Potential impacts to 2017 Minnesota Income Tax returns

Potential impacts to 2017 Minnesota Income Tax returns

Federal legislation signed on February 9, 2018, retroactively extended and modified tax provisions for tax year 2017. We are reviewing this legislation, and will review the guidance from the Internal Revenue Service (IRS), when released, to determine the appropriate steps Minnesota taxpayers should take. We will provide additional information when it is available.

 

At this time, we want you to be aware that some of the changes in the federal legislation may affect your clients if any of the following occurred during 2017:

• They paid tuition and fees for post-secondary education (generally reported on federal Form 1098-T).
• They paid private mortgage insurance (generally reported on federal Form 1098).
• They entered into an arrangement under which debt was discharged on their principal residence including through a short sale or foreclosure.
• They are a part-year Minnesota resident who lived in the California wildfire disaster area between Oct. 8, 2017 and Dec. 31, 2017, and they claimed the federal Earned Income Tax Credit.
• They operated a business on an Indian reservation and placed assets in service.
• They placed certain mine safety equipment in service.
• They operated a motorsports entertainment complex and placed certain property in service.
• They paid certain film, television, or theatrical expenses.
• They suffered a casualty loss of personal property located in the California wildfire disaster area.
• They lived in the California wildfire disaster area between Oct. 8, 2017 and Dec. 31, 2017 and received a distribution from their retirement account.
• They contributed to charitable organization for relief efforts in the California wildfire disaster area.

 

This federal legislation may also affect certain businesses filing their 2017 Minnesota tax return. If any of the provisions included in the legislation affect the amount of taxable income reported on your client’s 2017 federal return, they may be required to adjust their income on their 2017 Minnesota return.

 

We will continue our review of the extended and modified tax provisions for tax year 2017, and will provide additional information to you when it becomes available.