Taxes

This bill expands how Minnesota cities and counties can use local affordable housing aid by adding emergency rental assistance and support for financially distressed properties to the list of eligible projects. It also updates the timeline for spending these funds, requiring that aid be committed to projects within three years and fully spent within four years, with a specific exception allowing more time for construction and shelter facility projects. Additionally, the legislation mandates that new multi-unit buildings funded by this aid include a minimum percentage of accessible and sensory-accessible units to better serve people with disabilities. These changes apply to aid payments made in calendar year 2027 and later, aiming to provide greater flexibility and broader coverage for local housing initiatives.

HF 5092 modifies how Minnesota distributes revenue from mineral production taxes to school districts. The bill updates the specific dollar amounts and formulas used to allocate funds, ensuring that districts near taconite mines and those in designated tax relief areas receive their designated shares. It also clarifies how money from specific mining facilities is directed to particular school districts and establishes rules for funding early childhood programs in qualifying areas.

HF 2133 makes a technical correction to Minnesota's tax law regarding credits for pass-through entity taxes paid to other states. The bill clarifies that businesses structured as pass-through entities (such as partnerships, LLCs, and S corporations) and their owners can claim a credit for taxes paid to another state, specifying how this credit must be claimed per tax commissioner rules. It also aligns the credit's expiration with a federal tax provision without affecting the state's authority to audit or assess claims. This amendment corrects a technical error in existing law to ensure the credit is applied as intended, without changing tax rates or eligibility.

This bill modifies Minnesota's individual income and corporate franchise tax laws to require companies to add back certain pharmaceutical marketing expenses. Specifically, it targets direct-to-consumer advertising for prescription drugs and biologics, which are currently deductible under federal tax rules. The legislation defines these marketing activities as promotional efforts aimed at consumers through various media channels and applies to manufacturers who produce these medications. Starting with taxable years beginning after December 31, 2026, companies will no longer be able to deduct the costs of these specific marketing campaigns when calculating their state tax liability.

This bill establishes a new state wealth tax in Minnesota that would apply to individuals and trusts with taxable wealth exceeding $10 million. The tax would be calculated as one percent of the amount above that threshold, based on the total value of all property owned within Minnesota minus any debts owed by the taxpayer. Property values would be determined using the same valuation methods used for federal estate taxes, and the tax would apply to both residents and nonresidents who own property in the state. The legislation would take effect for taxable years beginning after December 31, 2025, and would be collected in addition to existing state taxes.