2014 Minnesota M1M, Income Additions and Subtractions changes

On December 19, 2014, President Obama signed the Tax Increase Prevention Act of 2014. This federal law resulted in a couple changes being required on the 2014 Minnesota Schedule M1M, Income Additions and Subtractions. The form and instructions have been updated and are now available on our website.

What changed?
Line 6, Schedule M1M. Prior to the passage of the Tax Increase Prevention Act, this line was intentionally left blank. This line has been updated to, “Federal section 179 expensing addition (determine from worksheet in instructions).”

The Act increased the federal allowable section 179 expense deduction from $25,000 to $500,000 and increased the beginning of the phaseout amount from $200,000 to $2,000,000. These federal changes are effective for tax year 2014 only. For more information, see the instructions for Schedule M1M.

Line 36, Schedule M1M. Prior to the passage of the Tax Increase Prevention Act, this line read, “Federally taxable employer-provided mass transit benefits of up to $120/month.” This line has been updated to be intentionally left blank.

The Act increased the federal exclusion for these benefits from $130 per month to $250 per month. This change increased the maximum exclusion of employer-provided mass transit benefits to match the maximum exclusion for employer-provided parking benefits. This federal change is effective for tax year 2014 only. As a result of this change, the subtraction for employer-provided mass transit benefits is obsolete and has been removed from the form.

Software vendors have been notified of these changes. Please make sure to update your software.