Qualify for new tax breaks? Wait to file returns
ST. PAUL -- Minnesota revenue officials will not be ready to pay Minnesotans for newly enacted tax breaks until April 3.
Revenue Commissioner Myron Frans today advised Minnesotans who may qualify for one of 10 new individual income tax breaks not to file income tax returns until then. He said that is when tax preparers, software companies and his Revenue Department should be ready.
Taxpayers who do not qualify for the new tax breaks can go ahead and file returns, he added.
"About 1 in 10 taxpayers probably will be able to benefit," he said, meaning that up to 275,000 people will split the $49 million in new tax breaks.
Minnesotans who already have filed their returns and qualify for one of the new breaks do not need to do anything, Frans said. The Revenue Department will contact them and let them know about their new, and bigger, refunds and whether they need to file an amended return.
However, Frans said, the department does not know how soon employees will be able to comb through returns to find those who are owed bigger refunds.
In many cases, Revenue Department employees hope to make changes themselves and increase refunds. In other cases, the department will notify taxpayers they must file an amended return to take advantage of the law.
"This is a very complex task we are undertaking," Assistant Revenue Commissioner Terri Steenblock said.
The tax bill lawmakers passed and Gov. Mark Dayton signed Friday set aside $1 million for the department to undertake the job.
Tax returns must be filed by April 15.
New and newly expanded state income tax cuts are:
-- Working Family Credit.
-- Mortgage insurance deduction.
-- Mortgage debt forgiveness.
-- Educator expenses deduction.
-- Higher education tuition deduction.
-- Student loan interest deduction.
-- Education savings account exclusion.
-- National Health Corps scholarship exclusion.
-- Employer-provides education, adoption and transit assistance exclusion.
-- Tax-free individual retirement account exclusion.