Bill Text: MN SF857 | 2011-2012 | 87th Legislature | Introduced
Bill Title: Wisconsin tax reciprocity agreement negotiation requirement
Sponsorship: Partisan Bill (Republican 1)
Status: (Introduced - Dead) 2011-05-09 - Second reading [SF857 Detail]
Download: Minnesota-2011-SF857-Introduced.html
1.2relating to taxation; individual income; directing commissioner to negotiate a
1.3reciprocity agreement with state of Wisconsin and permitting its termination only
1.4by law;amending Minnesota Statutes 2010, section 290.081.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.6 Section 1. Minnesota Statutes 2010, section 290.081, is amended to read:
1.7290.081 INCOME OF NONRESIDENTS, RECIPROCITY.
1.8 Subdivision 1. Reciprocity with other states. (a) The compensation received for
1.9the performance of personal or professional services within this state by an individual
1.10whose residence, place of abode, and place customarily returned to at least once a month
1.11is in another state, shall be excluded from gross income to the extent such compensation is
1.12subject to an income tax imposed by the state of residence; provided that such state allows
1.13a similar exclusion of compensation received by residents of Minnesota for services
1.14performed therein.
1.15(b)When it is deemed to be in the best interests of the people of this state, the
1.16commissioner may determine that the provisions of paragraph (a) shall not apply. As long
1.17as the provisions of paragraph (a) apply between Minnesota and Wisconsin, the provisions
1.18of paragraph (a) shall apply to any individual who is domiciled in Wisconsin.
1.19(c) For the purposes of paragraph (a), whenever the Wisconsin tax on Minnesota
1.20residents which would have been paid Wisconsin without paragraph (a) exceeds the
1.21Minnesota tax on Wisconsin residents which would have been paid Minnesota without
1.22paragraph (a), or vice versa, then the state with the net revenue loss resulting from
1.23paragraph (a) must be compensated by the other state as provided in the agreement under
1.24paragraph (d). This provision shall be effective for all years beginning after December 31,
2.11972. The data used for computing the loss to either state shall be determined on or before
2.2September 30 of the year following the close of the previous calendar year.
2.3(d) Interest is payable on all amounts calculated under paragraph (c) relating to
2.4taxable years beginning after December 31, 2000 and before January 1, 2010. Interest
2.5accrues from July 1 of the taxable year.
2.6(e) Thecommissioner of revenue is authorized to enter into agreements reciprocity
2.7agreement with the state of Wisconsinspecifying must specify the compensation required
2.8under paragraph (b),the one or more reciprocity payment due date, dates for the revenue
2.9loss relating to each taxable year, with one or more estimated payment due dates in the
2.10same fiscal year in which the revenue loss occurred, and a final payment in the following
2.11fiscal year, conditions constituting delinquency, interest rates, and a method for computing
2.12interest due. Interest is payable from July 1 of the taxable year on final payments made in
2.13the following fiscal year. Calculation of compensation under the agreement must specify
2.14if the revenue loss is determined before or after the allowance of each state's credit for
2.15taxes paid to the other state.
2.16(e) (f) If an agreement cannot be reached as to the amount of the loss, the
2.17commissioner of revenue and the taxing official of the state of Wisconsin shall each
2.18appoint a member of a board of arbitration and these members shall appoint the third
2.19member of the board. The board shall select one of its members as chair. Such board may
2.20administer oaths, take testimony, subpoena witnesses, and require their attendance, require
2.21the production of books, papers and documents, and hold hearings at such places as are
2.22deemed necessary. The board shall then make a determination as to the amount to be paid
2.23the other state which determination shall be final and conclusive.
2.24(f) (g) The commissioner may furnish copies of returns, reports, or other information
2.25to the taxing official of the state of Wisconsin, a member of the board of arbitration, or a
2.26consultant under joint contract with the states of Minnesota and Wisconsin for the purpose
2.27of making a determination as to the amount to be paid the other state under the provisions
2.28of this section. Prior to the release of any information under the provisions of this section,
2.29the person to whom the information is to be released shall sign an agreement which
2.30provides that the person will protect the confidentiality of the returns and information
2.31revealed thereby to the extent that it is protected under the laws of the state of Minnesota.
2.32(h) Any reciprocity agreement entered into under this section continues in effect
2.33until terminated by Minnesota or Wisconsin law. The commissioner may agree to modify
2.34the timing or method of calculating the state payments to be made under the agreement,
2.35consistent with the requirements of paragraphs (c) and (e), but may not terminate the
2.36agreement.
3.1 Subd. 2. New reciprocity agreement with Wisconsin. The commissioner of
3.2revenue is directed to initiate negotiations with the secretary of revenue of Wisconsin,
3.3with the objective of entering into an income tax reciprocity agreement effective for tax
3.4years beginning after December 31, 2011. The agreement must satisfy the conditions of
3.5subdivision 1, with one or more estimated payment due dates and a final payment due
3.6date specified so that the state with a net revenue loss as a result of the agreement receives
3.7estimated payments from the other state, in the same fiscal year as that in which the net
3.8revenue loss occurred and a final payment with interest in the following fiscal year.
3.9EFFECTIVE DATE.Subdivision 2 is effective the day following final enactment.
3.10The changes to subdivision 1 are effective for taxable years beginning after December 31
3.11of the year of the agreement, contingent upon agreement from the state of Wisconsin to a
3.12reciprocity arrangement in which estimated payments are made in the same fiscal year in
3.13which a change in revenue occurs, and a final payment is made in the following fiscal year.
1.3reciprocity agreement with state of Wisconsin and permitting its termination only
1.4by law;amending Minnesota Statutes 2010, section 290.081.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.6 Section 1. Minnesota Statutes 2010, section 290.081, is amended to read:
1.7290.081 INCOME OF NONRESIDENTS, RECIPROCITY.
1.8 Subdivision 1. Reciprocity with other states. (a) The compensation received for
1.9the performance of personal or professional services within this state by an individual
1.10whose residence, place of abode, and place customarily returned to at least once a month
1.11is in another state, shall be excluded from gross income to the extent such compensation is
1.12subject to an income tax imposed by the state of residence; provided that such state allows
1.13a similar exclusion of compensation received by residents of Minnesota for services
1.14performed therein.
1.15(b)
1.16
1.17as the provisions of paragraph (a) apply between Minnesota and Wisconsin, the provisions
1.18of paragraph (a) shall apply to any individual who is domiciled in Wisconsin.
1.19(c) For the purposes of paragraph (a), whenever the Wisconsin tax on Minnesota
1.20residents which would have been paid Wisconsin without paragraph (a) exceeds the
1.21Minnesota tax on Wisconsin residents which would have been paid Minnesota without
1.22paragraph (a), or vice versa, then the state with the net revenue loss resulting from
1.23paragraph (a) must be compensated by the other state as provided in the agreement under
1.24paragraph (d). This provision shall be effective for all years beginning after December 31,
2.11972. The data used for computing the loss to either state shall be determined on or before
2.2September 30 of the year following the close of the previous calendar year.
2.3(d) Interest is payable on all amounts calculated under paragraph (c) relating to
2.4taxable years beginning after December 31, 2000 and before January 1, 2010. Interest
2.5accrues from July 1 of the taxable year.
2.6(e) The
2.7agreement with the state of Wisconsin
2.8under paragraph (b),
2.9loss relating to each taxable year, with one or more estimated payment due dates in the
2.10same fiscal year in which the revenue loss occurred, and a final payment in the following
2.11fiscal year, conditions constituting delinquency, interest rates, and a method for computing
2.12interest due. Interest is payable from July 1 of the taxable year on final payments made in
2.13the following fiscal year. Calculation of compensation under the agreement must specify
2.14if the revenue loss is determined before or after the allowance of each state's credit for
2.15taxes paid to the other state.
2.16
2.17commissioner of revenue and the taxing official of the state of Wisconsin shall each
2.18appoint a member of a board of arbitration and these members shall appoint the third
2.19member of the board. The board shall select one of its members as chair. Such board may
2.20administer oaths, take testimony, subpoena witnesses, and require their attendance, require
2.21the production of books, papers and documents, and hold hearings at such places as are
2.22deemed necessary. The board shall then make a determination as to the amount to be paid
2.23the other state which determination shall be final and conclusive.
2.24
2.25to the taxing official of the state of Wisconsin, a member of the board of arbitration, or a
2.26consultant under joint contract with the states of Minnesota and Wisconsin for the purpose
2.27of making a determination as to the amount to be paid the other state under the provisions
2.28of this section. Prior to the release of any information under the provisions of this section,
2.29the person to whom the information is to be released shall sign an agreement which
2.30provides that the person will protect the confidentiality of the returns and information
2.31revealed thereby to the extent that it is protected under the laws of the state of Minnesota.
2.32(h) Any reciprocity agreement entered into under this section continues in effect
2.33until terminated by Minnesota or Wisconsin law. The commissioner may agree to modify
2.34the timing or method of calculating the state payments to be made under the agreement,
2.35consistent with the requirements of paragraphs (c) and (e), but may not terminate the
2.36agreement.
3.1 Subd. 2. New reciprocity agreement with Wisconsin. The commissioner of
3.2revenue is directed to initiate negotiations with the secretary of revenue of Wisconsin,
3.3with the objective of entering into an income tax reciprocity agreement effective for tax
3.4years beginning after December 31, 2011. The agreement must satisfy the conditions of
3.5subdivision 1, with one or more estimated payment due dates and a final payment due
3.6date specified so that the state with a net revenue loss as a result of the agreement receives
3.7estimated payments from the other state, in the same fiscal year as that in which the net
3.8revenue loss occurred and a final payment with interest in the following fiscal year.
3.9EFFECTIVE DATE.Subdivision 2 is effective the day following final enactment.
3.10The changes to subdivision 1 are effective for taxable years beginning after December 31
3.11of the year of the agreement, contingent upon agreement from the state of Wisconsin to a
3.12reciprocity arrangement in which estimated payments are made in the same fiscal year in
3.13which a change in revenue occurs, and a final payment is made in the following fiscal year.
