and clear of any claim 
        or right of the former defaulting purchaser, of any nature 
        whatsoever, and the amount paid upon the bid price by the 
        defaulting purchaser shall be forfeited.  
           Sec. 6.  Minnesota Statutes 1996, section 270.708, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [COLLECTION OF LIABILITY.] Any money 
        realized by proceedings under this chapter, whether by seizure, 
        by surrender under section 270.70 (except pursuant to 
        subdivision 9 thereof), by sale of seized property, or by sale 
        of property redeemed by the state of Minnesota (if the interest 
        of the state of Minnesota in the property was a lien arising 
        under the provisions of section 270.69), or by agreement, 
        arrangement, or any other means shall be applied as follows: 
           (a) First, against the expenses of the proceedings; then 
           (b) If the property seized and sold is subject to a tax 
        administered by the commissioner of revenue which has not been 
        paid, the amount remaining after applying clause (a) shall next 
        be applied against the tax liability (and, if the tax was not 
        previously assessed, it shall then be assessed); and 
           (c) The amount, if any, remaining after applying clauses 
        (a) and (b) shall be applied against the tax liability in 
        respect of which the levy was made or the sale was conducted.  
           Sec. 7.  Minnesota Statutes 1996, section 270.721, is 
        amended to read: 
           270.721 [REVOCATION OF CORPORATE CERTIFICATES OF AUTHORITY 
        TO DO BUSINESS IN THIS STATE.] 
           When a foreign corporation authorized to do business in 
        this state under chapter 303, or a foreign limited liability 
        company or partnership authorized to do business in this state 
        under chapter 322B, fails to comply with any tax laws 
        administered by the commissioner of revenue, the commissioner 
        may serve the secretary of state with a certified copy of an 
        order finding such failure to comply.  The secretary of state, 
        upon receipt of the order, shall revoke the certificate of 
        authority of the corporation to do business in this state, and 
        shall reinstate the certificate under section 303.19 or section 
        322B.960, subdivision 6, only when the corporation or limited 
        liability company or partnership has obtained from the 
        commissioner an order finding that the corporation or limited 
        liability company or partnership is in compliance with state tax 
        law.  An order requiring revocation of a certificate shall not 
        be issued unless the commissioner gives the corporation or 
        limited liability company or partnership 30 days' written notice 
        of the proposed order, specifying the violations of state tax 
        law, and affording the corporation an opportunity to request a 
        contested case hearing under chapter 14. 
           Sec. 8.  Minnesota Statutes 1996, 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 pay, withhold, or collect the tax imposed by section 
        290.02, 290.92, or 297A.02, or local sales and use tax payable 
        to the commissioner of revenue, or a local option tax 
        administered and collected by the commissioner of revenue, and 
        who are 30 ten 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 files 
        all returns and paying pays all taxes then due, the commissioner 
        shall notify the commissioner of public safety within two 
        business days that the delinquency was cured. 
           Sec. 9.  Minnesota Statutes 1996, section 289A.36, 
        subdivision 4, is amended to read: 
           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 record keeper, 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 or assets 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. 
           Sec. 10.  Minnesota Statutes 1996, section 297A.07, 
        subdivision 3, is amended to read: 
           Subd. 3.  [NEW PERMITS AFTER REVOCATION.] The commissioner 
        shall not issue a new permit or reinstate a revoked permit after 
        revocation unless the taxpayer applies for a permit and provides 
        reasonable evidence of intention to comply with the sales and 
        use tax laws and rules.  The commissioner may require the 
        applicant to supply security, in addition to that authorized by 
        section 297A.28, as is reasonably necessary to insure compliance 
        with the sales and use tax laws and rules. 
           If a taxpayer has had a permit or permits revoked three 
        times in a five-year period, the commissioner shall not issue a 
        new permit or reinstate the revoked permit until 24 months have 
        elapsed after revocation and the taxpayer has satisfied the 
        conditions for reinstatement of a revoked permit or issuance of 
        a new permit imposed by this section and rules adopted hereunder.
           For purposes of this subdivision, the term "taxpayer" means 
        an individual, if a revoked permit was issued to or in the name 
        of an individual, or a corporation or partnership, if a revoked 
        permit was issued to or in the name of a corporation or 
        partnership.  Taxpayer also means an officer of a corporation, a 
        member of a partnership, or an individual who is liable for 
        delinquent sales taxes, either for the entity for which the new 
        or reinstated permit is at issue, or for another entity for 
        which a permit was previously revoked, or personally as a permit 
        holder. 
           Sec. 11.  [EFFECTIVE DATES.] 
           Section 1 is effective for fees and costs incurred on or 
        after the day following final enactment. 
           Section 2 as it pertains to the period of limitations for 
        orders assessing personal liability is effective for personal 
        liability assessments based on underlying taxes assessed on or 
        after the day following final enactment.  Section 2 as it 
        pertains to the stay of collection action for subsequent 
        assessments is effective for personal liability assessments made 
        on or after the day following final enactment. 
           Section 3 is effective for causes of action arising before 
        the day following final enactment which are not barred by the 
        statute of limitations as of that date, and for causes of action 
        arising thereafter. 
           Section 4 is effective for notices posted on or after the 
        day following final enactment.  
           Section 5 is effective for sales of property seized on or 
        after the day following final enactment.  
           Section 6 is effective for money realized in connection 
        with property seized on or after the day following final 
        enactment. 
           Section 7 is effective for orders issued on or after July 
        1, 1997. 
           Section 8 is effective with respect to lists submitted to 
        the commissioner of public safety on or after July 1, 1997. 
           Section 9 is effective with respect to subpoenas served on 
        or after the day following final enactment. 
           Section 10 is effective for all cases in which the third 
        permit revocation occurs on or after July 1, 1997. 
                                   ARTICLE 6
                                 MISCELLANEOUS 
           Section 1.  Minnesota Statutes 1996, section 8.30, is 
        amended to read: 
           8.30 [COMPROMISE OF TAX CLAIMS.] 
           Notwithstanding any other provisions of law to the 
        contrary, the attorney general shall have authority to 
        compromise taxes, penalties, and interest in any case referred 
        to the attorney general, whether reduced to judgment or not, 
        where, in the attorney general's opinion, it shall be in the 
        best interests of the state to do so.  A compromise made 
        hereunder of a tax debt shall be in such form as the attorney 
        general shall prescribe and shall be in writing signed by the 
        attorney general, the taxpayer or taxpayer's representative, and 
        the commissioner of revenue.  
           Sec. 2.  Minnesota Statutes 1996, section 60A.15, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [DOMESTIC AND FOREIGN COMPANIES.] (a) On or 
        before April 1, June 1, and December 1 of each year, every 
        domestic and foreign company, including town and farmers' mutual 
        insurance companies, domestic mutual insurance companies, marine 
        insurance companies, health maintenance organizations, 
        integrated service networks, community integrated service 
        networks, and nonprofit health service plan corporations, 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 paragraphs (d) and (e), 
        installments must be based on a sum equal to two percent of the 
        premiums described in paragraph (b). 
           (b) Installments under paragraph (a), (d), or (e) 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. 
           (c) 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. 
           (d) For health maintenance organizations, nonprofit health 
        services plan corporations, integrated service networks, and 
        community integrated service networks, the installments must be 
        based on an amount equal to one percent of premiums described in 
        paragraph (b) that are paid after December 31, 1995. 
           (e) For purposes of computing installments for town and 
        farmers' mutual insurance companies and for mutual property 
        casualty companies with total assets on December 31, 1989, of 
        $1,600,000,000 or less, the following rates apply: 
           (1) for all life insurance, two percent; 
           (2) for town and farmers' mutual insurance companies and 
        for mutual property and casualty companies with total assets of 
        $5,000,000 or less, on all other coverages, one percent; and 
           (3) for mutual property and casualty companies with total 
        assets on December 31, 1989, of $1,600,000,000 or less, on all 
        other coverages, 1.26 percent. 
           (f) If the aggregate amount of premium tax payments under 
        this section and the fire marshal tax payments under section 
        299F.21 made during a calendar year is equal to or exceeds 
        $120,000, all tax payments in the subsequent calendar year must 
        be paid by means of a funds transfer as defined in section 
        336.4A-104, paragraph (a).  The funds transfer payment date, as 
        defined in section 336.4A-401, must be on or before the date the 
        payment is due.  If the date the payment is due is not a funds 
        transfer business day, as defined in section 336.4A-105, 
        paragraph (a), clause (4), the payment date must be on or before 
        the funds transfer business day next following the date the 
        payment is due.  
           (g) Premiums under medical assistance, general assistance 
        medical care, the MinnesotaCare program, and the Minnesota 
        comprehensive health insurance plan are not subject to tax under 
        this section. 
           Sec. 3.  Minnesota Statutes 1996, section 270.02, 
        subdivision 3, is amended to read: 
           Subd. 3.  [POWERS, ORGANIZATION, ASSISTANTS.] Subject to 
        the provisions of this chapter and other applicable laws the 
        commissioner shall have power to organize the department with 
        such divisions and other agencies as the commissioner deems 
        necessary and to appoint one deputy commissioner, a department 
        secretary, directors of divisions, and such other officers, 
        employees, and agents as the commissioner may deem necessary to 
        discharge the functions of the department, define the duties of 
        such officers, employees, and agents, and delegate to them any 
        of the commissioner's powers or duties, subject to the 
        commissioner's control and under such conditions as the 
        commissioner may prescribe.  Appointments to exercise delegated 
        power to sign documents which require the signature of the 
        commissioner or a delegate by law shall be by written order 
        filed with the secretary of state. 
           Sec. 4.  Minnesota Statutes 1996, section 270.10, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [IN WRITING; APPROVAL BY ATTORNEY GENERAL.] 
        All orders and decisions of the commissioner of revenue, or any 
        subordinates, respecting any tax, assessment, or other 
        obligation, shall be in writing, filed in the offices of the 
        department.  Any order or decision increasing or decreasing any 
        tax, assessment, or other obligation by a sum exceeding $1,000 
        on real or personal property, or the net tax capacity thereof, 
        or other obligation relating thereto, the result of which is to 
        increase or decrease the total amount payable including 
        penalties and interest, by a sum exceeding $1,000, and any order 
        or decision increasing or decreasing any other tax by a sum 
        exceeding $1,000 exclusive of penalties and interest, must bear 
        the written signature or facsimile signature of the commissioner 
        or the commissioner's delegate.  Written notice of every order 
        granting a reduction, abatement, or refundment exceeding $5,000 
        of any tax exclusive of penalties and interest, shall be given 
        within five days to the attorney general.  The attorney general 
        shall forthwith examine the order, and if proper and legal, 
        approve it in writing.  The attorney general may waive the right 
        of appeal from the order on behalf of the state or may appeal 
        from the order on behalf of the state as herein provided in 
        chapter 271.  Written approval of the commissioner or a delegate 
        and written notice to the attorney general shall not be required 
        with respect to the following orders:  (1) orders reducing net 
        tax capacity of property by reason of its classification as a 
        homestead; (2) orders not involving refunds which have the 
        effect only of correcting income and franchise tax assessments 
        to conform to the amounts shown on final returns filed as 
        provided by section 289A.19, subdivisions 1 and 2; and (3) 
        original orders for the refundment of gasoline and special fuel 
        taxes.  
           Sec. 5.  Minnesota Statutes 1996, section 270.10, 
        subdivision 5, is amended to read: 
           Subd. 5.  [APPEAL; PAYMENT OF ORDER.] Except for orders 
        relating to property tax matters, no collection action may be 
        taken, including the filing of liens under section 270.69, and 
        no late payment penalties may be imposed when a return has been 
        filed for the tax type and period upon which the order is based, 
        if an order of the commissioner, excluding orders relating to 
        property tax matters, is paid: 
           (1) within 60 days after notice and demand for payment of 
        the order have has been mailed to the taxpayer; or 
           (2) if an administrative appeal or a tax court appeal under 
        chapter 271 is timely filed, within 60 days following final 
        determination of the appeal if the appeal is based upon a 
        constitutional challenge to the tax, and if not, when the 
        decision of the tax court is made. 
           Sec. 6.  Minnesota Statutes 1996, section 270.101, 
        subdivision 2, is amended to read: 
           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.  "Person" does not include an unpaid, 
        volunteer member of a board of trustees or directors of an 
        organization exempt from taxation under section 290.05, if the 
        member is solely serving in an honorary capacity, does not 
        participate in the day-to-day or financial operations of the 
        organization, and has no actual knowledge of the failure to file 
        returns or remit taxes. 
           Sec. 7.  Minnesota Statutes 1996, section 270.101, is 
        amended by adding a subdivision to read: 
           Subd. 4.  [RIGHT OF CONTRIBUTION.] A person who has paid 
        all or part of a liability assessed under this section has a 
        cause of action against other liable persons to recover the 
        amount paid in excess of that person's share of the liability.  
        A claim for recovery of contribution may be made only in a 
        proceeding which is separate from, and cannot be joined or 
        consolidated with, an administrative or judicial proceeding or 
        investigation involving the commissioner's administration or 
        enforcement of this section.  An order assessing liability under 
        this section against the person from whom contribution is being 
        sought is not a prerequisite for bringing an action for recovery 
        of contribution, nor is the issuance of an order binding on the 
        court in which the proceeding is brought.  The court can 
        determine whether each person would be liable under this section 
        and the share of liability.  The commissioner cannot be made a 
        party to any proceeding for recovery of contribution, nor is a 
        determination in such a proceeding binding on the commissioner 
        for the purpose of administering or enforcing this section.  An 
        action for contribution arises when the liability under this 
        section is paid in full, or the liability of the person seeking 
        contribution has been determined by agreement between the 
        commissioner and such person and paid, and must be brought 
        within the time period prescribed in section 541.05. 
           Sec. 8.  Minnesota Statutes 1996, section 270.271, is 
        amended by adding a subdivision to read: 
           Subd. 5.  [PRIVATE DELIVERY SERVICES.] A reference in this 
        section to the United States mail shall be treated as including 
        a reference to any designated delivery service, and any 
        reference in this section to a postmark by the United States 
        Postal Service shall be treated as including a reference to any 
        date recorded or marked by any designated delivery service in 
        accordance with section 7502(f) of the Internal Revenue Code. 
           Sec. 9.  Minnesota Statutes 1996, section 270.273, 
        subdivision 2, is amended to read: 
           Subd. 2.  [TERMS OF A TAXPAYER ASSISTANCE ORDER.] A 
        taxpayer assistance order may require the department within a 
        specified time period to release property of the taxpayer levied 
        on, cease any action, take any action as permitted by law, or 
        refrain from taking any action to enforce the state tax laws 
        against the taxpayer, until the issue or issues giving rise to 
        the order have been resolved. 
           Sec. 10.  Minnesota Statutes 1996, section 270.276, 
        subdivision 2, is amended to read: 
           Subd. 2.  [DAMAGES.] On a finding of liability on the part 
        of the defendant in an action brought under subdivision 1, the 
        defendant is liable to the plaintiff in an amount equal to the 
        lesser of $100,000 $200,000, or the sum of (1) actual, direct 
        economic damages sustained by the plaintiff as a proximate 
        result of the reckless or intentional actions of the employee 
        and (2) the costs of the action.  Damages must be paid in 
        accordance with section 3.736, subdivision 7. 
           Sec. 11.  Minnesota Statutes 1996, 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, the 
        commissioner may extend the time for payment for a further 
        period.  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 may 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 
        agreement shall provide that it can be terminated, after notice 
        by the commissioner, if information provided by the taxpayer 
        prior to the agreement was inaccurate or incomplete, collection 
        of the tax covered by the agreement is in jeopardy, there is a 
        subsequent change in the taxpayer's financial condition, the 
        taxpayer has failed to make a payment due under the agreement, 
        or has failed to pay any other tax or file a tax return coming 
        due after the agreement.  The notice must be given at least 14 
        calendar days prior to termination, and shall advise the 
        taxpayer of the right to request a reconsideration from the 
        commissioner of whether termination is reasonable and 
        appropriate under the circumstances.  A request for 
        reconsideration does not stay collection action beyond the 
        14-day notice period.  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. 12.  Minnesota Statutes 1996, section 270.69, 
        subdivision 11, is amended to read: 
           Subd. 11.  [ERRONEOUS LIENS.] After the filing of a notice 
        of lien under this section on the property or rights to property 
        of a person, the person may appeal to the commissioner, in the 
        form and at the time prescribed by the commissioner, alleging an 
        error in the filing of the lien and requesting its release.  If 
        the commissioner determines that the filing of the notice of any 
        lien was erroneous, within 14 days after the determination, the 
        commissioner must issue a certificate of release of the lien.  
        The certificate must include a statement that the filing of the 
        lien was erroneous.  In the event that the lien is erroneous and 
        is not released within the 14-day period, reasonable attorney 
        fees shall be paid.  Damages must be paid in accordance with 
        section 3.736, subdivision 7.  Even if a lien is not erroneous, 
        the commissioner may withdraw the lien if the filing of the lien 
        was premature or not in accordance with administrative 
        procedures of the commissioner, or withdrawal of the lien will 
        facilitate the collection of the tax liability. 
           Sec. 13.  [270.771] [PAYMENTS REQUIRED TO BE MADE BY 
        ELECTRONIC FUNDS TRANSFER.] 
           (a) If a taxpayer is required to make payment of a tax to 
        the commissioner by means of electronic funds transfer as 
        defined in section 336.4A-104, paragraph (a), the taxpayer shall 
        make all payments of all taxes and fees paid to the commissioner 
        by means of electronic funds transfer. 
           (b) Paragraph (a) does not apply to payments required to be 
        made for individual income taxes under section 289A.20, 
        subdivision 1, paragraph (a), or 289A.25.  
           Sec. 14.  Minnesota Statutes 1996, section 271.06, 
        subdivision 2, is amended to read: 
           Subd. 2.  [TIME; NOTICE; INTERVENTION.] Except as otherwise 
        provided by law, within 60 days after notice of the making and 
        filing of an order of the commissioner of revenue, the 
        appellant, or the appellant's attorney, shall serve a notice of 
        appeal upon the commissioner and file the original, with proof 
        of such service, with the tax court administrator or with the 
        court administrator of district court acting as court 
        administrator of the tax court; provided, that the tax court, 
        for cause shown, may by written order extend the time for 
        appealing for an additional period not exceeding 30 days.  The 
        notice of appeal shall be in the form prescribed by the tax 
        court.  Within five days after receipt, the commissioner shall 
        transmit a copy of the notice of appeal to the attorney general 
        in all cases where the amount at issue exceeds $100.  The 
        attorney general shall represent the commissioner, if requested, 
        upon all such appeals except in cases where the attorney general 
        has appealed in behalf of the state, or in other cases where the 
        attorney general deems it against the interests of the state to 
        represent the commissioner, in which event the attorney general 
        may intervene or be substituted as an appellant in behalf of the 
        state at any stage of the proceedings. 
           Upon a final determination of any other matter over which 
        the court is granted jurisdiction under section 271.01, 
        subdivision 5, the taxpayer or the taxpayer's attorney shall 
        file a petition or notice of appeal as provided by law with the 
        court administrator of district court, acting in the capacity of 
        court administrator of the tax court, with proof of service of 
        the petition or notice of appeal as required by law and within 
        the time required by law.  As used in this subdivision, "final 
        determination" includes a notice of assessment and equalization 
        for the year in question received from the local assessor, an 
        order of the local board of equalization, or an order of a 
        county board of equalization. 
           The tax court shall prescribe a filing system so that the 
        notice of appeal or petition filed with the district court 
        administrator acting as court administrator of the tax court is 
        forwarded to the tax court administrator.  In the case of an 
        appeal or a petition concerning property valuation for which the 
        assessor, a local board of equalization, a county board of 
        equalization or the commissioner of revenue has issued an order, 
        the officer issuing the order shall be notified of the filing of 
        the appeal.  The notice of appeal or petition shall be in the 
        form prescribed by the tax court. 
           Sec. 15.  Minnesota Statutes 1996, section 271.08, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [WRITTEN ORDER.] The tax court, except in 
        small claims division, shall determine every appeal by written 
        order containing findings of fact and the decision of the tax 
        court.  A memorandum of the grounds of the decision shall be 
        appended.  A certified copy of the order shall be transmitted to 
        the commissioner of revenue or the appropriate unit of 
        government and filed in that office.  Notice of the entry of the 
        order and of the substance of the decision shall be given by 
        mail mailed to all other parties who have appeared, and also, in 
        all cases where the amount at issue exceeds $100, to the 
        attorney general.  A motion for rehearing, which includes a 
        motion for amended findings of fact, conclusions of law, or a 
        new trial, must be served by the moving party within 15 days 
        after mailing of the notice by the court as specified in this 
        subdivision, and the motion must be heard within 30 days 
        thereafter, unless the time for hearing is extended by the court 
        within the 30-day period for good cause shown. 
           Sec. 16.  Minnesota Statutes 1996, section 271.10, 
        subdivision 2, is amended to read: 
           Subd. 2.  [SERVICE OF WRIT.] Within 60 days after notice of 
        the making and filing of the order of the tax court, or the 
        making and filing of an order on a petition motion for 
        rehearing, which includes a motion for amended findings of fact, 
        conclusions of law, or a new trial, the petitioner for review 
        shall obtain from the supreme court a writ of certiorari, and 
        shall serve the same upon all other parties appearing in the 
        proceedings before the tax court, and shall file the original, 
        with proof of such service, with the court administrator of the 
        tax court.  Every petitioner, except the attorney general, the 
        commissioner of revenue, the state and its political 
        subdivisions, shall also pay to the court administrator the fee 
        prescribed by rule 103.01 of the rules of civil appellate 
        procedure which shall be disposed of in the manner provided by 
        that rule, and file a bond or make a deposit in like manner and 
        amount as in case of an appeal from the district court.  The fee 
        shall be disposed of as in such case.  Return upon the writ 
        shall be made to the supreme court and the matter shall be heard 
        and determined by the court as in other certiorari cases, 
        subject to the provisions hereof and to such rules as the court 
        may prescribe for cases arising hereunder. 
           Sec. 17.  [287.13] [VIOLATIONS; PENALTIES.] 
           Subdivision 1.  [FAILURE TO PAY FULL AMOUNT.] Any person 
        liable for the tax imposed by section 287.05 who fails to pay 
        the full amount of tax imposed under sections 287.01 to 287.12, 
        unless such failure is shown to be due to reasonable cause, is 
        liable for a civil penalty of $250 for each such failure. 
           Subd. 2.  [ADDITIONAL PENALTY.] Any person who willfully 
        attempts to evade or defeat the tax imposed under sections 
        287.01 to 287.12, or the payment thereof, shall, in addition to 
        the penalty provided in subdivision 1, be liable for a penalty 
        of 50 percent of the total amount of the underpayment of the tax.
           Sec. 18.  Minnesota Statutes 1996, section 287.31, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [FAILURE TO COMPLY.] Any person liable for 
        the tax imposed by section 287.21 who fails to comply with the 
        provisions of section 287.25 relating to the attachment or 
        cancellation of documentary stamps, unless such failure is shown 
        to be due to reasonable cause, shall be liable to a civil 
        penalty of $50 $250 for each such failure. 
           Sec. 19.  Minnesota Statutes 1996, section 289A.09, 
        subdivision 2, is amended to read: 
           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 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 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, paragraph (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; 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 and the 
        regulations issued under it. 
           (f) A "provider of payroll services" as defined in section 
        289A.20, subdivision 2, paragraph (f), must submit the returns 
        required by this subdivision and subdivision 1, paragraph (a), 
        with the commissioner by electronic means. 
           Sec. 20.  Minnesota Statutes 1996, section 289A.20, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [INDIVIDUAL INCOME, FIDUCIARY INCOME, 
        MINING COMPANY, CORPORATE FRANCHISE, AND ENTERTAINMENT TAXES.] 
        (a) Individual income, fiduciary, mining company, 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. 
           (c) If a fiduciary administers 100 or more trusts, 
        fiduciary income taxes for all trusts administered by the 
        fiduciary must be paid by funds transfer as defined in section 
        336.4A-104, paragraph (a).  The funds transfer payment date, as 
        defined in section 336.4A-401, must be on or before the date the 
        tax payment is due.  If the date the payment is due is not a 
        funds transfer business day, as defined in section 336.4A-105, 
        paragraph (a), clause (4), the payment date must be on or before 
        the funds transfer business day next following the date the 
        payment is due. 
           Sec. 21.  Minnesota Statutes 1996, section 289A.20, 
        subdivision 2, is amended to read: 
           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) An employer who, during the previous quarter, withheld 
        more than $1,500 of tax under section 290.92, subdivision 2a or 
        3, or 290.923, subdivision 2, must deposit tax withheld under 
        those sections with the commissioner within the time allowed to 
        deposit the employer's federal withheld employment taxes under 
        Treasury Regulation, section 31.6302-1, without regard to the 
        safe harbor or de minimus rules in subparagraph (f) or the 
        one-day rule in subsection (c), clause (3).  Taxpayers must 
        submit a copy of their federal notice of deposit status to the 
        commissioner upon request by the commissioner. 
           (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. 
           (e) If the aggregate amount of the tax withheld during a 
        fiscal year ending June 30 under section 290.92, subdivision 2a 
        or 3, is equal to or exceeds $50,000 the amounts established for 
        remitting federal withheld taxes pursuant to the regulations 
        promulgated under section 6302(h) of the Internal Revenue Code, 
        the employer must remit each required deposit in the subsequent 
        calendar year by means of a funds transfer as defined in section 
        336.4A-104, paragraph (a).  The funds transfer payment date, as 
        defined in section 336.4A-401, must be on or before the date the 
        deposit is due.  If the date the deposit is due is not a funds 
        transfer business day, as defined in section 336.4A-105, 
        paragraph (a), clause (4), the payment date must be on or before 
        the funds transfer business day next following the date the 
        deposit is due. 
           (f) Providers of payroll services who remit withholding 
        deposits on behalf of 50 or more employers, or on behalf of any 
        employer with aggregate amounts over the threshold in paragraph 
        (e), must remit all deposits by means of a funds transfer as 
        provided in paragraph (e), regardless of the aggregate amount of 
        tax withheld during a fiscal year for all of the employers.  For 
        the purposes of this paragraph, "providers of payroll services" 
        means persons who have custody of or control over another 
        employer's funds for the purpose of paying on behalf of the 
        other employer's Minnesota withholding taxes. 
           Sec. 22.  Minnesota Statutes 1996, section 289A.31, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [INDIVIDUAL INCOME, FIDUCIARY INCOME, 
        MINING COMPANY, CORPORATE FRANCHISE, AND ENTERTAINMENT TAXES.] 
        (a) Individual income, fiduciary income, mining company, 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. 
           (c) The tax imposed under section 290.0922 on partnerships 
        is the joint and several liability of the partnership and the 
        general partners. 
           Sec. 23.  Minnesota Statutes 1996, section 289A.37, 
        subdivision 1, is amended to read: 
           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.  When no 
        return has been filed, the commissioner may make a return for 
        the taxpayer under section 289A.35 or may send an order of 
        assessment under this subdivision.  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) No collection action can be taken, including the filing 
        of liens under section 270.69, and the penalty under section 
        289A.60, subdivision 1, is not imposed and no collection action 
        can be taken, including the filing of liens under section 270.69 
        when a return has been filed for the tax type and period upon 
        which the order is based, if the amount shown on the order is 
        paid to the commissioner:  (1) within 60 days after notice of 
        the amount and demand for its payment have the order has been 
        mailed to the taxpayer by the commissioner; or (2) if an 
        administrative appeal is filed under section 289A.65 or a tax 
        court appeal is filed under chapter 271, within 60 days 
        following final determination of the appeal if the appeal is 
        based upon a constitutional challenge to the tax, and if not, 
        when the decision of the tax court is made. 
           Sec. 24.  Minnesota Statutes 1996, section 289A.40, 
        subdivision 1, is amended to read: 
           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 one year from the date of an order assessing 
        tax under section 289A.37, subdivision 1, or one year from the 
        date of a return made by the commissioner under section 289A.35, 
        upon payment in full of the tax, penalties, and interest shown 
        on the order or return made by the commissioner, whichever 
        period expires later.  Claims for refund, except for taxes under 
        chapter 297A, filed after the 3-1/2 year period but within the 
        one-year period are limited to the amount of the tax, penalties, 
        and interest on the order or return made by the commissioner and 
        to issues determined by the order or return made by the 
        commissioner. 
           In the case of assessments under section 289A.38, 
        subdivision 5 or 6, claims for refund under chapter 297A filed 
        after the 3-1/2 year period but within the one-year period are 
        limited to the amount of the tax, penalties, and interest on the 
        order or return made by the commissioner that are due for the 
        period before the 3-1/2 year period. 
           Sec. 25.  Minnesota Statutes 1996, section 297B.035, 
        subdivision 3, is amended to read: 
           Subd. 3.  [SALES IN VIOLATION OF LICENSING REQUIREMENTS.] 
        Motor vehicles sold by a new motor vehicle dealer in 
        contravention of section 168.27, subdivision 10, clause (1)(b) 
        shall not be considered to have been acquired or purchased for 
        resale in the ordinary or regular course of business for the 
        purposes of this chapter, and the dealer shall be required to 
        pay the excise tax due on the purchase of those vehicles.  The 
        sale by a lessor of a new motor vehicle under lease within 120 
        days of the commencement of the lease is deemed a sale in 
        contravention of section 168.27, subdivision 10, clause (1)(b) 
        unless the lessor holds a valid contract or franchise with the 
        manufacturer or distributor of the vehicle.  Notwithstanding 
        section 297B.11, the rights of a dealer to appeal any amounts 
        owed by the dealer under this subdivision are governed 
        exclusively by the hearing procedure under section 168.27, 
        subdivision 13. 
           Sec. 26.  Minnesota Statutes 1996, section 297B.11, is 
        amended to read: 
           297B.11 [REGISTRAR AS AGENT OF COMMISSIONER OF REVENUE; 
        POWERS.] 
           The state commissioner of revenue is charged with the 
        administration of the sales tax on motor vehicles.  The 
        commissioner may prescribe all rules not inconsistent with the 
        provisions of this chapter, necessary and advisable for the 
        proper and efficient administration of the law.  The collection 
        of this sales tax on motor vehicles shall be carried out by the 
        motor vehicle registrar who shall act as the agent of the 
        commissioner and who shall be subject to all rules not 
        inconsistent with the provisions of this chapter, that may be 
        prescribed by the commissioner.  
           The provisions of chapters 289A and 297A relating to the 
        commissioner's authority to audit, assess, and collect the tax, 
        and to refunds and appeals, are applicable to the sales tax on 
        motor vehicles.  The commissioner may impose civil penalties as 
        provided in chapters 289A and 297A, and the additional tax and 
        penalties are subject to interest at the rate provided in 
        section 270.75.  
           Sec. 27.  Minnesota Statutes 1996, section 299F.21, is 
        amended to read: 
           299F.21 [FIRE INSURANCE COMPANIES PAY TAX.] 
           Subdivision 1.  [ESTIMATED INSTALLMENT PAYMENTS.] On or 
        before April 1, June 1, and December 1 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.  
           Subd. 1a.  [ELECTRONIC FUNDS TRANSFER PAYMENTS.] If the 
        aggregate amount of fire marshal tax payments under this section 
        and the premium tax payments under section 60A.15 made during a 
        calendar year is equal to or exceeds $120,000, all tax payments 
        in the subsequent calendar year must be paid by means of a funds 
        transfer as defined in section 336.4A-104, paragraph (a).  The 
        funds transfer payment date, as defined in section 336.4A-401, 
        must be on or before the date the payment is due.  If the date 
        the payment is due is not a funds transfer business day, as 
        defined in section 336.4A-105, paragraph (a), clause (4), the 
        payment date must be on or before the funds transfer business 
        day next following the date the payment is due. 
           Subd. 1b.  [ADDITION TO TAX.] In case of an underpayment of 
        installments by an insurer, there must be added to the tax for 
        the taxable year an amount determined at the rate specified in 
        section 270.75 upon the amount of underpayment. 
           Subd. 1b. 1c.  [AMOUNT OF UNDERPAYMENT.] For purposes of 
        subdivision 1a, the amount of the underpayment is the excess 
        of:  (1) the amount of the installment; over (2) the amount, if 
        any, of the installment paid on or before the last date 
        prescribed for payment. 
           Subd. 1c. 1d.  [PERIOD OF UNDERPAYMENT.] The period of the 
        underpayment runs from the date the installment was required to 
        be paid to the earliest of the following dates: 
           (1) on March 1 following the close of the taxable year; 
           (2) with respect to any portion of the underpayment, the 
        date on which that portion is paid.  For purposes of this 
        clause, a payment of estimated tax on any installment date is 
        considered a payment of any previous underpayment only to the 
        extent the payment exceeds the amount of the installment 
        determined under clause (1), for the installment date. 
           Subd. 1d. 1e.  [DEFINITION OF TAX.] The term "tax" means 
        the tax imposed by this chapter. 
           Subd. 1e. 1f.  [FAILURE TO FILE ESTIMATE.] In the case of 
        an insurer that fails to file an estimated tax statement for a 
        taxable year when one is required, the period of the 
        underpayment runs from the installment dates as set forth in 
        subdivision 1 to whichever of the periods set forth in 
        subdivision 1c is the earlier. 
           Subd. 2.  [ANNUAL RETURNS.] (a) Every insurer required to 
        pay a tax under this section shall make and file a statement of 
        estimated taxes for the period covered by the installment tax 
        payment.  The statement shall be in the form prescribed by the 
        commissioner of revenue.  
           (b) On or before March 1, annually every insurer subject to 
        taxation under this section shall make an annual return for the 
        preceding calendar year setting forth information the 
        commissioner of revenue may reasonably require on forms 
        prescribed by the commissioner.  
           (c) On March 1, the insurer shall pay any additional amount 
        due for the preceding calendar year; if there has been an 
        overpayment, the overpayment may be credited without interest on 
        the estimated tax due April 15.  
           (d) If unpaid by this date, penalties as provided in 
        section 289A.60, subdivision 1, as related to withholding and 
        sales or use taxes, shall be imposed. 
           Sec. 28.  [STATUS OF EXEMPT RULES.] 
           Notwithstanding Minnesota Statutes, section 14.387, the 
        following statutes, and any rules adopted or determinations, 
        actions, or positions taken pursuant to these statutes, have the 
        force and effect of law on and after July 1, 1997:  Minnesota 
        Statutes, sections 124.2131, subdivision 1, paragraph (b); 
        270.75, subdivision 5; 270.76; 270.79, subdivision 4, paragraph 
        (f); 290.06, subdivision 2d; 290A.04, subdivision 6; and 
        297E.15, subdivision 11. 
           Sec. 29.  [EFFECTIVE DATES.] 
           Sections 1, 3, 4, 6, 8 to 12, 14 to 16, 22, 25, 26, and 28 
        are effective the day following final enactment. 
           Sections 2, 13, and 27 are effective for all payments due 
        after December 31, 1997. 
           Sections 5 and 23 are effective for orders of assessment 
        issued on or after the day following final enactment. 
           Section 7 is effective for causes of action arising before 
        the day following final enactment which are not barred by the 
        statute of limitations as of that date, and for causes of action 
        arising thereafter. 
           Sections 17 and 18 are effective for mortgages submitted 
        for recording and deeds executed and delivered after June 30, 
        1997. 
           Section 19 is effective for returns for amounts withheld 
        for periods after December 31, 1997. 
           Section 20 is effective for tax payments for the taxable 
        years beginning after December 31, 1997. 
           Section 21 is effective for withholding on wages after 
        December 31, 1997. 
           Section 24 is effective for claims for refund filed on or 
        after the day following final enactment. 
           Presented to the governor May 1, 1997 
           Signed by the governor May 2, 1997, 3:25 p.m.