Undesignated money returned to the state through restitution or recovery required to be deposited in a taxpayer refund account, annual distribution of funds provided, and rulemaking required.

This bill establishes a new taxpayer refund account in Minnesota to hold undesignated money returned to the state through restitution, fraud recovery, overpayment recovery, administrative fines, or other reimbursements. State agencies must transfer these recovered funds to the commissioner of management and budget within 60 days of receipt, and the funds must be used exclusively for issuing refunds to individual taxpayers who filed Minnesota income tax returns. The commissioner will distribute the accumulated funds as direct payments to eligible taxpayers once the account balance exceeds $300 million, with refunds issued within 120 days after the legislative session ends. The bill also requires the commissioner to create rules for administering the account and determining the refund distribution formula, with provisions taking effect on July 1, 2026.