1.1.................... moves to amend H.F. No. 1219 as follows:
1.2Delete everything after the enacting clause and insert:


1.5    Section 1. Minnesota Statutes 2010, section 270C.34, subdivision 1, is amended to read:
1.6    Subdivision 1. Authority. (a) The commissioner may abate, reduce, or refund any
1.7penalty or interest that is imposed by a law administered by the commissioner, or imposed
1.8by section 270.0725, subdivision 1 or 2, as a result of the late payment of tax or late filing
1.9of a return, or any part of an additional tax charge under section 289A.25, subdivision 2,
1.10or 289A.26, subdivision 4, if the failure to timely pay the tax or failure to timely file the
1.11return is due to reasonable cause, or if the taxpayer is located in a presidentially declared
1.12disaster or in a presidentially declared state of emergency area or in an area declared to be
1.13in a state of emergency by the governor under section 12.31.
1.14    (b) The commissioner shall abate any part of a penalty or additional tax charge
1.15under section 289A.25, subdivision 2, or 289A.26, subdivision 4, attributable to erroneous
1.16advice given to the taxpayer in writing by an employee of the department acting in
1.17an official capacity, if the advice:
1.18    (1) was reasonably relied on and was in response to a specific written request of the
1.19taxpayer; and
1.20    (2) was not the result of failure by the taxpayer to provide adequate or accurate
1.21information.
1.22EFFECTIVE DATE.This section is effective for taxable years beginning after
1.23December 31, 2010.

1.24    Sec. 2. Minnesota Statutes 2010, section 289A.08, subdivision 1, is amended to read:
2.1    Subdivision 1. Generally; individuals. (a) A taxpayer must file a return for each
2.2taxable year the taxpayer is required to file a return under section 6012 of the Internal
2.3Revenue Code, except that:
2.4(1) an individual who is not a Minnesota resident for any part of the year is not
2.5required to file a Minnesota income tax return if the individual's gross income derived
2.6from Minnesota sources as determined under sections 290.081, paragraph (a), and 290.17,
2.7is less than the filing requirements for a single individual who is a full year resident of
2.8Minnesota; and
2.9(2) an individual who is a Minnesota resident is not required to file a Minnesota
2.10income tax return if the individual's gross income derived from Minnesota sources as
2.11determined under section 290.17, less the amount of the individual's gross income that
2.12consists of compensation paid to members of the armed forces of the United States or
2.13United Nations for active duty performed outside Minnesota subtraction allowed under
2.14section 290.01, subdivision 19b, clauses (11) and (14), is less than the filing requirements
2.15for a single individual who is a full-year resident of Minnesota.
2.16(b) The decedent's final income tax return, and other income tax returns for prior
2.17years where the decedent had gross income in excess of the minimum amount at which
2.18an individual is required to file and did not file, must be filed by the decedent's personal
2.19representative, if any. If there is no personal representative, the return or returns must
2.20be filed by the transferees, as defined in section 270C.58, subdivision 3, who receive
2.21property of the decedent.
2.22(c) The term "gross income," as it is used in this section, has the same meaning
2.23given it in section 290.01, subdivision 20.
2.24EFFECTIVE DATE.This section is effective for taxable years beginning after
2.25December 31, 2010.

2.26    Sec. 3. Minnesota Statutes 2010, section 289A.08, subdivision 7, is amended to read:
2.27    Subd. 7. Composite income tax returns for nonresident partners, shareholders,
2.28and beneficiaries. (a) The commissioner may allow a partnership with nonresident
2.29partners to file a composite return and to pay the tax on behalf of nonresident partners who
2.30have no other Minnesota source income. This composite return must include the names,
2.31addresses, Social Security numbers, income allocation, and tax liability for the nonresident
2.32partners electing to be covered by the composite return.
2.33(b) The computation of a partner's tax liability must be determined by multiplying
2.34the income allocated to that partner by the highest rate used to determine the tax liability
3.1for individuals under section 290.06, subdivision 2c. Nonbusiness deductions, standard
3.2deductions, or personal exemptions are not allowed.
3.3(c) The partnership must submit a request to use this composite return filing method
3.4for nonresident partners. The requesting partnership must file a composite return in the
3.5form prescribed by the commissioner of revenue. The filing of a composite return is
3.6considered a request to use the composite return filing method.
3.7(d) The electing partner must not have any Minnesota source income other than
3.8the income from the partnership and other electing partnerships. If it is determined that
3.9the electing partner has other Minnesota source income, the inclusion of the income
3.10and tax liability for that partner under this provision will not constitute a return to
3.11satisfy the requirements of subdivision 1. The tax paid for the individual as part of the
3.12composite return is allowed as a payment of the tax by the individual on the date on
3.13which the composite return payment was made. If the electing nonresident partner has no
3.14other Minnesota source income, filing of the composite return is a return for purposes of
3.15subdivision 1.
3.16(e) This subdivision does not negate the requirement that an individual pay estimated
3.17tax if the individual's liability would exceed the requirements set forth in section 289A.25.
3.18A composite estimate may, however, be filed in a manner similar to and containing the
3.19information required under paragraph (a). The individual's liability to pay estimated tax
3.20is, however, satisfied when the partnership pays composite estimated tax in the manner
3.21prescribed in section 289A.25.
3.22(f) If an electing partner's share of the partnership's gross income from Minnesota
3.23sources is less than the filing requirements for a nonresident under this subdivision, the tax
3.24liability is zero. However, a statement showing the partner's share of gross income must
3.25be included as part of the composite return.
3.26(g) The election provided in this subdivision is only available to a partner who has
3.27no other Minnesota source income and who is either (1) a full-year nonresident individual
3.28or (2) a trust or estate that does not claim a deduction under either section 651 or 661 of
3.29the Internal Revenue Code.
3.30(h) A corporation defined in section 290.9725 and its nonresident shareholders may
3.31make an election under this paragraph. The provisions covering the partnership apply to
3.32the corporation and the provisions applying to the partner apply to the shareholder.
3.33(i) Estates and trusts distributing current income only and the nonresident individual
3.34beneficiaries of the estates or trusts may make an election under this paragraph. The
3.35provisions covering the partnership apply to the estate or trust. The provisions applying to
3.36the partner apply to the beneficiary.
4.1(j) For the purposes of this subdivision, "income" means the partner's share of
4.2federal adjusted gross income from the partnership modified by the additions provided
4.3in section 290.01, subdivision 19a, clauses (6) to (10), and the subtractions provided in:
4.4(i) section 290.01, subdivision 19b, clause (8), to the extent the amount is assignable or
4.5allocable to Minnesota under section 290.17; and (ii) section 290.01, subdivision 19b,
4.6clause (13). The subtraction allowed under section 290.01, subdivision 19b, clause (8), is
4.7only allowed on the composite tax computation to the extent the electing partner would
4.8have been allowed the subtraction.
4.9EFFECTIVE DATE.This section is effective for taxable years beginning after
4.10December 31, 2010.

4.11    Sec. 4. Minnesota Statutes 2010, section 289A.12, is amended by adding a subdivision
4.12to read:
4.13    Subd. 17. Third-party payers of sick pay benefits. (a) A third-party payer of sick
4.14pay benefits who withholds income tax from the sick pay of an employee as agent for the
4.15employer of the employee, and who remits that withholding tax to the commissioner must
4.16file an annual report on a form prescribed by the commissioner. The report must include
4.17the name and tax identification number of each employer for whom the payer has made
4.18sick pay payments and the name, Social Security number, amount of sick pay paid, and
4.19amount of tax withheld for each employee.
4.20(b) The report must be filed with the commissioner on or before February 28 of the
4.21year following the year in which the sick pay benefits were paid.
4.22(c) The report required by this subdivision does not need to be filed if the third-party
4.23payer, rather than the employer, has provided to the employee the annual statement
4.24required under section 289A.09, subdivision 2, that includes the sick pay benefits paid
4.25and the tax withheld.
4.26EFFECTIVE DATE.This section is effective for benefits paid after December
4.2731, 2010.

4.28    Sec. 5. Minnesota Statutes 2010, section 289A.25, subdivision 1, is amended to read:
4.29    Subdivision 1. Requirements to pay. An individual, trust, S corporation, or
4.30partnership must, when prescribed in subdivision 3, paragraph (b), make payments of
4.31estimated tax. For individuals, the term "estimated tax" means the amount the taxpayer
4.32estimates is the sum of the taxes imposed by chapter 290 for the taxable year. For trusts,
4.33S corporations, and partnerships, the term estimated tax means the amount the taxpayer
5.1estimates is the sum of the taxes for the taxable year imposed by chapter 290 and the
5.2composite income tax imposed by section 289A.08, subdivision 7. If the individual is an
5.3infant or incompetent person, the payments must be made by the individual's guardian. If
5.4joint payments on estimated tax are made but a joint return is not made for the taxable
5.5year, the estimated tax for that year may be treated as the estimated tax of either the
5.6husband or the wife or may be divided between them.
5.7Notwithstanding the provisions of this section, no payments of estimated tax are
5.8required if the estimated tax, as defined in this subdivision, less the credits allowed against
5.9the tax, is less than $500.
5.10EFFECTIVE DATE.This section is effective for taxable years beginning after
5.11December 31, 2010.

5.12    Sec. 6. Minnesota Statutes 2010, section 289A.25, subdivision 6, is amended to read:
5.13    Subd. 6. Exception to addition to tax. (a) For individuals, no addition to the tax
5.14shall be is imposed under this section for any taxable year if:
5.15(1) the taxpayer did not have liability for tax for the preceding taxable year,
5.16(2) the preceding taxable year was a taxable year of 12 months, and
5.17(3) the individual or trust was a resident of Minnesota throughout the preceding
5.18taxable year.
5.19(b) For trusts, S corporations, and partnerships, if in any previous taxable year the
5.20entity was subject to taxation under chapter 290 or composite income tax is elected under
5.21section 289A.08, subdivision 7, then an addition to the tax is imposed under this section.
5.22In all other taxable years, no addition to tax is imposed under this section.
5.23EFFECTIVE DATE.This section is effective for taxable years beginning after
5.24December 31, 2010.

5.25    Sec. 7. Minnesota Statutes 2010, section 289A.25, is amended by adding a subdivision
5.26to read:
5.27    Subd. 14. Short taxable year. (a) A trust, S corporation, or partnership with a
5.28short taxable year of less than 12 months, but at least four months, must pay estimated
5.29tax in equal installments on or before the 15th day of the third, sixth, ninth, and final
5.30month of the short taxable year, to the extent applicable based on the number of months
5.31in the short taxable year.
6.1(b) A trust, S corporation, or partnership is not required to make estimated tax
6.2payments for a short taxable year unless its tax liability before the first day of the last
6.3month of the taxable year can reasonably be expected to exceed $500.
6.4(c) No payment is required by a trust, S corporation, or partnership for a short
6.5taxable year of less than four months.
6.6EFFECTIVE DATE.This section is effective for taxable years beginning after
6.7December 31, 2010.

6.8    Sec. 8. Minnesota Statutes 2010, section 289A.26, subdivision 1, is amended to read:
6.9    Subdivision 1. Minimum liability. A corporation subject to taxation under chapter
6.10290 (excluding section 290.92 and an S corporation under section 290.9725) or an entity
6.11subject to taxation under section 290.05, subdivision 3, must make payment of estimated
6.12tax for the taxable year if its tax liability so computed can reasonably be expected to
6.13exceed $500, or in accordance with rules prescribed by the commissioner for an affiliated
6.14group of corporations filing one return under section 289A.08, subdivision 3.
6.15EFFECTIVE DATE.This section is effective for taxable years beginning after
6.16December 31, 2010.

6.17    Sec. 9. Minnesota Statutes 2010, section 289A.50, subdivision 10, is amended to read:
6.18    Subd. 10. Limitation on refund. (a) If an addition to federal taxable income under
6.19section 290.01, subdivision 19a, clause (1), is judicially determined to discriminate
6.20against interstate commerce with respect to obligations of a certain character or type, the
6.21legislature intends that the discrimination be remedied by adding to federal taxable income
6.22interest on comparable obligations of Minnesota governmental units and Indian tribes to
6.23federal taxable income. For purposes of this subdivision, "comparable obligation" means
6.24obligations of the character or type that the court found to be unconstitutionally favored by
6.25section 290.01, subdivision 19a, clause (1), whether based on the security for payment,
6.26use of the proceeds, or any other factor identified as determinative by the court.
6.27(b) This subdivision applies beginning with the taxable years that begin during the
6.28calendar year in which the court's decision is final. Other remedies apply for previous
6.29taxable years.
6.30EFFECTIVE DATE.This section is effective the day following final enactment.

6.31    Sec. 10. Minnesota Statutes 2010, section 290.01, subdivision 19a, is amended to read:
7.1    Subd. 19a. Additions to federal taxable income. For individuals, estates, and
7.2trusts, there shall be added to federal taxable income:
7.3    (1)(i) interest income on obligations of any state other than Minnesota or a political
7.4or governmental subdivision, municipality, or governmental agency or instrumentality
7.5of any state other than Minnesota exempt from federal income taxes under the Internal
7.6Revenue Code or any other federal statute; and
7.7    (ii) exempt-interest dividends as defined in section 852(b)(5) of the Internal Revenue
7.8Code, except:
7.9(A) the portion of the exempt-interest dividends exempt from state taxation under
7.10the laws of the United States; and
7.11(B) the portion of the exempt-interest dividends derived from interest income
7.12on obligations of the state of Minnesota or its political or governmental subdivisions,
7.13municipalities, governmental agencies or instrumentalities, but only if the portion of the
7.14exempt-interest dividends from such Minnesota sources paid to all shareholders represents
7.1595 percent or more of the exempt-interest dividends, including any dividends exempt
7.16under subitem (A), that are paid by the regulated investment company as defined in section
7.17851(a) of the Internal Revenue Code, or the fund of the regulated investment company as
7.18defined in section 851(g) of the Internal Revenue Code, making the payment; and
7.19    (iii) for the purposes of items (i) and (ii), interest on obligations of an Indian tribal
7.20government described in section 7871(c) of the Internal Revenue Code shall be treated as
7.21interest income on obligations of the state in which the tribe is located;
7.22    (2) the amount of income, sales and use, motor vehicle sales, or excise taxes paid
7.23or accrued within the taxable year under this chapter and the amount of taxes based on
7.24net income paid, sales and use, motor vehicle sales, or excise taxes paid to any other
7.25state or to any province or territory of Canada, to the extent allowed as a deduction
7.26under section 63(d) of the Internal Revenue Code, but the addition may not be more
7.27than the amount by which the itemized deductions as allowed under section 63(d) of
7.28the Internal Revenue Code exceeds the amount of the standard deduction as defined in
7.29section 63(c) of the Internal Revenue Code, disregarding the amounts allowed under
7.30sections 63(c)(1)(C) and 63(c)(1)(E) of the Internal Revenue Code. For the purpose of
7.31this paragraph, the disallowance of itemized deductions under section 68 of the Internal
7.32Revenue Code of 1986, income, sales and use, motor vehicle sales, or excise taxes are
7.33the last itemized deductions disallowed;
7.34    (3) the capital gain amount of a lump-sum distribution to which the special tax under
7.35section 1122(h)(3)(B)(ii) of the Tax Reform Act of 1986, Public Law 99-514, applies;
8.1    (4) the amount of income taxes paid or accrued within the taxable year under this
8.2chapter and taxes based on net income paid to any other state or any province or territory
8.3of Canada, to the extent allowed as a deduction in determining federal adjusted gross
8.4income. For the purpose of this paragraph, income taxes do not include the taxes imposed
8.5by sections 290.0922, subdivision 1, paragraph (b), 290.9727, 290.9728, and 290.9729;
8.6    (5) the amount of expense, interest, or taxes disallowed pursuant to section 290.10
8.7other than expenses or interest used in computing net interest income for the subtraction
8.8allowed under subdivision 19b, clause (1);
8.9    (6) the amount of a partner's pro rata share of net income which does not flow
8.10through to the partner because the partnership elected to pay the tax on the income under
8.11section 6242(a)(2) of the Internal Revenue Code;
8.12    (7) 80 percent of the depreciation deduction allowed under section 168(k) of the
8.13Internal Revenue Code. For purposes of this clause, if the taxpayer has an activity that
8.14in the taxable year generates a deduction for depreciation under section 168(k) and the
8.15activity generates a loss for the taxable year that the taxpayer is not allowed to claim for
8.16the taxable year, "the depreciation allowed under section 168(k)" for the taxable year is
8.17limited to excess of the depreciation claimed by the activity under section 168(k) over the
8.18amount of the loss from the activity that is not allowed in the taxable year. In succeeding
8.19taxable years when the losses not allowed in the taxable year are allowed, the depreciation
8.20under section 168(k) is allowed;
8.21    (8) 80 percent of the amount by which the deduction allowed by section 179 of the
8.22Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal
8.23Revenue Code of 1986, as amended through December 31, 2003;
8.24    (9) to the extent deducted in computing federal taxable income, the amount of the
8.25deduction allowable under section 199 of the Internal Revenue Code;
8.26    (10) the exclusion allowed under section 139A of the Internal Revenue Code for
8.27federal subsidies for prescription drug plans;
8.28(11) the amount of expenses disallowed under section 290.10, subdivision 2;
8.29    (12) the amount deducted for qualified tuition and related expenses under section
8.30222 of the Internal Revenue Code, to the extent deducted from gross income;
8.31    (13) the amount deducted for certain expenses of elementary and secondary school
8.32teachers under section 62(a)(2)(D) of the Internal Revenue Code, to the extent deducted
8.33from gross income;
8.34(14) the additional standard deduction for property taxes payable that is allowable
8.35under section 63(c)(1)(C) of the Internal Revenue Code;
9.1(15) the additional standard deduction for qualified motor vehicle sales taxes
9.2allowable under section 63(c)(1)(E) of the Internal Revenue Code;
9.3(16) discharge of indebtedness income resulting from reacquisition of business
9.4indebtedness and deferred under section 108(i) of the Internal Revenue Code; and
9.5(17) the amount of unemployment compensation exempt from tax under section
9.685(c) of the Internal Revenue Code; and
9.7(18) changes to federal taxable income attributable to a net operating loss that the
9.8taxpayer elected to carry back for more than two years for federal purposes but for which
9.9the losses can be carried back for only two years under section 290.095, subdivision
9.1011, paragraph (c).
9.11EFFECTIVE DATE.This section is effective retroactively for losses generated in
9.12taxable years beginning after December 31, 2007.

9.13    Sec. 11. Minnesota Statutes 2010, section 290.01, subdivision 19b, is amended to read:
9.14    Subd. 19b. Subtractions from federal taxable income. For individuals, estates,
9.15and trusts, there shall be subtracted from federal taxable income:
9.16    (1) net interest income on obligations of any authority, commission, or
9.17instrumentality of the United States to the extent includable in taxable income for federal
9.18income tax purposes but exempt from state income tax under the laws of the United States;
9.19    (2) if included in federal taxable income, the amount of any overpayment of income
9.20tax to Minnesota or to any other state, for any previous taxable year, whether the amount
9.21is received as a refund or as a credit to another taxable year's income tax liability;
9.22    (3) the amount paid to others, less the amount used to claim the credit allowed under
9.23section 290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten
9.24to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and
9.25transportation of each qualifying child in attending an elementary or secondary school
9.26situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a
9.27resident of this state may legally fulfill the state's compulsory attendance laws, which
9.28is not operated for profit, and which adheres to the provisions of the Civil Rights Act
9.29of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or
9.30tuition as defined in section 290.0674, subdivision 1, clause (1). As used in this clause,
9.31"textbooks" includes books and other instructional materials and equipment purchased
9.32or leased for use in elementary and secondary schools in teaching only those subjects
9.33legally and commonly taught in public elementary and secondary schools in this state.
9.34Equipment expenses qualifying for deduction includes expenses as defined and limited in
9.35section 290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional
10.1books and materials used in the teaching of religious tenets, doctrines, or worship, the
10.2purpose of which is to instill such tenets, doctrines, or worship, nor does it include books
10.3or materials for, or transportation to, extracurricular activities including sporting events,
10.4musical or dramatic events, speech activities, driver's education, or similar programs. No
10.5deduction is permitted for any expense the taxpayer incurred in using the taxpayer's or
10.6the qualifying child's vehicle to provide such transportation for a qualifying child. For
10.7purposes of the subtraction provided by this clause, "qualifying child" has the meaning
10.8given in section 32(c)(3) of the Internal Revenue Code;
10.9    (4) income as provided under section 290.0802;
10.10    (5) to the extent included in federal adjusted gross income, income realized on
10.11disposition of property exempt from tax under section 290.491;
10.12    (6) to the extent not deducted or not deductible pursuant to section 408(d)(8)(E)
10.13of the Internal Revenue Code in determining federal taxable income by an individual
10.14who does not itemize deductions for federal income tax purposes for the taxable year, an
10.15amount equal to 50 percent of the excess of charitable contributions over $500 allowable
10.16as a deduction for the taxable year under section 170(a) of the Internal Revenue Code,
10.17under the provisions of Public Law 109-1 and Public Law 111-126;
10.18    (7) for individuals who are allowed a federal foreign tax credit for taxes that do not
10.19qualify for a credit under section 290.06, subdivision 22, an amount equal to the carryover
10.20of subnational foreign taxes for the taxable year, but not to exceed the total subnational
10.21foreign taxes reported in claiming the foreign tax credit. For purposes of this clause,
10.22"federal foreign tax credit" means the credit allowed under section 27 of the Internal
10.23Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed
10.24under section 904(c) of the Internal Revenue Code minus national level foreign taxes to
10.25the extent they exceed the federal foreign tax credit;
10.26    (8) in each of the five tax years immediately following the tax year in which an
10.27addition is required under subdivision 19a, clause (7), or 19c, clause (15), in the case
10.28of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth
10.29of the delayed depreciation. For purposes of this clause, "delayed depreciation" means
10.30the amount of the addition made by the taxpayer under subdivision 19a, clause (7), or
10.31subdivision 19c, clause (15), in the case of a shareholder of an S corporation, minus the
10.32positive value of any net operating loss under section 172 of the Internal Revenue Code
10.33generated for the tax year of the addition. The resulting delayed depreciation cannot be
10.34less than zero;
10.35    (9) job opportunity building zone income as provided under section 469.316;
11.1    (10) to the extent included in federal taxable income, the amount of compensation
11.2paid to members of the Minnesota National Guard or other reserve components of the
11.3United States military for active service performed in Minnesota, excluding compensation
11.4for services performed under the Active Guard Reserve (AGR) program. For purposes of
11.5this clause, "active service" means (i) state active service as defined in section 190.05,
11.6subdivision 5a , clause (1); or (ii) federally funded state active service as defined in
11.7section 190.05, subdivision 5b; or (iii) federal active service as defined in section 190.05,
11.8subdivision 5c , but "active service" excludes service performed in accordance with section
11.9190.08, subdivision 3 ;
11.10    (11) to the extent included in federal taxable income, the amount of compensation
11.11paid to Minnesota residents who are members of the armed forces of the United States or
11.12United Nations for active duty performed outside Minnesota under United States Code,
11.13title 10, section 101(d); United States Code, title 32, section 101(12); or the authority of
11.14the United Nations;
11.15    (12) an amount, not to exceed $10,000, equal to qualified expenses related to a
11.16qualified donor's donation, while living, of one or more of the qualified donor's organs
11.17to another person for human organ transplantation. For purposes of this clause, "organ"
11.18means all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow;
11.19"human organ transplantation" means the medical procedure by which transfer of a human
11.20organ is made from the body of one person to the body of another person; "qualified
11.21expenses" means unreimbursed expenses for both the individual and the qualified donor
11.22for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses
11.23may be subtracted under this clause only once; and "qualified donor" means the individual
11.24or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An
11.25individual may claim the subtraction in this clause for each instance of organ donation for
11.26transplantation during the taxable year in which the qualified expenses occur;
11.27    (13) in each of the five tax years immediately following the tax year in which an
11.28addition is required under subdivision 19a, clause (8), or 19c, clause (16), in the case of a
11.29shareholder of a corporation that is an S corporation, an amount equal to one-fifth of the
11.30addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause (16), in the
11.31case of a shareholder of a corporation that is an S corporation, minus the positive value of
11.32any net operating loss under section 172 of the Internal Revenue Code generated for the
11.33tax year of the addition. If the net operating loss exceeds the addition for the tax year, a
11.34subtraction is not allowed under this clause;
11.35    (14) to the extent included in the federal taxable income of a nonresident of
11.36Minnesota, compensation paid to a service member as defined in United States Code, title
12.110, section 101(a)(5), for military service as defined in the Servicemembers Civil Relief
12.2Act, Public Law 108-189, section 101(2);
12.3    (15) international economic development zone income as provided under section
12.4469.325 ;
12.5    (16) to the extent included in federal taxable income, the amount of national service
12.6educational awards received from the National Service Trust under United States Code,
12.7title 42, sections 12601 to 12604, for service in an approved Americorps National Service
12.8program; and
12.9(17) to the extent included in federal taxable income, discharge of indebtedness
12.10income resulting from reacquisition of business indebtedness included in federal taxable
12.11income under section 108(i) of the Internal Revenue Code. This subtraction applies only
12.12to the extent that the income was included in net income in a prior year as a result of the
12.13addition under section 290.01, subdivision 19a, clause (16); and
12.14(18) the amount of the net operating loss allowed under section 290.095, subdivision
12.1511, paragraph (c).
12.16EFFECTIVE DATE.The changes to clauses (10), (11), and (14) are effective the
12.17day following final enactment. Clause (18) is effective retroactively for losses generated
12.18in taxable years beginning after December 31, 2007.

12.19    Sec. 12. Minnesota Statutes 2010, section 290.06, subdivision 2c, is amended to read:
12.20    Subd. 2c. Schedules of rates for individuals, estates, and trusts. (a) The income
12.21taxes imposed by this chapter upon married individuals filing joint returns and surviving
12.22spouses as defined in section 2(a) of the Internal Revenue Code must be computed by
12.23applying to their taxable net income the following schedule of rates:
12.24    (1) On the first $25,680, 5.35 percent;
12.25    (2) On all over $25,680, but not over $102,030, 7.05 percent;
12.26    (3) On all over $102,030, 7.85 percent.
12.27    Married individuals filing separate returns, estates, and trusts must compute their
12.28income tax by applying the above rates to their taxable income, except that the income
12.29brackets will be one-half of the above amounts.
12.30    (b) The income taxes imposed by this chapter upon unmarried individuals must be
12.31computed by applying to taxable net income the following schedule of rates:
12.32    (1) On the first $17,570, 5.35 percent;
12.33    (2) On all over $17,570, but not over $57,710, 7.05 percent;
12.34    (3) On all over $57,710, 7.85 percent.
13.1    (c) The income taxes imposed by this chapter upon unmarried individuals qualifying
13.2as a head of household as defined in section 2(b) of the Internal Revenue Code must be
13.3computed by applying to taxable net income the following schedule of rates:
13.4    (1) On the first $21,630, 5.35 percent;
13.5    (2) On all over $21,630, but not over $86,910, 7.05 percent;
13.6    (3) On all over $86,910, 7.85 percent.
13.7    (d) In lieu of a tax computed according to the rates set forth in this subdivision, the
13.8tax of any individual taxpayer whose taxable net income for the taxable year is less than
13.9an amount determined by the commissioner must be computed in accordance with tables
13.10prepared and issued by the commissioner of revenue based on income brackets of not
13.11more than $100. The amount of tax for each bracket shall be computed at the rates set
13.12forth in this subdivision, provided that the commissioner may disregard a fractional part of
13.13a dollar unless it amounts to 50 cents or more, in which case it may be increased to $1.
13.14    (e) An individual who is not a Minnesota resident for the entire year must compute
13.15the individual's Minnesota income tax as provided in this subdivision. After the
13.16application of the nonrefundable credits provided in this chapter, the tax liability must
13.17then be multiplied by a fraction in which:
13.18    (1) the numerator is the individual's Minnesota source federal adjusted gross income
13.19as defined in section 62 of the Internal Revenue Code and increased by the additions
13.20required under section 290.01, subdivision 19a, clauses (1), (5), (6), (7), (8), (9), (12),
13.21(13), and (16), and (17) to (18), and reduced by the Minnesota assignable portion of
13.22the subtraction for United States government interest under section 290.01, subdivision
13.2319b , clause (1), and the subtractions under section 290.01, subdivision 19b, clauses (8),
13.24(9), (13), (14), (15), and (17), and (18), after applying the allocation and assignability
13.25provisions of section 290.081, clause (a), or 290.17; and
13.26    (2) the denominator is the individual's federal adjusted gross income as defined in
13.27section 62 of the Internal Revenue Code of 1986, increased by the amounts specified in
13.28section 290.01, subdivision 19a, clauses (1), (5), (6), (7), (8), (9), (12), (13), and (16), and
13.29(17) to (18), and reduced by the amounts specified in section 290.01, subdivision 19b,
13.30clauses (1), (8), (9), (13), (14), (15), and (17), and (18).
13.31EFFECTIVE DATE.This section is effective retroactively for losses generated in
13.32taxable years beginning after December 31, 2007.

13.33    Sec. 13. Minnesota Statutes 2010, section 290.091, subdivision 2, is amended to read:
13.34    Subd. 2. Definitions. For purposes of the tax imposed by this section, the following
13.35terms have the meanings given:
14.1    (a) "Alternative minimum taxable income" means the sum of the following for
14.2the taxable year:
14.3    (1) the taxpayer's federal alternative minimum taxable income as defined in section
14.455(b)(2) of the Internal Revenue Code;
14.5    (2) the taxpayer's itemized deductions allowed in computing federal alternative
14.6minimum taxable income, but excluding:
14.7    (i) the charitable contribution deduction under section 170 of the Internal Revenue
14.8Code;
14.9    (ii) the medical expense deduction;
14.10    (iii) the casualty, theft, and disaster loss deduction; and
14.11    (iv) the impairment-related work expenses of a disabled person;
14.12    (3) for depletion allowances computed under section 613A(c) of the Internal
14.13Revenue Code, with respect to each property (as defined in section 614 of the Internal
14.14Revenue Code), to the extent not included in federal alternative minimum taxable income,
14.15the excess of the deduction for depletion allowable under section 611 of the Internal
14.16Revenue Code for the taxable year over the adjusted basis of the property at the end of the
14.17taxable year (determined without regard to the depletion deduction for the taxable year);
14.18    (4) to the extent not included in federal alternative minimum taxable income, the
14.19amount of the tax preference for intangible drilling cost under section 57(a)(2) of the
14.20Internal Revenue Code determined without regard to subparagraph (E);
14.21    (5) to the extent not included in federal alternative minimum taxable income, the
14.22amount of interest income as provided by section 290.01, subdivision 19a, clause (1); and
14.23    (6) the amount of addition required by section 290.01, subdivision 19a, clauses (7)
14.24to (9), (12), (13), and (16), and (17) to (18);
14.25    less the sum of the amounts determined under the following:
14.26    (1) interest income as defined in section 290.01, subdivision 19b, clause (1);
14.27    (2) an overpayment of state income tax as provided by section 290.01, subdivision
14.2819b , clause (2), to the extent included in federal alternative minimum taxable income;
14.29    (3) the amount of investment interest paid or accrued within the taxable year on
14.30indebtedness to the extent that the amount does not exceed net investment income, as
14.31defined in section 163(d)(4) of the Internal Revenue Code. Interest does not include
14.32amounts deducted in computing federal adjusted gross income; and
14.33    (4) amounts subtracted from federal taxable income as provided by section 290.01,
14.34subdivision 19b , clauses (6), (8) to (15), and (17); and
14.35(5) the amount of the net operating loss allowed under section 290.095, subdivision
14.3611, paragraph (c).
15.1    In the case of an estate or trust, alternative minimum taxable income must be
15.2computed as provided in section 59(c) of the Internal Revenue Code.
15.3    (b) "Investment interest" means investment interest as defined in section 163(d)(3)
15.4of the Internal Revenue Code.
15.5    (c) "Net minimum tax" means the minimum tax imposed by this section.
15.6    (d) "Regular tax" means the tax that would be imposed under this chapter (without
15.7regard to this section and section 290.032), reduced by the sum of the nonrefundable
15.8credits allowed under this chapter.
15.9    (e) "Tentative minimum tax" equals 6.4 percent of alternative minimum taxable
15.10income after subtracting the exemption amount determined under subdivision 3.
15.11EFFECTIVE DATE.This section is effective retroactively for losses generated in
15.12taxable years beginning after December 31, 2007.

15.13    Sec. 14. Minnesota Statutes 2010, section 290.0922, subdivision 2, is amended to read:
15.14    Subd. 2. Exemptions. The following entities are exempt from the tax imposed
15.15by this section:
15.16(1) corporations exempt from tax under section 290.05;
15.17(2) real estate investment trusts;
15.18(3) regulated investment companies or a fund thereof; and
15.19(4) entities having a valid election in effect under section 860D(b) of the Internal
15.20Revenue Code;
15.21(5) town and farmers' mutual insurance companies;
15.22(6) cooperatives organized under chapter 308A or 308B that provide housing
15.23exclusively to persons age 55 and over and are classified as homesteads under section
15.24273.124, subdivision 3 ;
15.25(7) an entity a qualified business as defined under section 469.310, subdivision 11,
15.26if for the taxable year all of its property is located in a job opportunity building zone
15.27designated under section 469.314 and all of its payroll is a job opportunity building zone
15.28payroll under section 469.310; and
15.29(8) an entity, if for the taxable year all of its property is located in an international
15.30economic development zone designated under section 469.322, and all of its payroll is
15.31international economic development zone payroll under section 469.321. The exemption
15.32under this clause applies to taxable years beginning during the duration of the international
15.33economic development zone.
15.34Entities not specifically exempted by this subdivision are subject to tax under this
15.35section, notwithstanding section 290.05.
16.1EFFECTIVE DATE.This section is effective the day following final enactment.

16.2    Sec. 15. Minnesota Statutes 2010, section 290.0922, subdivision 3, is amended to read:
16.3    Subd. 3. Definitions. (a) "Minnesota sales or receipts" means the total sales
16.4apportioned to Minnesota pursuant to section 290.191, subdivision 5, the total receipts
16.5attributed to Minnesota pursuant to section 290.191, subdivisions 6 to 8, and/or the
16.6total sales or receipts apportioned or attributed to Minnesota pursuant to any other
16.7apportionment formula applicable to the taxpayer.
16.8(b) "Minnesota property" means total Minnesota tangible property as provided in
16.9section 290.191, subdivisions 9 to 11, any other tangible property located in Minnesota,
16.10but does not include: (1) the property of a qualified business as defined under section
16.11469.310, subdivision 11, that is located in a job opportunity building zone designated
16.12under section 469.314, (2) property of a qualified business located in a biotechnology and
16.13health sciences industry zone designated under section 469.334, or (3) for taxable years
16.14beginning during the duration of the zone, property of a qualified business located in the
16.15international economic development zone designated under section 469.322. Intangible
16.16property shall not be included in Minnesota property for purposes of this section.
16.17Taxpayers who do not utilize tangible property to apportion income shall nevertheless
16.18include Minnesota property for purposes of this section. On a return for a short taxable
16.19year, the amount of Minnesota property owned, as determined under section 290.191,
16.20shall be included in Minnesota property based on a fraction in which the numerator is the
16.21number of days in the short taxable year and the denominator is 365.
16.22(c) "Minnesota payrolls" means total Minnesota payrolls as provided in section
16.23290.191, subdivision 12 , but does not include: (1) the job opportunity building zone
16.24payrolls payroll under section 469.310, subdivision 8, of a qualified business as defined
16.25under section 469.310, subdivision 11, (2) biotechnology and health sciences industry
16.26zone payrolls under section 469.330, subdivision 8, or (3) for taxable years beginning
16.27during the duration of the zone, international economic development zone payrolls under
16.28section 469.321, subdivision 9. Taxpayers who do not utilize payrolls to apportion income
16.29shall nevertheless include Minnesota payrolls for purposes of this section.
16.30EFFECTIVE DATE.This section is effective the day following final enactment.

16.31    Sec. 16. Minnesota Statutes 2010, section 290.095, subdivision 11, is amended to read:
16.32    Subd. 11. Carryback or carryover adjustments. (a) Except as provided in
16.33paragraph (c), for individuals, estates, and trusts the amount of a net operating loss
16.34that may be carried back or carried over shall be the same dollar amount allowable in
17.1the determination of federal taxable income, provided that, notwithstanding any other
17.2provision, estates and trusts must apply the following adjustments to the amount of the net
17.3operating loss that may be carried back or carried over:
17.4    (1) Nonassignable income or losses as required by section 290.17.
17.5    (2) Deductions not allocable to Minnesota under section 290.17.
17.6    (b) The net operating loss carryback or carryover applied as a deduction in the taxable
17.7year to which the net operating loss is carried back or carried over shall be equal to the
17.8net operating loss carryback or carryover applied in the taxable year in arriving at federal
17.9taxable income provided that trusts and estates must apply the following modifications:
17.10    (1) Increase the amount of carryback or carryover applied in the taxable year by
17.11the amount of losses and interest, taxes and other expenses not assignable or allowable
17.12to Minnesota incurred in the taxable year.
17.13    (2) Decrease the amount of carryback or carryover applied in the taxable year by
17.14the amount of income not assignable to Minnesota earned in the taxable year. For estates
17.15and trusts, the net operating loss carryback or carryover to the next consecutive taxable
17.16year shall be the net operating loss carryback or carryover as calculated in clause (b)
17.17less the amount applied in the earlier taxable year(s). No additional net operating loss
17.18carryback or carryover shall be allowed to estates and trusts if the entire amount has been
17.19used to offset Minnesota income in a year earlier than was possible on the federal return.
17.20However, if a net operating loss carryback or carryover was allowed to offset federal
17.21income in a year earlier than was possible on the Minnesota return, an estate or trust
17.22shall still be allowed to offset Minnesota income but only if the loss was assignable to
17.23Minnesota in the year the loss occurred.
17.24(c) This paragraph does not apply to eligible small businesses that make a valid
17.25election to carry back their losses for federal purposes under section 172(b)(1)(H) of the
17.26Internal Revenue Code as amended through March 31, 2009.
17.27(1) A net operating loss of an individual, estate, or trust that is allowed under this
17.28subdivision and for which the taxpayer elects to carry back for more than two years under
17.29section 172(b)(1)(H) of the Internal Revenue Code is a net operating loss carryback to
17.30each of the two taxable years preceding the loss, and unused portions may be carried
17.31forward for 20 taxable years after the loss.
17.32(2) The entire amount of the net operating loss for any taxable year must be carried
17.33to the earliest of the taxable years to which the loss may be carried. The portion of the loss
17.34which may be carried to each of the other taxable years is the excess, if any, of the amount
17.35of the loss over the greater of the taxable net income or alternative minimum taxable
17.36income for each of the taxable years to which the loss may be carried.
18.1EFFECTIVE DATE.This section is effective retroactively for losses generated in
18.2taxable years beginning after December 31, 2007.

18.3    Sec. 17. Minnesota Statutes 2010, section 290.92, subdivision 26, is amended to read:
18.4    Subd. 26. Extension of withholding to certain payments where identifying
18.5number not furnished or inaccurate. (a) If, in the case of any reportable payment,
18.6(1) the payee fails to furnish the payee's Social Security account number to the payor,
18.7(2) the payee is subject to federal backup withholding on the reportable payment under
18.8section 3406 of the Internal Revenue Code, or (3) the commissioner notifies the payor that
18.9the Social Security account number furnished by the payee is incorrect, then the payor
18.10shall deduct and withhold from the payment a tax equal to the amount of the payment
18.11multiplied by the highest rate used in determining the income tax liability of an individual
18.12under section 290.06, subdivision 2c.
18.13    (b)(1) In the case of any failure described in clause (a)(1), clause (a) shall apply to
18.14any reportable payment made by the payor during the period during which the Social
18.15Security account number has not been furnished.
18.16    (2) In any case where there is a notification described in clause (a)(3), clause (a)
18.17shall apply to any reportable payment made by the payor (i) after the close of the 30th
18.18day after the day on which the payor received the notification, and (ii) before the payee
18.19furnishes another Social Security account number.
18.20    (3)(i) Unless the payor elects not to have this subparagraph apply with respect to
18.21the payee, clause (a) shall also apply to any reportable payment made after the close of
18.22the period described in paragraph (1) or (2) (as the case may be) and before the 30th
18.23day after the close of the period.
18.24    (ii) If the payor elects the application of this subparagraph with respect to the payee,
18.25clause (a) shall also apply to any reportable payment made during the 30-day period
18.26described in paragraph (2).
18.27    (iii) The payor may elect a period shorter than the grace period set forth in
18.28subparagraph (i) or (ii) as the case may be.
18.29    (c) The provisions of section 3406 of the Internal Revenue Code shall apply and
18.30shall govern when withholding shall be required and the definition of terms. The term
18.31"reportable payment" shall include only those payments for personal services, including
18.32payments subject to withholding under subdivision 31. No tax shall be deducted or
18.33withheld under this subdivision with respect to any amount for which withholding is
18.34otherwise required under this section. For purposes of this section, payments which are
18.35subject to withholding under this subdivision shall be treated as if they were wages paid
19.1by an employer to an employee and amounts deducted and withheld under this subdivision
19.2shall be treated as if deducted and withheld under subdivision 2a.
19.3    (d) Whenever the commissioner notifies a payor under this subdivision that the
19.4Social Security account number furnished by any payee is incorrect, the commissioner
19.5shall at the same time furnish a copy of the notice to the payor, and the payor shall
19.6promptly furnish the copy to the payee. If the commissioner notifies a payor under this
19.7subdivision that the Social Security account number furnished by any payee is incorrect
19.8and the payee subsequently furnishes another Social Security account number to the
19.9payor, the payor shall promptly notify the commissioner of the other Social Security
19.10account number furnished.
19.11EFFECTIVE DATE.This section is effective the day following final enactment.


19.14    Section 1. Minnesota Statutes 2010, section 289A.18, subdivision 3, is amended to
19.15read:
19.16    Subd. 3. Estate tax returns. An estate tax return must be filed with the
19.17commissioner within nine months after the decedent's death. Except in the case of the
19.18estate of a decedent dying after December 31, 2009, and before December 17, 2010,
19.19then an estate tax return must be filed with the commissioner within nine months after
19.20the decedent's death; within the time provided by Minnesota Statutes, section 289A.19,
19.21subdivision 4; or before September 20, 2011; whichever is later.
19.22EFFECTIVE DATE.This section is effective for estates of decedents dying after
19.23December 31, 2009.

19.24    Sec. 2. Minnesota Statutes 2010, section 289A.35, is amended to read:
19.25289A.35 ASSESSMENTS ON RETURNS.
19.26(a) The commissioner may audit and adjust the taxpayer's computation of federal
19.27taxable income, items of federal tax preferences, or federal credit amounts to make them
19.28conform with the provisions of chapter 290 or section 298.01. If a return has been filed,
19.29the commissioner shall enter the liability reported on the return and may make any audit
19.30or investigation that is considered necessary.
19.31(b) The commissioner may audit and adjust the taxpayer's computation of tax under
19.32chapter 291. In the case of a return filed pursuant to section 289A.10, the commissioner
19.33shall notify the estate no later than six months after the filing date, as provided by section
20.1289A.38, subdivision 2, whether the return is under examination or the return has been
20.2processed as filed.
20.3EFFECTIVE DATE.This section is effective for estates of decedents dying after
20.4December 31, 2010.

20.5    Sec. 3. Minnesota Statutes 2010, section 291.03, subdivision 1b, is amended to read:
20.6    Subd. 1b. Qualified terminable interest property. For estates of decedents dying
20.7after December 31, 2009, and before January 1, 2011, if no federal estate tax return is
20.8filed a federal election under section 301(c) of the Tax Relief, Unemployment Insurance
20.9Reauthorization, and Job Creation Act of 2010, Public Law 111-312, is made, the executor
20.10may make a qualified terminable interest property election, as defined in section 2056(b)(7)
20.11of the Internal Revenue Code, for purposes of computing the tax under this chapter. The
20.12election may not reduce the taxable estate under this chapter below $3,500,000. The
20.13election must be made on the tax return under this chapter and is irrevocable. All tax under
20.14this chapter must be determined using the qualified terminable interest property election
20.15made on the Minnesota return. For purposes of applying sections 2044 and 2207A of
20.16the Internal Revenue Code when computing the tax under this chapter for the estate of
20.17the decedent's surviving spouse, regardless of the date of death of the surviving spouse,
20.18amounts for which a qualified terminable interest property election has been made under
20.19this section must be treated as though a valid federal qualified terminable interest property
20.20election under section 2056(b)(7) of the Internal Revenue Code has been made.
20.21EFFECTIVE DATE.This section is effective for estates of decedents dying after
20.22December 31, 2009.


20.25    Section 1. Minnesota Statutes 2010, section 270.87, is amended to read:
20.26270.87 CERTIFICATION TO COUNTY ASSESSORS.
20.27After making an annual determination of the equalized fair market value of the
20.28operating property of each company in each of the respective counties, and in the taxing
20.29districts therein, the commissioner shall certify the equalized fair market value to the
20.30county assessor on or before June 30. The equalized fair market value of the operating
20.31property of the railroad company in the county and the taxing districts therein is the value
20.32on which taxes must be levied and collected in the same manner as on the commercial and
20.33industrial property of such county and the taxing districts therein. If the commissioner
21.1determines that the equalized fair market value certified on or before June 30 is in error,
21.2the commissioner may issue a corrected certification on or before August 31.
21.3EFFECTIVE DATE.This section is effective for taxes payable in 2012 and
21.4thereafter.

21.5    Sec. 2. Minnesota Statutes 2010, section 272.029, is amended by adding a subdivision
21.6to read:
21.7    Subd. 4a. Correction of errors. If the commissioner of revenue determines that
21.8the amount of production tax has been erroneously calculated, the commissioner may
21.9correct the error. The commissioner must notify the owner of the wind energy conversion
21.10system of the correction and the amount of tax due to each county and must certify the
21.11correction to the county auditor of each county in which the system is located on or before
21.12April 1 of the current year.
21.13EFFECTIVE DATE.This section is effective beginning with certifications due
21.14February 28, 2012.

21.15    Sec. 3. Minnesota Statutes 2010, section 273.1231, subdivision 4, is amended to read:
21.16    Subd. 4. Homestead property. "Homestead property" means a homestead dwelling
21.17that is classified as class 1a, 1b, 1c, or 2a property or a manufactured home or sectional
21.18home used as a homestead and taxed pursuant to section 273.125, subdivision 8, paragraph
21.19(b), (c), or (d).
21.20EFFECTIVE DATE.This section is effective the day following final enactment.

21.21    Sec. 4. Minnesota Statutes 2010, section 273.124, subdivision 1, is amended to read:
21.22    Subdivision 1. General rule. (a) Residential real estate that is occupied and used
21.23for the purposes of a homestead by its owner, who must be a Minnesota resident, is
21.24a residential homestead.
21.25    Agricultural land, as defined in section 273.13, subdivision 23, that is occupied and
21.26used as a homestead by its owner, who must be a Minnesota resident, is an agricultural
21.27homestead.
21.28    Dates for establishment of a homestead and homestead treatment provided to
21.29particular types of property are as provided in this section.
21.30    Property held by a trustee under a trust is eligible for homestead classification if the
21.31requirements under this chapter are satisfied.
22.1    The assessor shall require proof, as provided in subdivision 13, of the facts upon
22.2which classification as a homestead may be determined. Notwithstanding any other law,
22.3the assessor may at any time require a homestead application to be filed in order to verify
22.4that any property classified as a homestead continues to be eligible for homestead status.
22.5Notwithstanding any other law to the contrary, the Department of Revenue may, upon
22.6request from an assessor, verify whether an individual who is requesting or receiving
22.7homestead classification has filed a Minnesota income tax return as a resident for the most
22.8recent taxable year for which the information is available.
22.9    When there is a name change or a transfer of homestead property, the assessor may
22.10reclassify the property in the next assessment unless a homestead application is filed to
22.11verify that the property continues to qualify for homestead classification.
22.12    (b) For purposes of this section, homestead property shall include property which
22.13is used for purposes of the homestead but is separated from the homestead by a road,
22.14street, lot, waterway, or other similar intervening property. The term "used for purposes
22.15of the homestead" shall include but not be limited to uses for gardens, garages, or other
22.16outbuildings commonly associated with a homestead, but shall not include vacant land
22.17held primarily for future development. In order to receive homestead treatment for
22.18the noncontiguous property, the owner must use the property for the purposes of the
22.19homestead, and must apply to the assessor, both by the deadlines given in subdivision
22.209. After initial qualification for the homestead treatment, additional applications for
22.21subsequent years are not required.
22.22    (c) Residential real estate that is occupied and used for purposes of a homestead by a
22.23relative of the owner is a homestead but only to the extent of the homestead treatment
22.24that would be provided if the related owner occupied the property. For purposes of this
22.25paragraph and paragraph (g), "relative" means a parent, stepparent, child, stepchild,
22.26grandparent, grandchild, brother, sister, uncle, aunt, nephew, or niece. This relationship
22.27may be by blood or marriage. Property that has been classified as seasonal residential
22.28recreational property at any time during which it has been owned by the current owner or
22.29spouse of the current owner will not be reclassified as a homestead unless it is occupied as
22.30a homestead by the owner; this prohibition also applies to property that, in the absence of
22.31this paragraph, would have been classified as seasonal residential recreational property at
22.32the time when the residence was constructed. Neither the related occupant nor the owner
22.33of the property may claim a property tax refund under chapter 290A for a homestead
22.34occupied by a relative. In the case of a residence located on agricultural land, only the
22.35house, garage, and immediately surrounding one acre of land shall be classified as a
22.36homestead under this paragraph, except as provided in paragraph (d).
23.1    (d) Agricultural property that is occupied and used for purposes of a homestead by
23.2a relative of the owner, is a homestead, only to the extent of the homestead treatment
23.3that would be provided if the related owner occupied the property, and only if all of the
23.4following criteria are met:
23.5    (1) the relative who is occupying the agricultural property is a son, daughter, brother,
23.6sister, grandson, granddaughter, father, or mother grandchild, child, sibling, or parent of
23.7the owner of the agricultural property or a son, daughter, brother, sister, grandson, or
23.8granddaughter of the spouse of the owner of the agricultural property;
23.9    (2) the owner of the agricultural property must be a Minnesota resident;
23.10    (3) the owner of the agricultural property must not receive homestead treatment on
23.11any other agricultural property in Minnesota; and
23.12    (4) the owner of the agricultural property is limited to only one agricultural
23.13homestead per family under this paragraph.
23.14    Neither the related occupant nor the owner of the property may claim a property
23.15tax refund under chapter 290A for a homestead occupied by a relative qualifying under
23.16this paragraph. For purposes of this paragraph, "agricultural property" means the house,
23.17garage, other farm buildings and structures, and agricultural land.
23.18    Application must be made to the assessor by the owner of the agricultural property to
23.19receive homestead benefits under this paragraph. The assessor may require the necessary
23.20proof that the requirements under this paragraph have been met.
23.21    (e) In the case of property owned by a property owner who is married, the assessor
23.22must not deny homestead treatment in whole or in part if only one of the spouses occupies
23.23the property and the other spouse is absent due to: (1) marriage dissolution proceedings,
23.24(2) legal separation, (3) employment or self-employment in another location, or (4) other
23.25personal circumstances causing the spouses to live separately, not including an intent to
23.26obtain two homestead classifications for property tax purposes. To qualify under clause
23.27(3), the spouse's place of employment or self-employment must be at least 50 miles distant
23.28from the other spouse's place of employment, and the homesteads must be at least 50 miles
23.29distant from each other. Homestead treatment, in whole or in part, shall not be denied to
23.30the owner's spouse who previously occupied the residence with the owner if the absence
23.31of the owner is due to one of the exceptions provided in this paragraph.
23.32    (f) The assessor must not deny homestead treatment in whole or in part if:
23.33    (1) in the case of a property owner who is not married, the owner is absent due to
23.34residence in a nursing home, boarding care facility, or an elderly assisted living facility
23.35property as defined in section 273.13, subdivision 25a, and the property is not otherwise
23.36occupied; or
24.1    (2) in the case of a property owner who is married, the owner or the owner's spouse
24.2or both are absent due to residence in a nursing home, boarding care facility, or an elderly
24.3assisted living facility property as defined in section 273.13, subdivision 25a, and the
24.4property is not occupied or is occupied only by the owner's spouse.
24.5    (g) If an individual is purchasing property with the intent of claiming it as a
24.6homestead and is required by the terms of the financing agreement to have a relative
24.7shown on the deed as a co-owner, the assessor shall allow a full homestead classification.
24.8This provision only applies to first-time purchasers, whether married or single, or to a
24.9person who had previously been married and is purchasing as a single individual for the
24.10first time. The application for homestead benefits must be on a form prescribed by the
24.11commissioner and must contain the data necessary for the assessor to determine if full
24.12homestead benefits are warranted.
24.13    (h) If residential or agricultural real estate is occupied and used for purposes of a
24.14homestead by a child of a deceased owner and the property is subject to jurisdiction of
24.15probate court, the child shall receive relative homestead classification under paragraph (c)
24.16or (d) to the same extent they would be entitled to it if the owner was still living, until
24.17the probate is completed. For purposes of this paragraph, "child" includes a relationship
24.18by blood or by marriage.
24.19    (i) If a single-family home, duplex, or triplex classified as either residential
24.20homestead or agricultural homestead is also used to provide licensed child care, the
24.21portion of the property used for licensed child care must be classified as a part of the
24.22homestead property.
24.23EFFECTIVE DATE.This section is effective for taxes payable in 2012 and
24.24thereafter.

24.25    Sec. 5. Minnesota Statutes 2010, section 273.124, subdivision 8, is amended to read:
24.26    Subd. 8. Homestead owned by or leased to family farm corporation, joint farm
24.27venture, limited liability company, or partnership. (a) Each family farm corporation;
24.28each joint family farm venture; and each limited liability company or partnership which
24.29operates a family farm; is entitled to class 1b under section 273.13, subdivision 22,
24.30paragraph (b), or class 2a assessment for one homestead occupied by a shareholder,
24.31member, or partner thereof who is residing on the land, and actively engaged in farming of
24.32the land owned by the family farm corporation, joint family farm venture, limited liability
24.33company, or partnership. Homestead treatment applies even if legal title to the property is
24.34in the name of the family farm corporation, joint family farm venture, limited liability
24.35company, or partnership, and not in the name of the person residing on it.
25.1"Family farm corporation," "family farm," and "partnership operating a family
25.2farm" have the meanings given in section 500.24, except that the number of allowable
25.3shareholders, members, or partners under this subdivision shall not exceed 12. "Limited
25.4liability company" has the meaning contained in sections 322B.03, subdivision 28, and
25.5500.24, subdivision 2 , paragraphs (l) and (m). "Joint family farm venture" means a
25.6cooperative agreement among two or more farm enterprises authorized to operate a family
25.7farm under section 500.24.
25.8(b) In addition to property specified in paragraph (a), any other residences owned
25.9by family farm corporations, joint family farm ventures, limited liability companies,
25.10or partnerships described in paragraph (a) which are located on agricultural land and
25.11occupied as homesteads by its shareholders, members, or partners who are actively
25.12engaged in farming on behalf of that corporation, joint farm venture, limited liability
25.13company, or partnership must also be assessed as class 2a property or as class 1b property
25.14under section 273.13.
25.15(c) Agricultural property that is owned by a member, partner, or shareholder of a
25.16family farm corporation or joint family farm venture, limited liability company operating
25.17a family farm, or by a partnership operating a family farm and leased to the family farm
25.18corporation, limited liability company, partnership, or joint farm venture, as defined in
25.19paragraph (a), is eligible for classification as class 1b or class 2a under section 273.13, if
25.20the owner is actually residing on the property, and is actually engaged in farming the land
25.21on behalf of that corporation, joint farm venture, limited liability company, or partnership.
25.22This paragraph applies without regard to any legal possession rights of the family farm
25.23corporation, joint family farm venture, limited liability company, or partnership under
25.24the lease.
25.25(d) Nonhomestead agricultural property that (1) is owned by a family farm
25.26corporation, joint farm venture, limited liability company, or partnership; and (2)
25.27is contiguous to a class 2a homestead under section 273.13, subdivision 23, or if
25.28noncontiguous, is located in the same township or city, or not farther than four townships
25.29or cities, or combination thereof from a class 2a homestead, and the class 2a homestead is
25.30owned by one of the shareholders, members, or partners agricultural land that is owned,
25.31and used for the purposes of a homestead by an individual who is a shareholder, member,
25.32or partner of the corporation, venture, company, or partnership; is entitled to receive the
25.33first tier homestead class rate up to the first tier maximum market value on any remaining
25.34market value not received on in the first homestead class tier that is in excess of the
25.35market value of the shareholder's, member's, or partner's homestead class 2a 2 agricultural
25.36homestead property., if the owner must notify , or someone acting on the owner's behalf
26.1notifies the county assessor by July 1 that a portion of the market value the property may
26.2be eligible under this subdivision may be eligible for homestead classification paragraph
26.3for the current assessment year, for taxes payable in the following year. As used in this
26.4paragraph, "agricultural property" means property classified as 2a under section 273.13,
26.5along with any contiguous property classified as 2b under section 273.13, if the contiguous
26.62a and 2b properties are under the same ownership.
26.7EFFECTIVE DATE.This section is effective retroactively for taxes payable in
26.82011 and thereafter.

26.9    Sec. 6. Minnesota Statutes 2010, section 273.124, subdivision 14, is amended to read:
26.10    Subd. 14. Agricultural homesteads; special provisions. (a) Real estate of less than
26.11ten acres that is the homestead of its owner must be classified as class 2a under section
26.12273.13, subdivision 23 , paragraph (a), if:
26.13    (1) the parcel on which the house is located is contiguous on at least two sides to (i)
26.14agricultural land, (ii) land owned or administered by the United States Fish and Wildlife
26.15Service, or (iii) land administered by the Department of Natural Resources on which in
26.16lieu taxes are paid under sections 477A.11 to 477A.14;
26.17    (2) its owner also owns a noncontiguous parcel of agricultural land that is at least
26.1820 acres;
26.19    (3) the noncontiguous land is located not farther than four townships or cities, or a
26.20combination of townships or cities from the homestead; and
26.21    (4) the agricultural use value of the noncontiguous land and farm buildings is equal
26.22to at least 50 percent of the market value of the house, garage, and one acre of land.
26.23    Homesteads initially classified as class 2a under the provisions of this paragraph shall
26.24remain classified as class 2a, irrespective of subsequent changes in the use of adjoining
26.25properties, as long as the homestead remains under the same ownership, the owner owns a
26.26noncontiguous parcel of agricultural land that is at least 20 acres, and the agricultural use
26.27value qualifies under clause (4). Homestead classification under this paragraph is limited
26.28to property that qualified under this paragraph for the 1998 assessment.
26.29    (b)(i) Agricultural property shall be classified as the owner's homestead, to the same
26.30extent as other agricultural homestead property, if all of the following criteria are met:
26.31    (1) the agricultural property consists of at least 40 acres including undivided
26.32government lots and correctional 40's;
26.33    (2) the owner, the owner's spouse, the son or daughter of the owner or owner's
26.34spouse, the brother or sister of the owner or owner's spouse, or the grandson or
26.35granddaughter or a grandchild, child, sibling, or parent of the owner or of the owner's
27.1spouse, is actively farming the agricultural property, either on the person's own behalf
27.2as an individual or on behalf of a partnership operating a family farm, family farm
27.3corporation, joint family farm venture, or limited liability company of which the person is
27.4a partner, shareholder, or member;
27.5    (3) both the owner of the agricultural property and the person who is actively
27.6farming the agricultural property under clause (2), are Minnesota residents;
27.7    (4) neither the owner nor the spouse of the owner claims another agricultural
27.8homestead in Minnesota; and
27.9    (5) neither the owner nor the person actively farming the agricultural property lives
27.10farther than four townships or cities, or a combination of four townships or cities, from the
27.11agricultural property, except that if the owner or the owner's spouse is required to live in
27.12employer-provided housing, the owner or owner's spouse, whichever is actively farming
27.13the agricultural property, may live more than four townships or cities, or combination of
27.14four townships or cities from the agricultural property.
27.15    The relationship under this paragraph may be either by blood or marriage.
27.16    (ii) Real Agricultural property held by a trustee under a trust is eligible for
27.17agricultural homestead classification under this paragraph if the qualifications in clause (i)
27.18are met, except that "owner" means the grantor of the trust.
27.19    (iii) Property containing the residence of an owner who owns qualified property
27.20under clause (i) shall be classified as part of the owner's agricultural homestead, if that
27.21property is also used for noncommercial storage or drying of agricultural crops.
27.22(iv) As used in this paragraph, "agricultural property" means class 2a property and
27.23any class 2b property that is contiguous to and under the same ownership as the class 2a
27.24property.
27.25    (c) Noncontiguous land shall be included as part of a homestead under section
27.26273.13, subdivision 23 , paragraph (a), only if the homestead is classified as class 2a
27.27and the detached land is located in the same township or city, or not farther than four
27.28townships or cities or combination thereof from the homestead. Any taxpayer of these
27.29noncontiguous lands must notify the county assessor that the noncontiguous land is part of
27.30the taxpayer's homestead, and, if the homestead is located in another county, the taxpayer
27.31must also notify the assessor of the other county.
27.32    (d) Agricultural land used for purposes of a homestead and actively farmed by a
27.33person holding a vested remainder interest in it must be classified as a homestead under
27.34section 273.13, subdivision 23, paragraph (a). If agricultural land is classified class 2a,
27.35any other dwellings on the land used for purposes of a homestead by persons holding
27.36vested remainder interests who are actively engaged in farming the property, and up to
28.1one acre of the land surrounding each homestead and reasonably necessary for the use of
28.2the dwelling as a home, must also be assessed class 2a.
28.3    (e) Agricultural land and buildings that were class 2a homestead property under
28.4section 273.13, subdivision 23, paragraph (a), for the 1997 assessment shall remain
28.5classified as agricultural homesteads for subsequent assessments if:
28.6    (1) the property owner abandoned the homestead dwelling located on the agricultural
28.7homestead as a result of the April 1997 floods;
28.8    (2) the property is located in the county of Polk, Clay, Kittson, Marshall, Norman,
28.9or Wilkin;
28.10    (3) the agricultural land and buildings remain under the same ownership for the
28.11current assessment year as existed for the 1997 assessment year and continue to be used
28.12for agricultural purposes;
28.13    (4) the dwelling occupied by the owner is located in Minnesota and is within 30
28.14miles of one of the parcels of agricultural land that is owned by the taxpayer; and
28.15    (5) the owner notifies the county assessor that the relocation was due to the 1997
28.16floods, and the owner furnishes the assessor any information deemed necessary by the
28.17assessor in verifying the change in dwelling. Further notifications to the assessor are not
28.18required if the property continues to meet all the requirements in this paragraph and any
28.19dwellings on the agricultural land remain uninhabited.
28.20    (f) Agricultural land and buildings that were class 2a homestead property under
28.21section 273.13, subdivision 23, paragraph (a), for the 1998 assessment shall remain
28.22classified agricultural homesteads for subsequent assessments if:
28.23    (1) the property owner abandoned the homestead dwelling located on the agricultural
28.24homestead as a result of damage caused by a March 29, 1998, tornado;
28.25    (2) the property is located in the county of Blue Earth, Brown, Cottonwood,
28.26LeSueur, Nicollet, Nobles, or Rice;
28.27    (3) the agricultural land and buildings remain under the same ownership for the
28.28current assessment year as existed for the 1998 assessment year;
28.29    (4) the dwelling occupied by the owner is located in this state and is within 50 miles
28.30of one of the parcels of agricultural land that is owned by the taxpayer; and
28.31    (5) the owner notifies the county assessor that the relocation was due to a March 29,
28.321998, tornado, and the owner furnishes the assessor any information deemed necessary by
28.33the assessor in verifying the change in homestead dwelling. For taxes payable in 1999, the
28.34owner must notify the assessor by December 1, 1998. Further notifications to the assessor
28.35are not required if the property continues to meet all the requirements in this paragraph
28.36and any dwellings on the agricultural land remain uninhabited.
29.1    (g) Agricultural property of a family farm corporation, joint family farm venture,
29.2family farm limited liability company, or partnership operating a family farm as described
29.3under subdivision 8 shall be classified homestead, to the same extent as other agricultural
29.4homestead property, if all of the following criteria are met:
29.5    (1) the property consists of at least 40 acres including undivided government lots
29.6and correctional 40's;
29.7    (2) a shareholder, member, or partner of that entity is actively farming the
29.8agricultural property;
29.9    (3) that shareholder, member, or partner who is actively farming the agricultural
29.10property is a Minnesota resident;
29.11    (4) neither that shareholder, member, or partner, nor the spouse of that shareholder,
29.12member, or partner claims another agricultural homestead in Minnesota; and
29.13    (5) that shareholder, member, or partner does not live farther than four townships or
29.14cities, or a combination of four townships or cities, from the agricultural property.
29.15    Homestead treatment applies under this paragraph for property leased to a family
29.16farm corporation, joint farm venture, limited liability company, or partnership operating a
29.17family farm if legal title to the property is in the name of an individual who is a member,
29.18shareholder, or partner in the entity.
29.19    (h) To be eligible for the special agricultural homestead under this subdivision, an
29.20initial full application must be submitted to the county assessor where the property is
29.21located. Owners and the persons who are actively farming the property shall be required
29.22to complete only a one-page abbreviated version of the application in each subsequent
29.23year provided that none of the following items have changed since the initial application:
29.24    (1) the day-to-day operation, administration, and financial risks remain the same;
29.25    (2) the owners and the persons actively farming the property continue to live within
29.26the four townships or city criteria and are Minnesota residents;
29.27    (3) the same operator of the agricultural property is listed with the Farm Service
29.28Agency;
29.29    (4) a Schedule F or equivalent income tax form was filed for the most recent year;
29.30    (5) the property's acreage is unchanged; and
29.31    (6) none of the property's acres have been enrolled in a federal or state farm program
29.32since the initial application.
29.33    The owners and any persons who are actively farming the property must include
29.34the appropriate Social Security numbers, and sign and date the application. If any of the
29.35specified information has changed since the full application was filed, the owner must
29.36notify the assessor, and must complete a new application to determine if the property
30.1continues to qualify for the special agricultural homestead. The commissioner of revenue
30.2shall prepare a standard reapplication form for use by the assessors.
30.3    (i) Agricultural land and buildings that were class 2a homestead property under
30.4section 273.13, subdivision 23, paragraph (a), for the 2007 assessment shall remain
30.5classified agricultural homesteads for subsequent assessments if:
30.6    (1) the property owner abandoned the homestead dwelling located on the agricultural
30.7homestead as a result of damage caused by the August 2007 floods;
30.8    (2) the property is located in the county of Dodge, Fillmore, Houston, Olmsted,
30.9Steele, Wabasha, or Winona;
30.10    (3) the agricultural land and buildings remain under the same ownership for the
30.11current assessment year as existed for the 2007 assessment year;
30.12    (4) the dwelling occupied by the owner is located in this state and is within 50 miles
30.13of one of the parcels of agricultural land that is owned by the taxpayer; and
30.14    (5) the owner notifies the county assessor that the relocation was due to the August
30.152007 floods, and the owner furnishes the assessor any information deemed necessary by
30.16the assessor in verifying the change in homestead dwelling. For taxes payable in 2009, the
30.17owner must notify the assessor by December 1, 2008. Further notifications to the assessor
30.18are not required if the property continues to meet all the requirements in this paragraph
30.19and any dwellings on the agricultural land remain uninhabited.
30.20    (j) Agricultural land and buildings that were class 2a homestead property under
30.21section 273.13, subdivision 23, paragraph (a), for the 2008 assessment shall remain
30.22classified as agricultural homesteads for subsequent assessments if:
30.23    (1) the property owner abandoned the homestead dwelling located on the agricultural
30.24homestead as a result of the March 2009 floods;
30.25    (2) the property is located in the county of Marshall;
30.26    (3) the agricultural land and buildings remain under the same ownership for the
30.27current assessment year as existed for the 2008 assessment year and continue to be used
30.28for agricultural purposes;
30.29    (4) the dwelling occupied by the owner is located in Minnesota and is within 50
30.30miles of one of the parcels of agricultural land that is owned by the taxpayer; and
30.31    (5) the owner notifies the county assessor that the relocation was due to the 2009
30.32floods, and the owner furnishes the assessor any information deemed necessary by the
30.33assessor in verifying the change in dwelling. Further notifications to the assessor are not
30.34required if the property continues to meet all the requirements in this paragraph and any
30.35dwellings on the agricultural land remain uninhabited.
31.1EFFECTIVE DATE.This section is effective the day following final enactment
31.2except that the change in paragraph (b), clause (i), item (2), is effective for taxes payable
31.3in 2012 and thereafter.

31.4    Sec. 7. Minnesota Statutes 2010, section 273.13, subdivision 22, is amended to read:
31.5    Subd. 22. Class 1. (a) Except as provided in subdivision 23 and in paragraphs (b)
31.6and (c), real estate which is residential and used for homestead purposes is class 1a. In the
31.7case of a duplex or triplex in which one of the units is used for homestead purposes, the
31.8entire property is deemed to be used for homestead purposes. The market value of class 1a
31.9property must be determined based upon the value of the house, garage, and land.
31.10    The first $500,000 of market value of class 1a property has a net class rate of
31.11one percent of its market value; and the market value of class 1a property that exceeds
31.12$500,000 has a class rate of 1.25 percent of its market value.
31.13    (b) Class 1b property includes homestead real estate or homestead manufactured
31.14homes used for the purposes of a homestead by:
31.15    (1) any person who is blind as defined in section 256D.35, or the blind person and
31.16the blind person's spouse;
31.17    (2) any person who is permanently and totally disabled or by the disabled person and
31.18the disabled person's spouse; or
31.19    (3) the surviving spouse of a permanently and totally disabled veteran homesteading
31.20a property classified under this paragraph for taxes payable in 2008.
31.21    Property is classified and assessed under clause (2) only if the government agency or
31.22income-providing source certifies, upon the request of the homestead occupant, that the
31.23homestead occupant satisfies the disability requirements of this paragraph, and that the
31.24property is not eligible for the valuation exclusion under subdivision 34.
31.25    Property is classified and assessed under paragraph (b) only if the commissioner
31.26of revenue or the county assessor certifies that the homestead occupant satisfies the
31.27requirements of this paragraph.
31.28    Permanently and totally disabled for the purpose of this subdivision means a
31.29condition which is permanent in nature and totally incapacitates the person from working
31.30at an occupation which brings the person an income. The first $50,000 market value of
31.31class 1b property has a net class rate of .45 percent of its market value. The remaining
31.32market value of class 1b property has a class rate using the rates for class 1a or class 2a
31.33property, whichever is appropriate, of similar market value.
31.34    (c) Class 1c property is commercial use real and personal property that abuts public
31.35water as defined in section 103G.005, subdivision 15, and is devoted to temporary and
32.1seasonal residential occupancy for recreational purposes but not devoted to commercial
32.2purposes for more than 250 days in the year preceding the year of assessment, and that
32.3includes a portion used as a homestead by the owner, which includes a dwelling occupied
32.4as a homestead by a shareholder of a corporation that owns the resort, a partner in a
32.5partnership that owns the resort, or a member of a limited liability company that owns
32.6the resort even if the title to the homestead is held by the corporation, partnership, or
32.7limited liability company. For purposes of this paragraph, property is devoted to a
32.8commercial purpose on a specific day if any portion of the property, excluding the portion
32.9used exclusively as a homestead, is used for residential occupancy and a fee is charged
32.10for residential occupancy. Class 1c property must contain three or more rental units. A
32.11"rental unit" is defined as a cabin, condominium, townhouse, sleeping room, or individual
32.12camping site equipped with water and electrical hookups for recreational vehicles. Class
32.131c property must provide recreational activities such as the rental of ice fishing houses,
32.14boats and motors, snowmobiles, downhill or cross-country ski equipment; provide marina
32.15services, launch services, or guide services; or sell bait and fishing tackle. Any unit in
32.16which the right to use the property is transferred to an individual or entity by deeded
32.17interest, or the sale of shares or stock, no longer qualifies for class 1c even though it may
32.18remain available for rent. A camping pad offered for rent by a property that otherwise
32.19qualifies for class 1c is also class 1c, regardless of the term of the rental agreement, as long
32.20as the use of the camping pad does not exceed 250 days. If an owner of property that had
32.21been classified as class 1c ceases to use that property as a homestead but retains ownership
32.22of that property and continues to operate it as a resort, and begins to occupy a second
32.23property that is If the same owner owns two separate parcels that are located in the same
32.24township as the original class 1c property, and one of those properties is classified as a
32.25class 1c property and the other would be eligible to be classified as a class 1c property if it
32.26was used as the homestead of the owner, both properties will be assessed as a single class
32.271c property, provided that the second property would separately qualify to be assessed
32.28as class 1c property; for purposes of this sentence, properties are deemed to be owned
32.29by the same owner if each of them is owned by a limited liability company, and both
32.30limited liability companies have the same membership. The portion of the property used
32.31as a homestead is class 1a property under paragraph (a). The remainder of the property is
32.32classified as follows: the first $600,000 of market value is tier I, the next $1,700,000 of
32.33market value is tier II, and any remaining market value is tier III. The class rates for class
32.341c are: tier I, 0.50 percent; tier II, 1.0 percent; and tier III, 1.25 percent. Owners of real and
32.35personal property devoted to temporary and seasonal residential occupancy for recreation
32.36purposes in which all or a portion of the property was devoted to commercial purposes for
33.1not more than 250 days in the year preceding the year of assessment desiring classification
33.2as class 1c, must submit a declaration to the assessor designating the cabins or units
33.3occupied for 250 days or less in the year preceding the year of assessment by January 15 of
33.4the assessment year. Those cabins or units and a proportionate share of the land on which
33.5they are located must be designated as class 1c as otherwise provided. The remainder of
33.6the cabins or units and a proportionate share of the land on which they are located must be
33.7designated as class 3a commercial. The owner of property desiring designation as class
33.81c property must provide guest registers or other records demonstrating that the units for
33.9which class 1c designation is sought were not occupied for more than 250 days in the
33.10year preceding the assessment if so requested. The portion of a property operated as a
33.11(1) restaurant, (2) bar, (3) gift shop, (4) conference center or meeting room, and (5) other
33.12nonresidential facility operated on a commercial basis not directly related to temporary
33.13and seasonal residential occupancy for recreation purposes does not qualify for class 1c.
33.14    (d) Class 1d property includes structures that meet all of the following criteria:
33.15    (1) the structure is located on property that is classified as agricultural property under
33.16section 273.13, subdivision 23;
33.17    (2) the structure is occupied exclusively by seasonal farm workers during the time
33.18when they work on that farm, and the occupants are not charged rent for the privilege of
33.19occupying the property, provided that use of the structure for storage of farm equipment
33.20and produce does not disqualify the property from classification under this paragraph;
33.21    (3) the structure meets all applicable health and safety requirements for the
33.22appropriate season; and
33.23    (4) the structure is not salable as residential property because it does not comply
33.24with local ordinances relating to location in relation to streets or roads.
33.25    The market value of class 1d property has the same class rates as class 1a property
33.26under paragraph (a).
33.27EFFECTIVE DATE.This section is effective for taxes levied in 2011, payable
33.28in 2012, and thereafter.

33.29    Sec. 8. Minnesota Statutes 2010, section 273.13, subdivision 23, is amended to read:
33.30    Subd. 23. Class 2. (a) An agricultural homestead consists of class 2a agricultural
33.31land that is homesteaded, along with any class 2b rural vacant land that is contiguous to
33.32the class 2a land under the same ownership. The market value of the house and garage
33.33and immediately surrounding one acre of land has the same class rates as class 1a or 1b
33.34property under subdivision 22. The value of the remaining land including improvements
33.35up to the first tier valuation limit of agricultural homestead property has a net class rate
34.1of 0.5 percent of market value. The remaining property over the first tier has a class rate
34.2of one percent of market value. For purposes of this subdivision, the "first tier valuation
34.3limit of agricultural homestead property" and "first tier" means the limit certified under
34.4section 273.11, subdivision 23.
34.5    (b) Class 2a agricultural land consists of parcels of property, or portions thereof, that
34.6are agricultural land and buildings. Class 2a property has a net class rate of one percent of
34.7market value, unless it is part of an agricultural homestead under paragraph (a). Class
34.82a property must also include any property that would otherwise be classified as 2b,
34.9but is interspersed with class 2a property, including but not limited to sloughs, wooded
34.10wind shelters, acreage abutting ditches, ravines, rock piles, land subject to a setback
34.11requirement, and other similar land that is impractical for the assessor to value separately
34.12from the rest of the property or that is unlikely to be able to be sold separately from
34.13the rest of the property.
34.14    An assessor may classify the part of a parcel described in this subdivision that is used
34.15for agricultural purposes as class 2a and the remainder in the class appropriate to its use.
34.16    (c) Class 2b rural vacant land consists of parcels of property, or portions thereof,
34.17that are unplatted real estate, rural in character and not used for agricultural purposes,
34.18including land used for growing trees for timber, lumber, and wood and wood products,
34.19that is not improved with a structure. The presence of a minor, ancillary nonresidential
34.20structure as defined by the commissioner of revenue does not disqualify the property from
34.21classification under this paragraph. Any parcel of 20 acres or more improved with a
34.22structure that is not a minor, ancillary nonresidential structure must be split-classified, and
34.23ten acres must be assigned to the split parcel containing the structure. Class 2b property
34.24has a net class rate of one percent of market value unless it is part of an agricultural
34.25homestead under paragraph (a), or qualifies as class 2c under paragraph (d).
34.26    (d) Class 2c managed forest land consists of no less than 20 and no more than 1,920
34.27acres statewide per taxpayer that is being managed under a forest management plan that
34.28meets the requirements of chapter 290C, but is not enrolled in the sustainable forest
34.29resource management incentive program. It has a class rate of .65 percent, provided that
34.30the owner of the property must apply to the assessor in order for the property to initially
34.31qualify for the reduced rate and provide the information required by the assessor to verify
34.32that the property qualifies for the reduced rate. If the assessor receives the application
34.33and information before May 1 in an assessment year, the property qualifies beginning
34.34with that assessment year. If the assessor receives the application and information after
34.35April 30 in an assessment year, the property may not qualify until the next assessment
34.36year. The commissioner of natural resources must concur that the land is qualified. The
35.1commissioner of natural resources shall annually provide county assessors verification
35.2information on a timely basis. The presence of a minor, ancillary nonresidential structure
35.3as defined by the commissioner of revenue does not disqualify the property from
35.4classification under this paragraph.
35.5    (e) Agricultural land as used in this section means contiguous acreage of which:
35.6(1) of ten acres or more, were used during the preceding year for agricultural
35.7purposes.; or
35.8(2) less than ten acres are used for an intensive livestock confinement operation, but
35.9land used only for pasturing or grazing does not qualify under this clause.
35.10"Agricultural purposes" as used in this section means the raising, cultivation, drying, or
35.11storage of agricultural products for sale, or the storage of machinery or equipment used in
35.12support of agricultural production by the same farm entity. For a property to be classified
35.13as agricultural based only on the drying or storage of agricultural products, the products
35.14being dried or stored must have been produced by the same farm entity as the entity
35.15operating the drying or storage facility. "Agricultural purposes" also includes enrollment
35.16in the Reinvest in Minnesota program under sections 103F.501 to 103F.535 or the federal
35.17Conservation Reserve Program as contained in Public Law 99-198 or a similar state
35.18or federal conservation program if the property was classified as agricultural (i) under
35.19this subdivision for the assessment year 2002 or (ii) in the year prior to its enrollment.
35.20Agricultural classification shall not be based upon the market value of any residential
35.21structures on the parcel or contiguous parcels under the same ownership tract.
35.22    (f) Real estate of less than ten acres, which is Agricultural land under this section
35.23also includes:
35.24(1) any tract that is less than ten acres in size, and does not contain a residence, if
35.25the tract is used exclusively or intensively used for raising or cultivating agricultural
35.26products, shall be considered as agricultural land. To qualify under this paragraph,
35.27property that includes a residential structure must be used intensively for one of the
35.28following purposes:; or
35.29(2) any tract that contains a residence if, after excluding the house, garage, and one
35.30acre of surrounding land, the tract is less than ten acres in size and the portion excluding
35.31the house, garage, and surrounding one acre is used intensively for one or more of the
35.32following purposes:
35.33    (i) for drying or storage of grain or storage of machinery or equipment used to
35.34support agricultural activities on other parcels tracts of property operated by the same
35.35farming entity;
36.1    (ii) as a nursery, provided that only those acres used to produce nursery stock are
36.2considered agricultural land; or
36.3    (iii) for livestock or poultry confinement, provided that land that is used only for
36.4pasturing and grazing does not qualify; or
36.5    (iv) (iii) for market farming; for purposes of this paragraph, "market farming"
36.6means the cultivation of one or more fruits or vegetables or production of animal or other
36.7agricultural products for sale to local markets by the farmer or an organization with which
36.8the farmer is affiliated.
36.9    (g) Land shall be classified as agricultural even if all or a portion of the agricultural
36.10use of that property is the leasing to, or use by another person for agricultural purposes.
36.11    Classification under this subdivision is not determinative for qualifying under
36.12section 273.111.
36.13    (h) The property classification under this section supersedes, for property tax
36.14purposes only, any locally administered agricultural policies or land use restrictions that
36.15define minimum or maximum farm acreage.
36.16    (i) The term "agricultural products" as used in this subdivision includes production
36.17for sale of:
36.18    (1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing
36.19animals, horticultural and nursery stock, fruit of all kinds, vegetables, forage, grains,
36.20bees, and apiary products by the owner;
36.21    (2) fish bred for sale and consumption if the fish breeding occurs on land zoned
36.22for agricultural use;
36.23    (3) the commercial boarding of horses, which may include related horse training and
36.24riding instruction, if the boarding is done on property that is also used for raising pasture
36.25to graze horses or raising or cultivating other agricultural products as defined in clause (1);
36.26    (4) property which is owned and operated by nonprofit organizations used for
36.27equestrian activities, excluding racing;
36.28    (5) game birds and waterfowl bred and raised on a game farm licensed under section
36.2997A.105 or for use on a shooting preserve licensed under section 97A.115;
36.30    (6) insects primarily bred to be used as food for animals;
36.31    (7) trees, grown for sale as a crop, including short rotation woody crops, and not
36.32sold for timber, lumber, wood, or wood products; and
36.33    (8) maple syrup taken from trees grown by a person licensed by the Minnesota
36.34Department of Agriculture under chapter 28A as a food processor.
36.35    (j) If a parcel used for agricultural purposes is also used for commercial or industrial
36.36purposes, including but not limited to:
37.1    (1) wholesale and retail sales;
37.2    (2) processing of raw agricultural products or other goods;
37.3    (3) warehousing or storage of processed goods; and
37.4    (4) office facilities for the support of the activities enumerated in clauses (1), (2),
37.5and (3),
37.6the assessor shall classify the part of the parcel used for agricultural purposes as class
37.71b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its
37.8use. The grading, sorting, and packaging of raw agricultural products for first sale is
37.9considered an agricultural purpose. A greenhouse or other building where horticultural
37.10or nursery products are grown that is also used for the conduct of retail sales must be
37.11classified as agricultural if it is primarily used for the growing of horticultural or nursery
37.12products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of
37.13those products. Use of a greenhouse or building only for the display of already grown
37.14horticultural or nursery products does not qualify as an agricultural purpose.
37.15    (k) The assessor shall determine and list separately on the records the market value
37.16of the homestead dwelling and the one acre of land on which that dwelling is located. If
37.17any farm buildings or structures are located on this homesteaded acre of land, their market
37.18value shall not be included in this separate determination.
37.19    (l) Class 2d airport landing area consists of a landing area or public access area of
37.20a privately owned public use airport. It has a class rate of one percent of market value.
37.21To qualify for classification under this paragraph, a privately owned public use airport
37.22must be licensed as a public airport under section 360.018. For purposes of this paragraph,
37.23"landing area" means that part of a privately owned public use airport properly cleared,
37.24regularly maintained, and made available to the public for use by aircraft and includes
37.25runways, taxiways, aprons, and sites upon which are situated landing or navigational aids.
37.26A landing area also includes land underlying both the primary surface and the approach
37.27surfaces that comply with all of the following:
37.28    (i) the land is properly cleared and regularly maintained for the primary purposes of
37.29the landing, taking off, and taxiing of aircraft; but that portion of the land that contains
37.30facilities for servicing, repair, or maintenance of aircraft is not included as a landing area;
37.31    (ii) the land is part of the airport property; and
37.32    (iii) the land is not used for commercial or residential purposes.
37.33The land contained in a landing area under this paragraph must be described and certified
37.34by the commissioner of transportation. The certification is effective until it is modified,
37.35or until the airport or landing area no longer meets the requirements of this paragraph.
37.36For purposes of this paragraph, "public access area" means property used as an aircraft
38.1parking ramp, apron, or storage hangar, or an arrival and departure building in connection
38.2with the airport.
38.3    (m) Class 2e consists of land with a commercial aggregate deposit that is not actively
38.4being mined and is not otherwise classified as class 2a or 2b, provided that the land is not
38.5located in a county that has elected to opt-out of the aggregate preservation program as
38.6provided in section 273.1115, subdivision 6. It has a class rate of one percent of market
38.7value. To qualify for classification under this paragraph, the property must be at least
38.8ten contiguous acres in size and the owner of the property must record with the county
38.9recorder of the county in which the property is located an affidavit containing:
38.10    (1) a legal description of the property;
38.11    (2) a disclosure that the property contains a commercial aggregate deposit that is not
38.12actively being mined but is present on the entire parcel enrolled;
38.13    (3) documentation that the conditional use under the county or local zoning
38.14ordinance of this property is for mining; and
38.15    (4) documentation that a permit has been issued by the local unit of government
38.16or the mining activity is allowed under local ordinance. The disclosure must include a
38.17statement from a registered professional geologist, engineer, or soil scientist delineating
38.18the deposit and certifying that it is a commercial aggregate deposit.
38.19    For purposes of this section and section 273.1115, "commercial aggregate deposit"
38.20means a deposit that will yield crushed stone or sand and gravel that is suitable for use
38.21as a construction aggregate; and "actively mined" means the removal of top soil and
38.22overburden in preparation for excavation or excavation of a commercial deposit.
38.23    (n) When any portion of the property under this subdivision or subdivision 22 begins
38.24to be actively mined, the owner must file a supplemental affidavit within 60 days from
38.25the day any aggregate is removed stating the number of acres of the property that is
38.26actively being mined. The acres actively being mined must be (1) valued and classified
38.27under subdivision 24 in the next subsequent assessment year, and (2) removed from the
38.28aggregate resource preservation property tax program under section 273.1115, if the
38.29land was enrolled in that program. Copies of the original affidavit and all supplemental
38.30affidavits must be filed with the county assessor, the local zoning administrator, and the
38.31Department of Natural Resources, Division of Land and Minerals. A supplemental
38.32affidavit must be filed each time a subsequent portion of the property is actively mined,
38.33provided that the minimum acreage change is five acres, even if the actual mining activity
38.34constitutes less than five acres.
39.1(o) The definitions prescribed by the commissioner under paragraphs (c) and (d) are
39.2not rules and are exempt from the rulemaking provisions of chapter 14, and the provisions
39.3in section 14.386 concerning exempt rules do not apply.
39.4EFFECTIVE DATE.This section is effective the day following final enactment.

39.5    Sec. 9. Minnesota Statutes 2010, section 273.33, subdivision 2, is amended to read:
39.6    Subd. 2. Listing and assessment by commissioner. The personal property,
39.7consisting of the pipeline system of mains, pipes, and equipment attached thereto, of
39.8pipeline companies and others engaged in the operations or business of transporting natural
39.9gas, gasoline, crude oil, or other petroleum products by pipelines, shall be listed with and
39.10assessed by the commissioner of revenue and the values provided to the city or county
39.11assessor by order. This subdivision shall not apply to the assessment of the products
39.12transported through the pipelines nor to the lines of local commercial gas companies
39.13engaged primarily in the business of distributing gas to consumers at retail nor to pipelines
39.14used by the owner thereof to supply natural gas or other petroleum products exclusively
39.15for such owner's own consumption and not for resale to others. If more than 85 percent
39.16of the natural gas or other petroleum products actually transported over the pipeline is
39.17used for the owner's own consumption and not for resale to others, then this subdivision
39.18shall not apply; provided, however, that in that event, the pipeline shall be assessed in
39.19proportion to the percentage of gas actually transported over such pipeline that is not used
39.20for the owner's own consumption. On or before August 1, the commissioner shall certify
39.21to the auditor of each county, the amount of such personal property assessment against
39.22each company in each district in which such property is located. If the commissioner
39.23determines that the amount of personal property assessment certified on or before August
39.241 is in error, the commissioner may issue a corrected certification on or before October 1.
39.25EFFECTIVE DATE.This section is effective for taxes payable in 2012 and
39.26thereafter.

39.27    Sec. 10. Minnesota Statutes 2010, section 273.37, subdivision 2, is amended to read:
39.28    Subd. 2. Listing and assessment by commissioner. Transmission lines of less
39.29than 69 kv, transmission lines of 69 kv and above located in an unorganized township,
39.30and distribution lines, and equipment attached thereto, having a fixed situs outside the
39.31corporate limits of cities except distribution lines taxed as provided in sections 273.40
39.32and 273.41, shall be listed with and assessed by the commissioner of revenue in the
39.33county where situated and the values provided to the city or county assessor by order.
40.1The commissioner shall assess such property at the percentage of market value fixed by
40.2law; and, on or before August 1, shall certify to the auditor of each county in which
40.3such property is located the amount of the assessment made against each company and
40.4person owning such property. If the commissioner determines that the amount of the
40.5assessment certified on or before August 1 is in error, the commissioner may issue a
40.6corrected certification on or before October 1.
40.7EFFECTIVE DATE.This section is effective for taxes payable in 2012 and
40.8thereafter.

40.9    Sec. 11. Minnesota Statutes 2010, section 273.3711, is amended to read:
40.10273.3711 RECOMMENDED AND ORDERED VALUES.
40.11    For purposes of sections 273.33, 273.35, 273.36, 273.37, 273.371, and 273.372,
40.12all values not required to be listed and assessed by the commissioner of revenue are
40.13recommended values. If the commissioner provides recommended values, the values must
40.14be certified to the auditor of each county in which the property is located on or before
40.15August 1. If the commissioner determines that the certified recommended value is in error
40.16the commissioner may issue a corrected certification on or before October 1.
40.17EFFECTIVE DATE.This section is effective for taxes payable in 2012 and
40.18thereafter.

40.19    Sec. 12. Minnesota Statutes 2010, section 274.175, is amended to read:
40.20274.175 VALUES FINALIZED.
40.21The assessments recorded by the county assessor and the county auditor under
40.22sections 273.124, subdivision 9; 274.16; 274.17; or other law for real and personal
40.23property are final on July 1 of the assessment year, except for property added to the
40.24assessment rolls under section 272.02, subdivision 38, and assessments certified to the
40.25auditor under sections 270.87; 273.33, subdivision 2, and; 273.37, subdivision 2,; and
40.26273.3711 or deleted because of tax forfeiture pursuant to chapter 281. No changes in value
40.27may be made after July 1 of the assessment year, except for corrections permitted in
40.28sections 273.01 and 274.01, or assessments certified to the auditor under sections 270.87;
40.29273.33, subdivision 2 , and; 273.37, subdivision 2; and 273.3711.
40.30EFFECTIVE DATE.This section is effective for taxes payable in 2012 and
40.31thereafter.

41.1    Sec. 13. Minnesota Statutes 2010, section 278.05, subdivision 6, is amended to read:
41.2    Subd. 6. Dismissal of petition; exclusion of certain evidence. (a) In cases where
41.3the petitioner contests the valuation of income-producing property, information, including
41.4income and expense figures in the form of the following information must be provided to
41.5the county assessor no later than August 1 of the taxes payable year:
41.6(1) a year-end financial statements statement for the year prior to the assessment
41.7date,;
41.8(2) a year-end financial statements statement for the year of the assessment date, and;
41.9(3) a rent rolls roll on or near the assessment date including listing the tenant name,
41.10lease start and end dates, option terms, base rent, square footage leased and vacant space,
41.11verified net rentable areas in the form of net rentable square footage of the building or
41.12buildings, and anticipated income and expenses in the form of proposed budgets for
41.13the year subsequent to the year of the assessment date, must be provided to the county
41.14assessor no later than 60 days after the applicable filing deadline contained in section
41.15278.01, subdivision 1 or 4.;
41.16(4) identification of all lease agreements not disclosed on a rent roll in the response
41.17to clause (3), listing the tenant name, lease start and end dates, base rent, and square
41.18footage leased;
41.19(5) net rentable square footage of the building or buildings; and
41.20(6) anticipated income and expenses in the form of a proposed budget for the year
41.21subsequent to the year of the assessment date.
41.22(b) The information required to be provided to the county assessor under paragraph
41.23(a) does not include leases. Failure to provide the information required in this paragraph (a)
41.24shall result in the dismissal of the petition, unless (1) the failure to provide it was due to the
41.25unavailability of the evidence information at the time that the information was due, or (2)
41.26the petitioner was not aware of or informed of the requirement to provide the information.
41.27If the petitioner proves that the requirements under clause (2) are met, the petitioner has
41.28an additional 30 days to provide the information from the time the petitioner became
41.29aware of or was informed of the requirement to provide the information, otherwise the
41.30petition shall be dismissed.
41.31    (c) If, after the August 1 deadline set in paragraph (a), a county assessor determines
41.32that the actual leases in effect on the assessment date are necessary to properly evaluate
41.33the income-producing property, then a county assessor may require that the petitioner
41.34submit the leases. The petitioner must provide the requested information to the county
41.35assessor within 60 days of a county assessor's request. The tax court shall hear and decide
41.36any issues relating to subsequent information requests by a county assessor. Failure to
42.1provide the information required in this paragraph shall be addressed under Rules of
42.2Civil Procedure, rule 37.
42.3    (b) (d) Provided that the information as contained in paragraph (a) is timely
42.4submitted to the county assessor, the county assessor shall furnish the petitioner at least
42.5five days before the hearing under this chapter with the property's appraisal, if any,
42.6which will be presented to the court at the hearing. The petitioner shall furnish to the
42.7county assessor at least five days before the hearing under this chapter with the property's
42.8appraisal, if any, which will be presented to the court at the hearing. An appraisal of the
42.9petitioner's property done by or for the county shall not be admissible as evidence if the
42.10county assessor does not comply with the provisions in this paragraph. The petition shall
42.11be dismissed if the petitioner does not comply with the provisions in this paragraph.
42.12EFFECTIVE DATE.This section is effective for petitions contesting the 2010
42.13assessment and assessments made after that date.

42.14    Sec. 14. Minnesota Statutes 2010, section 282.01, subdivision 1a, is amended to read:
42.15    Subd. 1a. Conveyance to public entities. (a) Upon written request from a state
42.16agency or a governmental subdivision of the state, a parcel of unsold tax-forfeited land
42.17must be withheld from sale or lease to others for a maximum of six months. The request
42.18must be submitted to the county auditor. Upon receipt, the county auditor must withhold
42.19the parcel from sale or lease to any other party for six months, and must confirm the
42.20starting date of the six-month withholding period to the requesting agency or subdivision.
42.21If the request is from a governmental subdivision of the state, the governmental
42.22subdivision must pay the maintenance costs incurred by the county during the period the
42.23parcel is withheld. The county board may approve a sale or conveyance to the requesting
42.24party during the withholding period. A conveyance of the property to the requesting
42.25party terminates the withholding period.
42.26A governmental subdivision of the state must not make, and a county auditor must
42.27not act upon, a second request to withhold a parcel from sale or lease within 18 months
42.28of a previous request for that parcel. A county may reject a request made under this
42.29paragraph if the request is made more than 30 days after the county has given notice to the
42.30requesting state agency or governmental subdivision of the state that the county intends to
42.31sell or otherwise dispose of the property.
42.32(b) Nonconservation tax-forfeited lands may be sold by the county board, for
42.33their market value as determined by the county board, to an organized or incorporated
42.34governmental subdivision of the state for any public purpose for which the subdivision is
42.35authorized to acquire property. When the term "market value" is used in this section, it
43.1means an estimate of the full and actual market value of the parcel as determined by the
43.2county board, but in making this determination, the board and the persons employed by or
43.3under contract with the board in order to perform, conduct, or assist in the determination,
43.4are exempt from the licensure requirements of chapter 82B.
43.5(c) Nonconservation tax-forfeited lands may be released from the trust in favor of
43.6the taxing districts on application to the county board by a state agency for an authorized
43.7use at not less than their market value as determined by the county board.
43.8(d) Nonconservation tax-forfeited lands may be sold by the county board to an
43.9organized or incorporated governmental subdivision of the state or state agency for less
43.10than their market value if:
43.11(1) the county board determines that a sale at a reduced price is in the public interest
43.12because a reduced price is necessary to provide an incentive to correct the blighted
43.13conditions that make the lands undesirable in the open market, or the reduced price will
43.14lead to the development of affordable housing; and
43.15(2) the governmental subdivision or state agency has documented its specific plans
43.16for correcting the blighted conditions or developing affordable housing, and the specific
43.17law or laws that empower it to acquire real property in furtherance of the plans.
43.18If the sale under this paragraph is to a governmental subdivision of the state, the
43.19commissioner of revenue must convey the property on behalf of the state by quit claim
43.20deed. If the sale under this paragraph is to a state agency, the commissioner must issue a
43.21conveyance document that releases the property from the trust in favor of the taxing
43.22districts.
43.23(e) Nonconservation tax-forfeited land held in trust in favor of the taxing districts
43.24may be conveyed by the commissioner of revenue in the name of the state to a
43.25governmental subdivision for an authorized public use, if an application is submitted to the
43.26commissioner which includes a statement of facts as to the use to be made of the tract and
43.27the favorable recommendation of the county board. For the purposes of this paragraph,
43.28"authorized public use" means a use that allows an indefinite segment of the public to
43.29physically use and enjoy the property in numbers appropriate to its size and use, or is for a
43.30public service facility. Authorized public uses as defined in this paragraph are limited to:
43.31(1) a road, or right-of-way for a road;
43.32(2) a park that is both available to, and accessible by, the public that contains
43.33amenities improvements such as campgrounds, playgrounds, athletic fields, trails, or
43.34shelters;
43.35(3) trails for walking, bicycling, snowmobiling, or other recreational purposes, along
43.36with a reasonable amount of surrounding land maintained in its natural state;
44.1(4) transit facilities for buses, light rail transit, commuter rail or passenger rail,
44.2including transit ways, park-and-ride lots, transit stations, maintenance and garage
44.3facilities, and other facilities related to a public transit system;
44.4(5) public beaches or boat launches;
44.5(6) public parking;
44.6(7) civic recreation or conference facilities; and
44.7(8) public service facilities such as fire halls, police stations, lift stations, water
44.8towers, sanitation facilities, water treatment facilities, and administrative offices.
44.9No monetary compensation or consideration is required for the conveyance, except as
44.10provided in subdivision 1g, but the conveyance is subject to the conditions provided in
44.11law, including, but not limited to, the reversion provisions of subdivisions 1c and 1d.
44.12(f) The commissioner of revenue shall convey a parcel of nonconservation
44.13tax-forfeited land to a local governmental subdivision of the state by quit claim deed
44.14on behalf of the state upon the favorable recommendation of the county board if the
44.15governmental subdivision has certified to the board that prior to forfeiture the subdivision
44.16was entitled to the parcel under a written development agreement or instrument, but
44.17the conveyance failed to occur prior to forfeiture. No compensation or consideration is
44.18required for, and no conditions attach to, the conveyance.
44.19(g) The commissioner of revenue shall convey a parcel of nonconservation
44.20tax-forfeited land to the association of a common interest community by quit claim deed
44.21upon the favorable recommendation of the county board if the association certifies to the
44.22board that prior to forfeiture the association was entitled to the parcel under a written
44.23agreement, but the conveyance failed to occur prior to forfeiture. No compensation or
44.24consideration is required for, and no conditions attach to, the conveyance.
44.25(h) Conservation tax-forfeited land may be sold to a governmental subdivision of
44.26the state for less than its market value for either: (1) creation or preservation of wetlands;
44.27(2) drainage or storage of storm water under a storm water management plan; or (3)
44.28preservation, or restoration and preservation, of the land in its natural state. The deed must
44.29contain a restrictive covenant limiting the use of the land to one of these purposes for
44.3030 years or until the property is reconveyed back to the state in trust. At any time, the
44.31governmental subdivision may reconvey the property to the state in trust for the taxing
44.32districts. The deed of reconveyance is subject to approval by the commissioner of revenue.
44.33No part of a purchase price determined under this paragraph shall be refunded upon a
44.34reconveyance, but the amount paid for a conveyance under this paragraph may be taken
44.35into account by the county board when setting the terms of a future sale of the same
44.36property to the same governmental subdivision under paragraph (b) or (d). If the lands
45.1are unplatted and located outside of an incorporated municipality and the commissioner
45.2of natural resources determines there is a mineral use potential, the sale is subject to the
45.3approval of the commissioner of natural resources.
45.4(i) A park and recreation board in a city of the first class is a governmental
45.5subdivision for the purposes of this section.
45.6EFFECTIVE DATE.This section is effective the day following final enactment.

45.7    Sec. 15. Minnesota Statutes 2010, section 282.01, subdivision 1c, is amended to read:
45.8    Subd. 1c. Deed of conveyance; form; approvals. The deed of conveyance for
45.9conveying property conveyed for an authorized public use under the authorities in
45.10subdivision 1a, paragraph (e) this section, must be on a form approved by the attorney
45.11general and must be conditioned on continued use of the property for the purpose stated in
45.12the application as provided in this section. These All deeds conveying property for an
45.13authorized public use, regardless of when executed, are conditional use deeds that convey
45.14a defeasible estate. Reversion of the estate occurs by operation of law and without the
45.15requirement for any affirmative act by or on behalf of the state when there is a failure to
45.16put the property to the approved authorized public use for which it was conveyed, or an
45.17abandonment of that use, except as provided in subdivision 1d.
45.18EFFECTIVE DATE.This section is effective the day following final enactment.

45.19    Sec. 16. Minnesota Statutes 2010, section 282.01, subdivision 1d, is amended to read:
45.20    Subd. 1d. Reverter for failure to use; conveyance to state. (a) If After three years
45.21from the date of the any conveyance of tax-forfeited land to a governmental subdivision
45.22to which tax-forfeited land has been conveyed for an authorized public use as provided
45.23in subdivision 1a, paragraph (e), fails this section, regardless of when the deed for the
45.24authorized public use was executed, if the governmental subdivision has failed to put the
45.25land to that use, or abandons that use, the governing body of the subdivision must: (1)
45.26with the approval of the county board, purchase the property for an authorized public
45.27purpose at the present market value as determined by the county board, or (2) authorize
45.28the proper officers to convey the land, or the part of the land not required for an authorized
45.29public use, to the state of Minnesota in trust for the taxing districts. If the governing
45.30body purchases the property under clause (1), the commissioner of revenue shall, upon
45.31proper application submitted by the county auditor, convey the property on behalf of the
45.32state by quit claim deed to the subdivision free of a use restriction and the possibility of
45.33reversion or defeasement. If the governing body decides to reconvey the property to the
46.1state under this clause, the officers shall execute a deed of conveyance immediately. The
46.2conveyance is subject to the approval of the commissioner and its form must be approved
46.3by the attorney general. For the purposes of this paragraph 15 years from the date of
46.4the conveyance, there is no failure to put the land to the authorized public use and no
46.5abandonment of that use if a formal plan of the governmental subdivision, including, but
46.6not limited to, a comprehensive plan or land use plan that, shows an intended future use
46.7of the land for the authorized public use.
46.8(b) Property held by a governmental subdivision of the state under a conditional use
46.9deed executed under subdivision 1a, paragraph (e), this section by the commissioner of
46.10revenue on or after January 1, 2007, may be acquired by that governmental subdivision
46.11after 15 years from the date of the conveyance if the commissioner determines upon
46.12written application from the subdivision that the subdivision has in fact put the property
46.13to the authorized public use for which it was conveyed, and the subdivision has made a
46.14finding that it has no current plans to change the use of the lands. Prior to conveying the
46.15property, the commissioner shall inquire whether the county board where the land is
46.16located objects to a conveyance of the property to the subdivision without conditions and
46.17without further act by or obligation of the subdivision. If the county does not object within
46.1860 days, and the commissioner makes a favorable determination, the commissioner shall
46.19issue a quit claim deed on behalf of the state unconditionally conveying the property to the
46.20governmental subdivision. For purposes of this paragraph, demonstration of an intended
46.21future use for the authorized public use in a formal plan of the governmental subdivision
46.22does not constitute use for that authorized public use.
46.23(c) Property held by a governmental subdivision of the state under a conditional use
46.24deed executed under subdivision 1a, paragraph (e), this section by the commissioner of
46.25revenue before January 1, 2007, is released from the use restriction and possibility of
46.26reversion on January 1, 2022, if the county board records a resolution describing the
46.27land and citing this paragraph. The county board may authorize the county treasurer
46.28to deduct the amount of the recording fees from future settlements of property taxes
46.29to the subdivision.
46.30(d) All Property conveyed under a conditional use deed executed under subdivision
46.311a, paragraph (e), this section by the commissioner of revenue, regardless of when the
46.32deed for the authorized public use was executed, is released from the use restriction and
46.33reverter, and any use restriction or reverter for which no declaration of reversion has been
46.34recorded with the county recorder or registrar of titles, as appropriate, is nullified on the
46.35later of: (1) January 1, 2015; (2) 30 years from the date the deed was acknowledged; or
46.36(3) final resolution of an appeal to district court under subdivision 1e, if a lis pendens
47.1related to the appeal is recorded in the office of the county recorder or registrar of titles,
47.2as appropriate, prior to January 1, 2015.
47.3EFFECTIVE DATE.This section is effective the day following final enactment.

47.4    Sec. 17. Minnesota Statutes 2010, section 282.014, is amended to read:
47.5282.014 COMPLETION OF SALE, FEE, CONVEYANCE RECORDED.
47.6(a) Upon compliance by the purchaser with the provisions of this chapter and with
47.7the terms and conditions of the sale, and upon full payment for the land, plus a $25 fee
47.8in addition to the sale price, the sale shall be complete and a conveyance of the land
47.9shall be issued to the purchaser as provided by the appropriate statutes according to the
47.10status of the land upon forfeiture.
47.11The conveyance must be forwarded to the county auditor who shall have the
47.12conveyance recorded before issuing it to the purchaser.
47.13(b) In order for the commissioner of revenue to issue a conveyance of tax-forfeited
47.14land under any provision of this chapter other than section 282.01, subdivision 1a,
47.15paragraph (e), or 282.33, and that is not covered by paragraph (a), the grantee must pay
47.16the fee provided in paragraph (a).
47.17The conveyance must be forwarded to the county auditor who shall have the
47.18conveyance recorded before issuing it to the grantee.
47.19EFFECTIVE DATE.This section is effective for deeds executed by the
47.20commissioner of revenue after June 30, 2011.

47.21    Sec. 18. Minnesota Statutes 2010, section 282.12, is amended to read:
47.22282.12 ALL MINERALS RESERVED.
47.23Any sale of such conveyance of forfeited lands shall be subject to exceptions and
47.24reservations in this state, in trust for the taxing districts of all minerals and mineral rights.
47.25EFFECTIVE DATE.This section is effective retroactively from July 1, 2010.

47.26    Sec. 19. Laws 2010, chapter 389, article 1, section 12, the effective date, is amended to
47.27read:
47.28EFFECTIVE DATE.This section is effective for assessment years 2010 and 2011,
47.29for taxes payable in 2011 and 2012, and thereafter.

47.30    Sec. 20. REPEALER.
48.1Minnesota Statutes 2010, sections 272.02, subdivision 34; 273.124, subdivision 10;
48.2and 281.37, are repealed.
48.3EFFECTIVE DATE.This section is effective the day following final enactment.


48.6    Section 1. Minnesota Statutes 2010, section 289A.60, subdivision 31, is amended to
48.7read:
48.8    Subd. 31. Accelerated payment of monthly sales tax liability; penalty for
48.9underpayment. For payments made after September 1, 2010, if a vendor is required
48.10by section 289A.20, subdivision 4, paragraph (a), clause (2), item (i) or (ii), to make
48.11accelerated payments, then the penalty for underpayment is as follows:
48.12(a) For those vendors that must remit a 90 percent payment by the 14th day of the
48.13month following the month in which the taxable event occurred, as an estimation of the
48.14monthly sales tax liabilities liability, including the liability of any fee or other tax that
48.15is to be reported on the same return as and paid with the chapter 297A taxes, for the
48.16month in which the taxable event occurred, the vendor shall pay a penalty equal to ten
48.17percent of the amount of liability that was required to be paid by the 14th day of the
48.18month, less the amount remitted by the 14th day of the month. The penalty must not be
48.19imposed, however, if the amount remitted by the 14th day of the month equals the least
48.20of: (1) 90 percent of the liability for the month preceding the month in which the taxable
48.21event occurred; (2) 90 percent of the liability for the same month in the previous calendar
48.22year as the month in which the taxable event occurred; or (3) 90 percent of the average
48.23monthly liability for the previous calendar year.
48.24(b) For those vendors that, on or before the 20th day of the month in which the
48.25taxable event occurs, must remit to the commissioner a prepayment of the sales tax
48.26liabilities liability for the month in which the taxable event occurs equal to 67 percent of
48.27the liabilities liability for the previous month, including the liability of any fee or other tax
48.28that is to be reported on the same return as and paid with the chapter 297A taxes, for the
48.29month in which the taxable event occurred, the vendor shall pay a penalty equal to ten
48.30percent of the amount of liability that was required to be paid by the 20th of the month,
48.31less the amount remitted by the 20th of the month. The penalty must not be imposed,
48.32however, if the amount remitted by the 20th of the month equals the lesser of 67 percent
48.33of the liability for the month preceding the month in which the taxable event occurred
48.34or: (1) 67 percent of the liability of the same month in the previous calendar year as the
49.1month in which the taxable event occurred; or (2) an amount equal to the liability for the
49.2month in which the taxable event occurred.
49.3EFFECTIVE DATE.This section is effective for sales and purchases made after
49.4June 30, 2011.

49.5    Sec. 2. Minnesota Statutes 2010, section 297A.61, subdivision 3, is amended to read:
49.6    Subd. 3. Sale and purchase. (a) "Sale" and "purchase" include, but are not limited
49.7to, each of the transactions listed in this subdivision.
49.8    (b) Sale and purchase include:
49.9    (1) any transfer of title or possession, or both, of tangible personal property, whether
49.10absolutely or conditionally, for a consideration in money or by exchange or barter; and
49.11    (2) the leasing of or the granting of a license to use or consume, for a consideration
49.12in money or by exchange or barter, tangible personal property, other than a manufactured
49.13home used for residential purposes for a continuous period of 30 days or more.
49.14    (c) Sale and purchase include the production, fabrication, printing, or processing of
49.15tangible personal property for a consideration for consumers who furnish either directly or
49.16indirectly the materials used in the production, fabrication, printing, or processing.
49.17    (d) Sale and purchase include the preparing for a consideration of food.
49.18Notwithstanding section 297A.67, subdivision 2, taxable food includes, but is not limited
49.19to, the following:
49.20    (1) prepared food sold by the retailer;
49.21    (2) soft drinks;
49.22    (3) candy;
49.23    (4) dietary supplements; and
49.24    (5) all food sold through vending machines.
49.25    (e) A sale and a purchase includes the furnishing for a consideration of electricity,
49.26gas, water, or steam for use or consumption within this state.
49.27    (f) A sale and a purchase includes the transfer for a consideration of prewritten
49.28computer software whether delivered electronically, by load and leave, or otherwise.
49.29    (g) A sale and a purchase includes the furnishing for a consideration of the following
49.30services:
49.31    (1) the privilege of admission to places of amusement, recreational areas, or athletic
49.32events, and the making available of amusement devices, tanning facilities, reducing
49.33salons, steam baths, Turkish baths, health clubs, and spas or athletic facilities;
49.34    (2) lodging and related services by a hotel, rooming house, resort, campground,
49.35motel, or trailer camp, including furnishing the guest of the facility with access to
50.1telecommunication services, and the granting of any similar license to use real property
50.2in a specific facility, other than the renting or leasing of it for a continuous period of
50.330 days or more under an enforceable written agreement that may not be terminated
50.4without prior notice;
50.5    (3) nonresidential parking services, whether on a contractual, hourly, or other
50.6periodic basis, except for parking at a meter;
50.7    (4) the granting of membership in a club, association, or other organization if:
50.8    (i) the club, association, or other organization makes available for the use of its
50.9members sports and athletic facilities, without regard to whether a separate charge is
50.10assessed for use of the facilities; and
50.11    (ii) use of the sports and athletic facility is not made available to the general public
50.12on the same basis as it is made available to members.
50.13Granting of membership means both onetime initiation fees and periodic membership
50.14dues. Sports and athletic facilities include golf courses; tennis, racquetball, handball, and
50.15squash courts; basketball and volleyball facilities; running tracks; exercise equipment;
50.16swimming pools; and other similar athletic or sports facilities;
50.17    (5) delivery of aggregate materials by a third party, excluding delivery of aggregate
50.18material used in road construction,; and delivery of concrete block by a third party if
50.19the delivery would be subject to the sales tax if provided by the seller of the concrete
50.20block; and
50.21    (6) services as provided in this clause:
50.22    (i) laundry and dry cleaning services including cleaning, pressing, repairing, altering,
50.23and storing clothes, linen services and supply, cleaning and blocking hats, and carpet,
50.24drapery, upholstery, and industrial cleaning. Laundry and dry cleaning services do not
50.25include services provided by coin operated facilities operated by the customer;
50.26    (ii) motor vehicle washing, waxing, and cleaning services, including services
50.27provided by coin operated facilities operated by the customer, and rustproofing,
50.28undercoating, and towing of motor vehicles;
50.29    (iii) building and residential cleaning, maintenance, and disinfecting services and
50.30pest control and exterminating services;
50.31    (iv) detective, security, burglar, fire alarm, and armored car services; but not
50.32including services performed within the jurisdiction they serve by off-duty licensed peace
50.33officers as defined in section 626.84, subdivision 1, or services provided by a nonprofit
50.34organization for monitoring and electronic surveillance of persons placed on in-home
50.35detention pursuant to court order or under the direction of the Minnesota Department
50.36of Corrections;
51.1    (v) pet grooming services;
51.2    (vi) lawn care, fertilizing, mowing, spraying and sprigging services; garden planting
51.3and maintenance; tree, bush, and shrub pruning, bracing, spraying, and surgery; indoor
51.4plant care; tree, bush, shrub, and stump removal, except when performed as part of a land
51.5clearing contract as defined in section 297A.68, subdivision 40; and tree trimming for
51.6public utility lines. Services performed under a construction contract for the installation of
51.7shrubbery, plants, sod, trees, bushes, and similar items are not taxable;
51.8    (vii) massages, except when provided by a licensed health care facility or
51.9professional or upon written referral from a licensed health care facility or professional for
51.10treatment of illness, injury, or disease; and
51.11    (viii) the furnishing of lodging, board, and care services for animals in kennels and
51.12other similar arrangements, but excluding veterinary and horse boarding services.
51.13    In applying the provisions of this chapter, the terms "tangible personal property"
51.14and "retail sale" include taxable services listed in clause (6), items (i) to (vi) and (viii),
51.15and the provision of these taxable services, unless specifically provided otherwise.
51.16Services performed by an employee for an employer are not taxable. Services performed
51.17by a partnership or association for another partnership or association are not taxable if
51.18one of the entities owns or controls more than 80 percent of the voting power of the
51.19equity interest in the other entity. Services performed between members of an affiliated
51.20group of corporations are not taxable. For purposes of the preceding sentence, "affiliated
51.21group of corporations" means those entities that would be classified as members of an
51.22affiliated group as defined under United States Code, title 26, section 1504, disregarding
51.23the exclusions in section 1504(b).
51.24    For purposes of clause (5), "road construction" means construction of (1) public
51.25roads, (2) cartways, and (3) private roads in townships located outside of the seven-county
51.26metropolitan area up to the point of the emergency response location sign.
51.27    (h) A sale and a purchase includes the furnishing for a consideration of tangible
51.28personal property or taxable services by the United States or any of its agencies or
51.29instrumentalities, or the state of Minnesota, its agencies, instrumentalities, or political
51.30subdivisions.
51.31    (i) A sale and a purchase includes the furnishing for a consideration of
51.32telecommunications services, ancillary services associated with telecommunication
51.33services, cable television services, direct satellite services, and ring tones.
51.34Telecommunication services include, but are not limited to, the following services,
51.35as defined in section 297A.669: air-to-ground radiotelephone service, mobile
51.36telecommunication service, postpaid calling service, prepaid calling service, prepaid
52.1wireless calling service, and private communication services. The services in this
52.2paragraph are taxed to the extent allowed under federal law.
52.3    (j) A sale and a purchase includes the furnishing for a consideration of installation if
52.4the installation charges would be subject to the sales tax if the installation were provided
52.5by the seller of the item being installed.
52.6    (k) A sale and a purchase includes the rental of a vehicle by a motor vehicle dealer
52.7to a customer when (1) the vehicle is rented by the customer for a consideration, or (2)
52.8the motor vehicle dealer is reimbursed pursuant to a service contract as defined in section
52.959B.02, subdivision 11.
52.10EFFECTIVE DATE.This section is effective the day following final enactment.

52.11    Sec. 3. Minnesota Statutes 2010, section 297A.62, is amended by adding a subdivision
52.12to read:
52.13    Subd. 5. Transitional period for services. When there is a change in the rate of tax
52.14imposed by this section, the following transitional period shall apply to the retail sale of
52.15services covering a billing period starting before and ending after the statutory effective
52.16date of the rate change:
52.17(1) for a rate increase, the new rate shall apply to the first billing period starting
52.18on or after the effective date; and
52.19(2) for a rate decrease, the new rate shall apply to bills rendered on or after the
52.20effective date.
52.21EFFECTIVE DATE.This section is effective the day following final enactment.

52.22    Sec. 4. Minnesota Statutes 2010, section 297A.63, is amended by adding a subdivision
52.23to read:
52.24    Subd. 3. Transitional period for services. When there is a change in the rate of
52.25tax imposed by this section, the following transitional period shall apply to the taxable
52.26services purchased for use, storage, distribution, or consumption in this state when the
52.27service purchased covers a billing period starting before and ending after the statutory
52.28effective date of the rate change:
52.29(1) for a rate increase, the new rate shall apply to the first billing period starting
52.30on or after the effective date; and
52.31(2) for a rate decrease, the new rate shall apply to bills rendered on or after the
52.32effective date.
52.33EFFECTIVE DATE.This section is effective the day following final enactment.

53.1    Sec. 5. Minnesota Statutes 2010, section 297A.668, subdivision 7, is amended to read:
53.2    Subd. 7. Advertising and promotional direct mail. (a) Notwithstanding other
53.3subdivisions of this section, the provisions in paragraphs (b) to (e) apply to the sale of
53.4advertising and promotional direct mail. "Advertising and promotional direct mail" means
53.5printed material that is direct mail as defined in section 297A.61, subdivision 35, the
53.6primary purpose of which is to attract public attention to a product, person, business, or
53.7organization, or to attempt to sell, popularize, or secure financial support for a person,
53.8business, organization, or product. "Product" includes tangible personal property, a digital
53.9product transferred electronically, or a service.
53.10(b) A purchaser of advertising and promotional direct mail that is not a holder of
53.11a direct pay permit shall provide to the seller, in conjunction with the purchase, either a
53.12direct mail form or may provide the seller with either:
53.13(1) a fully completed exemption certificate as described in section 297A.72
53.14indicating that the purchaser is authorized to pay any sales or use tax due on purchases
53.15made by the purchaser directly to the commissioner under section 297A.89;
53.16(2) a fully completed exemption certificate claiming an exemption for direct mail; or
53.17(3) information to show showing the jurisdictions to which the advertising and
53.18promotional direct mail is to be delivered to recipients.
53.19(1) Upon receipt of the direct mail form, (c) In the absence of bad faith, if the
53.20purchaser provides one of the exemption certificates indicated in paragraph (b), clauses (1)
53.21and (2), the seller is relieved of all obligations to collect, pay, or remit the applicable tax
53.22and the purchaser is obligated to pay or remit the applicable tax on a direct pay basis. A
53.23direct mail form remains in effect for all future sales of direct mail by the seller to the
53.24purchaser until it is revoked in writing. tax on any transaction involving advertising and
53.25promotional direct mail to which the certificate applies. The purchaser shall source the
53.26sale to the jurisdictions to which the advertising and promotional direct mail is to be
53.27delivered to the recipients of the mail, and shall report and pay any applicable tax due.
53.28(2) Upon receipt of (d) If the purchaser provides the seller information from the
53.29purchaser showing the jurisdictions to which the advertising and promotional direct mail
53.30is to be delivered to recipients, the seller shall source the sale to the jurisdictions to which
53.31the advertising and promotional direct mail is to be delivered and shall collect and remit
53.32the applicable tax according to the delivery information provided by the purchaser. In
53.33the absence of bad faith, the seller is relieved of any further obligation to collect any
53.34additional tax on any transaction for which the sale of advertising and promotional direct
53.35mail where the seller has collected tax pursuant sourced the sale according to the delivery
53.36information provided by the purchaser.
54.1(b) (e) If the purchaser of direct mail does not have a direct pay permit and does
54.2not provide the seller with either a direct mail form or delivery information, as required
54.3by paragraph (a), the seller shall collect the tax according to any of the items listed in
54.4paragraph (b), the sale shall be sourced under subdivision 2, paragraph (f). Nothing in
54.5this paragraph limits a purchaser's obligation for sales or use tax to any state to which the
54.6direct mail is delivered.
54.7(c) If a purchaser of direct mail provides the seller with documentation of direct
54.8pay authority, the purchaser is not required to provide a direct mail form or delivery
54.9information to the seller.
54.10(f) This subdivision does not apply to printed materials that result from developing
54.11billing information or providing any data processing service that is more than incidental
54.12to producing the printed materials, regardless of whether advertising and promotional
54.13direct mail is included in the same mailing.
54.14(g) If a transaction is a bundled transaction that includes advertising and promotional
54.15direct mail, this subdivision applies only if the primary purpose of the transaction is the sale
54.16of products or services that meet the definition of advertising and promotional direct mail.
54.17EFFECTIVE DATE.This section is effective for sales and purchases made after
54.18June 30, 2011.

54.19    Sec. 6. Minnesota Statutes 2010, section 297A.668, is amended by adding a
54.20subdivision to read:
54.21    Subd. 7a. Other direct mail. (a) Notwithstanding other subdivisions of this section,
54.22the provisions in paragraphs (b) and (c) apply to the sale of other direct mail. "Other direct
54.23mail" means printed material that is direct mail as defined in section 297A.61, subdivision
54.2435, but is not advertising and promotional direct mail as described in subdivision 7,
54.25regardless of whether advertising and promotional direct mail is included in the same
54.26mailing. Other direct mail includes, but is not limited to:
54.27(1) direct mail pertaining to a transaction between the purchaser and addressee,
54.28where the mail contains personal information specific to the addressee including, but not
54.29limited to, invoices, bills, statements of account, and payroll advices;
54.30(2) any legally required mailings including, but not limited to, privacy notices,
54.31tax reports, and stockholder reports; and
54.32(3) other nonpromotional direct mail delivered to existing or former shareholders,
54.33customers, employees, or agents including, but not limited to, newsletters and
54.34informational pieces.
55.1Other direct mail does not include printed materials that result from developing
55.2billing information or providing any data processing service that is more than incidental to
55.3producing the other direct mail.
55.4(b) A purchaser of other direct mail may provide the seller with either a fully
55.5completed exemption certificate as described in section 297A.72 indicating that the
55.6purchaser is authorized to pay any sales or use tax due on purchases made by the purchaser
55.7directly to the commissioner under section 297A.89, or a fully completed exemption
55.8certificate claiming an exemption for direct mail. If the purchaser provides one of the
55.9exemption certificates listed, then the seller, in the absence of bad faith, is relieved of all
55.10obligations to collect, pay, or remit the tax on any transaction involving other direct mail
55.11to which the certificate applies. The purchaser shall source the sale to the jurisdictions to
55.12which the other direct mail is to be delivered to the recipients of the mail, and shall report
55.13and pay any applicable tax due.
55.14(c) If the purchaser does not provide the seller with a fully completed exemption
55.15certificate claiming either exemption listed in paragraph (b), the sale shall be sourced
55.16according to subdivision 2, paragraph (d).
55.17EFFECTIVE DATE.This section is effective for sales and purchases made after
55.18June 30, 2011.

55.19    Sec. 7. Minnesota Statutes 2010, section 297A.71, subdivision 23, is amended to read:
55.20    Subd. 23. Construction materials for qualified low-income housing projects. (a)
55.21Purchases of materials and supplies used or consumed in and equipment incorporated into
55.22the construction, improvement, or expansion of qualified low-income housing projects are
55.23exempt from the tax imposed under this chapter if the owner of the qualified low-income
55.24housing project is:
55.25    (1) the public housing agency or housing and redevelopment authority of a political
55.26subdivision;
55.27    (2) an entity exercising the powers of a housing and redevelopment authority within
55.28a political subdivision;
55.29    (3) a limited partnership in which the sole or managing general partner is an
55.30authority under clause (1) or an entity under clause (2), (4), or (5);
55.31    (4) a nonprofit corporation subject to the provisions of chapter 317A, and qualifying
55.32under section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as amended;
55.33    (5) a limited liability company if it consists of a sole member that is an entity under
55.34clause (4); or
56.1(6) an owner entity, as defined in Code of Federal Regulations, title 24, part 941.604,
56.2for a qualified low-income housing project described in paragraph (b), clause (5).
56.3    This exemption applies regardless of whether the purchases are made by the owner
56.4of the facility or a contractor.
56.5    (b) For purposes of this exemption, "qualified low-income housing project" means:
56.6    (1) a housing or mixed use project in which at least 20 percent of the residential units
56.7are qualifying low-income rental housing units as defined in section 273.126 273.128;
56.8    (2) a federally assisted low-income housing project financed by a mortgage insured
56.9or held by the United States Department of Housing and Urban Development under
56.10United States Code, title 12, section 1701s, 1715l(d)(3), 1715l(d)(4), or 1715z-1; United
56.11States Code, title 42, section 1437f; the Native American Housing Assistance and
56.12Self-Determination Act, United States Code, title 25, section 4101 et seq.; or any similar
56.13successor federal low-income housing program;
56.14    (3) a qualified low-income housing project as defined in United States Code, title
56.1526, section 42(g), meeting all of the requirements for a low-income housing credit under
56.16section 42 of the Internal Revenue Code regardless of whether the project actually applies
56.17for or receives a low-income housing credit;
56.18    (4) a project that will be operated in compliance with Internal Revenue Service
56.19revenue procedure 96-32; or
56.20    (5) a housing or mixed use project in which all or a portion of the residential units
56.21are subject to the requirements of section 5 of the United States Housing Act of 1937.
56.22    (c) For a project, a portion of which is not used for low-income housing units,
56.23the amount of purchases that are exempt under this subdivision must be determined by
56.24multiplying the total purchases, as specified in paragraph (a), by the ratio of:
56.25    (1) the total gross square footage of units subject to the income limits under section
56.26273.126 273.128, the financing for the project, the federal low-income housing tax credit,
56.27revenue procedure 96-32, or section 5 of the United States Housing Act of 1937, as
56.28applicable to the project; and
56.29    (2) the total gross square footage of all units in the project.
56.30    (d) The tax must be imposed and collected as if the rate under section 297A.62,
56.31subdivision 1 , applied, and then refunded in the manner provided in section 297A.75.
56.32EFFECTIVE DATE.This section is effective the day following final enactment.

56.33    Sec. 8. Minnesota Statutes 2010, section 297A.89, subdivision 2, is amended to read:
56.34    Subd. 2. Retailer does not collect. The retailer shall not collect the tax from a
56.35purchaser who furnishes to the retailer a copy of a fully completed exemption certificate
57.1issued by the commissioner authorizing as described in section 297A.72, indicating that
57.2the purchaser is authorized to pay any sales or use tax due on purchases made by the
57.3purchaser directly to the commissioner under subdivision 1.
57.4EFFECTIVE DATE.This section is effective the day following final enactment.

57.5    Sec. 9. Minnesota Statutes 2010, section 297B.08, is amended to read:
57.6297B.08 TAX PAID IN OTHER STATE; CREDIT, RECIPROCITY.
57.7If any motor vehicle has been or is subject to a tax by any other state in respect to
57.8its sale or use, in an amount less than the tax imposed by this chapter and chapter 297A,
57.9the provisions of this chapter and chapter 297A, shall apply, but at a rate measured by
57.10the difference only between the rate fixed in this chapter 297A, and the rate by which the
57.11previous tax paid in the other state upon the sale or use was computed. If the rate of
57.12tax imposed in such other state is the same or more than the rate of tax imposed by this
57.13chapter 297A, then no tax shall be due on such motor vehicle. The provisions of this
57.14section shall apply only if such other state allows a credit with respect to the excise tax
57.15imposed by this chapter and chapter 297A, which is substantially similar in effect to
57.16the credit allowed by this section.
57.17EFFECTIVE DATE.This section is effective the day following final enactment.

57.18    Sec. 10. Laws 1986, chapter 462, section 31, as amended by Laws 1991, chapter 291,
57.19article 8, section 24, is amended to read:
57.20    Sec. 31. AUTHORITY FOR TAXATION.
57.21    Notwithstanding Minnesota Statutes, section 477A.016, or any other law, and
57.22supplemental to the tax imposed by Laws 1982, chapter 523, article 25, section 1, the city
57.23of St. Paul may impose, by ordinance, a tax, at a rate not greater than three percent, on the
57.24gross receipts from the furnishing for consideration of lodging and related services at a
57.25hotel, rooming house, tourist court, motel, or resort, other than the renting or leasing of
57.26space for a continuous period of 30 days or more. The tax does not apply to the furnishing
57.27of lodging and related services by a business having less than 50 lodging rooms. The tax
57.28shall be collected by and its proceeds paid to the city. Ninety-five percent of the revenues
57.29generated by this tax shall be used to fund a convention bureau to market and promote
57.30the city as a tourist or convention center.
57.31EFFECTIVE DATE.This section is effective for sales and purchases made after
57.32June 30, 2011.


58.3    Section 1. Minnesota Statutes 2010, section 296A.083, is amended by adding a
58.4subdivision to read:
58.5    Subd. 4. Apportionment. The surcharge under this section is subject to the
58.6apportionment provisions of section 296A.18.
58.7EFFECTIVE DATE.This section is effective the day following final enactment.

58.8    Sec. 2. Minnesota Statutes 2010, section 296A.18, is amended by adding a subdivision
58.9to read:
58.10    Subd. 6a. Computation of nonhighway use amounts. The nonhighway use
58.11amounts determined in subdivisions 2 to 6 must be transferred from the highway user tax
58.12distribution fund to the accounts as provided for in sections 84.794, 84.803, 84.83, 84.927,
58.13and 86B.706. These amounts, together with interest and penalties for delinquency in
58.14payment, paid or collected pursuant to the provisions of this chapter, must be computed
58.15for each six-month period ending June 30 and December 31 and must be transferred on
58.16November 1 and June 1 following each six-month period.
58.17EFFECTIVE DATE.This section is effective the day following final enactment.

58.18    Sec. 3. Minnesota Statutes 2010, section 296A.18, subdivision 7, is amended to read:
58.19    Subd. 7. Forest road. Approximately 0.116 percent of the total annual unrefunded
58.20revenue from the gasoline fuel tax on all gasoline and special fuel received in, produced,
58.21or brought into this state, except gasoline and special fuel used for aviation purposes, is
58.22derived from the operation of motor vehicles on state forest roads and county forest access
58.23roads. This revenue, together with interest and penalties for delinquency in payment, paid
58.24or collected pursuant to the provisions of this chapter, is appropriated from the highway
58.25user tax distribution fund and must be transferred and credited in equal installments on
58.26July 1 and January 1 to the state forest road account established in section 89.70. Of this
58.27amount, 0.0605 percent is annually derived from motor vehicles operated on state forest
58.28roads and 0.0555 percent is annually derived from motor vehicles operated on county
58.29forest access roads in this state. An amount equal to 0.0555 percent of the unrefunded
58.30revenue must be annually transferred to counties for the management and maintenance of
58.31county forest roads.
58.32EFFECTIVE DATE.This section is effective the day following final enactment.

59.1    Sec. 4. Minnesota Statutes 2010, section 297I.15, is amended by adding a subdivision
59.2to read:
59.3    Subd. 12. Federal Employees Health Benefits Program. Premiums received
59.4under the Federal Employees Health Benefits Act, United States Code, title 5, section
59.58909(f), as amended by the Omnibus Reconciliation Act of 1990, are exempt from the
59.6taxes and surcharges imposed under this chapter.
59.7EFFECTIVE DATE.This section is effective the day following final enactment.

59.8    Sec. 5. Minnesota Statutes 2010, section 298.28, subdivision 2, is amended to read:
59.9    Subd. 2. City or town where quarried or produced. (a) 4.5 cents per gross ton of
59.10merchantable iron ore concentrate, hereinafter referred to as "taxable ton," plus the amount
59.11provided in paragraph (c), must be allocated to the city or town in the county in which
59.12the lands from which taconite was mined or quarried were located or within which the
59.13concentrate was produced. If the mining, quarrying, and concentration, or different steps
59.14in either thereof are carried on in more than one taxing district, the commissioner shall
59.15apportion equitably the proceeds of the part of the tax going to cities and towns among
59.16such subdivisions upon the basis of attributing 50 percent of the proceeds of the tax to
59.17the operation of mining or quarrying the taconite, and the remainder to the concentrating
59.18plant and to the processes of concentration, and with respect to each thereof giving due
59.19consideration to the relative extent of such operations performed in each such taxing
59.20district. The commissioner's order making such apportionment shall be subject to review
59.21by the Tax Court at the instance of any of the interested taxing districts, in the same
59.22manner as other orders of the commissioner.
59.23(b) Four cents per taxable ton shall be allocated to cities and organized townships
59.24affected by mining because their boundaries are within three miles of a taconite mine pit
59.25that has been actively mined in at least one of the prior three years. If a city or town is
59.26located near more than one mine meeting these criteria, the city or town is eligible to
59.27receive aid calculated from only the mine producing the largest taxable tonnage. When
59.28more than one municipality qualifies for aid based on one company's production, the aid
59.29must be apportioned among the municipalities in proportion to their populations. Of the
59.30amounts distributed under this paragraph to each municipality, one-half must be used for
59.31infrastructure improvement projects, and one-half must be used for projects in which two
59.32or more municipalities cooperate. Each municipality that receives a distribution under this
59.33paragraph must report annually to the Iron Range Resources and Rehabilitation Board and
59.34the commissioner of Iron Range resources and rehabilitation on the projects involving
59.35cooperation with other municipalities.
60.1(c) The amount that would have been computed for the current year under Minnesota
60.2Statutes 2008, section 126C.21, subdivision 4, for a school district within which the
60.3taconite was mined or quarried or within which the concentrate is produced is added to
60.4the amount to be distributed to the cities and towns located within that school district as
60.5provided in paragraph (a) shall be distributed to the cities and townships within the school
60.6district in the proportion that their taxable net tax capacity within the school district bears
60.7to the taxable net tax capacity of the school district for property taxes payable in the
60.8year prior to distribution.
60.9EFFECTIVE DATE.This section is effective the day following final enactment.

60.10    Sec. 6. REPEALER.
60.11Minnesota Statutes 2010, section 296A.18, subdivision 9, is repealed.
60.12EFFECTIVE DATE.This section is effective the day following final enactment.


60.15    Section 1. Minnesota Statutes 2010, section 69.031, subdivision 1, is amended to read:
60.16    Subdivision 1. Commissioner's warrant. (a) The commissioner of management
60.17and budget shall issue to the Public Employees Retirement Association on behalf of
60.18a municipality or independent nonprofit firefighting corporation that is a member of the
60.19voluntary statewide lump-sum volunteer firefighter retirement plan under chapter 353G
60.20or to the county, municipality, or independent nonprofit firefighting corporation certified
60.21to the commissioner of management and budget by the commissioner a warrant for an
60.22amount equal to the amount of fire state aid or police state aid, whichever applies, certified
60.23for the applicable state aid recipient by the commissioner under section 69.021.
60.24(b) The amount of state aid due and not paid by October 1 accrues interest at the rate
60.25of one percent for each month or part of a month the amount remains unpaid, beginning
60.26the preceding July 1 after October 1.
60.27EFFECTIVE DATE.This section is effective the day following final enactment.

60.28    Sec. 2. Minnesota Statutes 2010, section 116J.8737, subdivision 1, is amended to read:
60.29    Subdivision 1. Definitions. (a) For the purposes of this section, the following terms
60.30have the meanings given.
60.31(b) "Qualified small business" means a business that has been certified by the
60.32commissioner under subdivision 2.
61.1(c) "Qualified investor" means an investor who has been certified by the
61.2commissioner under subdivision 3.
61.3(d) "Qualified fund" means a pooled angel investment network fund that has been
61.4certified by the commissioner under subdivision 4.
61.5(e) "Qualified investment" means a cash investment in a qualified small business
61.6of a minimum of:
61.7(1) $10,000 in a calendar year by a qualified investor; or
61.8(2) $30,000 in a calendar year by a qualified fund.
61.9A qualified investment must be made in exchange for common stock, a partnership
61.10or membership interest, preferred stock, debt with mandatory conversion to equity, or an
61.11equivalent ownership interest as determined by the commissioner.
61.12(f) "Family" means a family member within the meaning of the Internal Revenue
61.13Code, section 267(c)(4).
61.14(g) "Pass-through entity" means a corporation that for the applicable taxable year is
61.15treated as an S corporation or a general partnership, limited partnership, limited liability
61.16partnership, trust, or limited liability company and which for the applicable taxable year is
61.17not taxed as a corporation under chapter 290.
61.18(h) "Intern" means a student of an accredited institution of higher education, or a
61.19former student who has graduated in the past six months from an accredited institution
61.20of higher education, who is employed by a qualified small business in a nonpermanent
61.21position for a duration of nine months or less that provides training and experience in the
61.22primary business activity of the business.
61.23EFFECTIVE DATE.This section is effective retroactively from January 1, 2011.

61.24    Sec. 3. Minnesota Statutes 2010, section 116J.8737, subdivision 2, is amended to read:
61.25    Subd. 2. Certification of qualified small businesses. (a) Businesses may apply
61.26to the commissioner for certification as a qualified small business for a calendar year.
61.27The application must be in the form and be made under the procedures specified by the
61.28commissioner, accompanied by an application fee of $150. Application fees are deposited
61.29in the small business investment tax credit administration account in the special revenue
61.30fund. The application for certification for 2010 must be made available on the department's
61.31Web site by August 1, 2010. Applications for subsequent years' certification must be made
61.32available on the department's Web site by November 1 of the preceding year.
61.33(b) Within 30 days of receiving an application for certification under this subdivision,
61.34the commissioner must either certify the business as satisfying the conditions required of a
61.35qualified small business, request additional information from the business, or reject the
62.1application for certification. If the commissioner requests additional information from the
62.2business, the commissioner must either certify the business or reject the application within
62.330 days of receiving the additional information. If the commissioner neither certifies the
62.4business nor rejects the application within 30 days of receiving the original application or
62.5within 30 days of receiving the additional information requested, whichever is later, then
62.6the application is deemed rejected, and the commissioner must refund the $150 application
62.7fee. A business that applies for certification and is rejected may reapply.
62.8(c) To receive certification, a business must satisfy all of the following conditions:
62.9(1) the business has its headquarters in Minnesota;
62.10(2) at least 51 percent of the business's employees are employed in Minnesota, and
62.1151 percent of the business's total payroll is paid or incurred in the state;
62.12(3) the business is engaged in, or is committed to engage in, innovation in Minnesota
62.13in one of the following as its primary business activity:
62.14(i) using proprietary technology to add value to a product, process, or service in a
62.15qualified high-technology field;
62.16(ii) researching or developing a proprietary product, process, or service in a qualified
62.17high-technology field; or
62.18(iii) researching, developing, or producing a new proprietary technology for use in
62.19the fields of agriculture, tourism, forestry, mining, manufacturing, or transportation;
62.20(4) other than the activities specifically listed in clause (3), the business is not
62.21engaged in real estate development, insurance, banking, lending, lobbying, political
62.22consulting, information technology consulting, wholesale or retail trade, leisure,
62.23hospitality, transportation, construction, ethanol production from corn, or professional
62.24services provided by attorneys, accountants, business consultants, physicians, or health
62.25care consultants;
62.26(5) the business has fewer than 25 employees;
62.27(6) the business must pay its employees annual wages of at least 175 percent of the
62.28federal poverty guideline for the year for a family of four and must pay its interns annual
62.29wages of at least 175 percent of the federal minimum wage used for federally covered
62.30employers, except that this requirement must be reduced proportionately for employees
62.31and interns who work less than full-time, and does not apply to an executive, officer, or
62.32member of the board of the business, or to any employee who owns, controls, or holds
62.33power to vote more than 20 percent of the outstanding securities of the business;
62.34(7) the business has not been in operation for more than ten years;
62.35(8) the business has not previously received private equity investments of more
62.36than $2,000,000 $4,000,000; and
63.1    (9) the business is not an entity disqualified under section 80A.50, paragraph (b),
63.2clause (3).
63.3(d) In applying the limit under paragraph (c), clause (5), the employees in all
63.4members of the unitary business, as defined in section 290.17, subdivision 4, must be
63.5included.
63.6(e) In order for a qualified investment in a business to be eligible for tax credits, the
63.7business must have applied for and received certification for the calendar year in which
63.8the investment was made prior to the date on which the qualified investment was made.
63.9(f) The commissioner must maintain a list of businesses certified under this
63.10subdivision for the calendar year and make the list accessible to the public on the
63.11department's Web site.
63.12(g) For purposes of this subdivision, the following terms have the meanings given:
63.13(1) "qualified high-technology field" includes aerospace, agricultural processing,
63.14renewable energy, energy efficiency and conservation, environmental engineering, food
63.15technology, cellulosic ethanol, information technology, materials science technology,
63.16nanotechnology, telecommunications, biotechnology, medical device products,
63.17pharmaceuticals, diagnostics, biologicals, chemistry, veterinary science, and similar
63.18fields; and
63.19(2) "proprietary technology" means the technical innovations that are unique and
63.20legally owned or licensed by a business and includes, without limitation, those innovations
63.21that are patented, patent pending, a subject of trade secrets, or copyrighted.
63.22EFFECTIVE DATE.This section is effective retroactively from January 1, 2011.

63.23    Sec. 4. Minnesota Statutes 2010, section 116J.8737, subdivision 4, is amended to read:
63.24    Subd. 4. Certification of qualified funds. (a) A pass-through entity may apply to
63.25the commissioner for certification as a qualified fund for a calendar year. The application
63.26must be in the form and be made under the procedures specified by the commissioner,
63.27accompanied by an application fee of $1,000. Application fees are deposited in the small
63.28business investment tax credit administration account in the special revenue fund. The
63.29application for certification for 2010 of qualified funds must be made available on the
63.30department's Web site by August 1, 2010. Applications for subsequent years' certification
63.31must be made available by November 1 of the preceding year.
63.32(b) Within 30 days of receiving an application for certification under this subdivision,
63.33the commissioner must either certify the fund as satisfying the conditions required of a
63.34qualified fund, request additional information from the fund, or reject the application
63.35for certification. If the commissioner requests additional information from the fund,
64.1the commissioner must either certify the fund or reject the application within 30 days
64.2of receiving the additional information. If the commissioner neither certifies the fund
64.3nor rejects the application within 30 days of receiving the original application or within
64.430 days of receiving the additional information requested, whichever is later, then the
64.5application is deemed rejected, and the commissioner must refund the $1,000 application
64.6fee. A fund that applies for certification and is rejected may reapply.
64.7(c) To receive certification, a fund must:
64.8(1) invest or intend to invest in qualified small businesses;
64.9(2) be organized as a pass-through entity; and
64.10(3) have at least three separate investors, all of whom at least three whose investment
64.11is made in the certified business and who seek a tax credit allocation satisfy the conditions
64.12in subdivision 3, paragraph (c).
64.13(d) Investments in the fund may consist of equity investments or notes that pay
64.14interest or other fixed amounts, or any combination of both.
64.15(e) In order for a qualified investment in a qualified small business to be eligible for
64.16tax credits, a qualified fund that makes the investment must have applied for and received
64.17certification for the calendar year prior to making the qualified investment.
64.18EFFECTIVE DATE.This section is effective retroactively from January 1, 2011.

64.19    Sec. 5. Minnesota Statutes 2010, section 270A.03, subdivision 7, is amended to read:
64.20    Subd. 7. Refund. "Refund" means an individual income tax refund or political
64.21contribution refund, pursuant to chapter 290, or a property tax credit or refund, pursuant to
64.22chapter 290A, or a sustainable forest tax payment to a claimant under chapter 290C.
64.23For purposes of this chapter, lottery prizes, as set forth in section 349A.08,
64.24subdivision 8 , and amounts granted to persons by the legislature on the recommendation
64.25of the joint senate-house of representatives Subcommittee on Claims shall be treated
64.26as refunds.
64.27In the case of a joint property tax refund payable to spouses under chapter 290A,
64.28the refund shall be considered as belonging to each spouse in the proportion of the total
64.29refund that equals each spouse's proportion of the total income determined under section
64.30290A.03, subdivision 3 . In the case of a joint income tax refund under chapter 289A, the
64.31refund shall be considered as belonging to each spouse in the proportion of the total
64.32refund that equals each spouse's proportion of the total taxable income determined under
64.33section 290.01, subdivision 29. The commissioner shall remit the entire refund to the
64.34claimant agency, which shall, upon the request of the spouse who does not owe the debt,
64.35determine the amount of the refund belonging to that spouse and refund the amount to
65.1that spouse. For court fines, fees, and surcharges and court-ordered restitution under
65.2section 611A.04, subdivision 2, the notice provided by the commissioner of revenue under
65.3section 270A.07, subdivision 2, paragraph (b), serves as the appropriate legal notice
65.4to the spouse who does not owe the debt.
65.5EFFECTIVE DATE.This section is effective the day following final enactment.

65.6    Sec. 6. [270C.101] APPLICATION FOR BUSINESS REGISTRATION;
65.7CERTAIN INFORMATION NOT REQUIRED.
65.8Notwithstanding any law to the contrary, an entity applying for a Minnesota business
65.9tax account number is not required to list the names, home addresses, and Social Security
65.10numbers of its officers or directors when the entity applying for an account number is an
65.11instrumentality of a state, a local, or the federal government, or a tribal government.
65.12EFFECTIVE DATE.This section is effective the day following final enactment.

65.13    Sec. 7. Minnesota Statutes 2010, section 270C.13, subdivision 2, is amended to read:
65.14    Subd. 2. Bill analyses. (a) At the request of the chair of the house of representatives
65.15Tax Committee or the senate Committee on Taxes and Tax Laws, the commissioner shall
65.16prepare an incidence impact analysis of a bill or a proposal to change the tax system which
65.17increases, decreases, or redistributes taxes by more than $20,000,000. To the extent data
65.18is available on the changes in the distribution of the tax burden that are affected by the
65.19bill or proposal, the analysis shall report on the incidence effects that would result if the
65.20bill were enacted. The report may present information using systemwide measures, such
65.21as Suits or other similar indexes, by income classes, taxpayer characteristics, or other
65.22relevant categories. The report may include analyses of the effect of the bill or proposal
65.23on representative taxpayers. The analysis must include a statement of the incidence
65.24assumptions that were used in computing the burdens.
65.25(b) The commissioner shall notify the chairs of the house of representatives and
65.26senate committees with primary jurisdiction over taxation when the commissioner
65.27receives a request to prepare an analysis of the type described under paragraph (a) and
65.28the commissioner has determined to prepare the analysis.
65.29EFFECTIVE DATE.This section is effective the day following final enactment.

65.30    Sec. 8. Minnesota Statutes 2010, section 270C.30, is amended to read:
65.31270C.30 RETURNS AND OTHER DOCUMENTS; FORMAT; FURNISHING.
66.1The commissioner shall prescribe the content and format of all returns and other
66.2forms required to be filed under a law administered by the commissioner, and may furnish
66.3them subject to charge on application.
66.4EFFECTIVE DATE.This section is effective the day following final enactment.

66.5    Sec. 9. [270C.301] ROUNDING OF DOLLAR AMOUNTS REPORTED ON
66.6TAX FORMS.
66.7Where not otherwise provided by law, in computing the dollar amount of items
66.8reported on any return or other document, and accompanying schedules, filed with the
66.9commissioner, money items may, in the discretion of the commissioner, be rounded off to
66.10the nearest whole dollar amount, disregarding amounts less than 50 cents and increasing
66.11amounts of 50 cents to 99 cents to the next highest dollar.
66.12EFFECTIVE DATE.This section is effective the day following final enactment.

66.13    Sec. 10. Minnesota Statutes 2010, section 270C.32, subdivision 3, is amended to read:
66.14    Subd. 3. Third-party subpoena where taxpayer's identity is known. (a) An
66.15examination or investigation may extend to a person that the commissioner determines has
66.16access to information that may be relevant to the examination or investigation. When a
66.17subpoena requiring the production of records as described in subdivision 1 is served on a
66.18third-party record keeper, written notice of the subpoena must be mailed to the taxpayer
66.19and to any other person who is identified in the subpoena. The notices must be given
66.20within three days of the day on which the subpoena is served. The notice required by this
66.21subdivision is sufficient if it is mailed to the last known address of the addressee.
66.22(b) The provisions of this subdivision regarding notice to the taxpayer or other
66.23parties identified in the subpoena do not apply if there is reasonable cause to believe
66.24that the giving of notice may lead to attempts to conceal, destroy, or alter records or
66.25assets relevant to the examination, to prevent the communication of information from
66.26other persons through intimidation, bribery, or collusion, or to flee to avoid prosecution,
66.27testifying, or production of records. Notice is not required under this subdivision or under
66.28another law if the taxpayer or other parties identified in the subpoena are under criminal
66.29investigation, and the subpoena has been issued as part of the criminal investigation.
66.30(c) A third-party record keeper who is advised that a subpoena has been issued as
66.31part of a criminal investigation is prohibited from informing by any means the taxpayer
66.32or other parties identified in the subpoena of the receipt of the subpoena, the contents of
67.1the subpoena, or the fact that the taxpayer or other parties identified may be or are under
67.2criminal investigation.
67.3EFFECTIVE DATE.This section is effective for subpoenas served after the day
67.4following final enactment.

67.5    Sec. 11. Minnesota Statutes 2010, section 270C.32, is amended by adding a subdivision
67.6to read:
67.7    Subd. 11. Service of subpoenas. A subpoena authorized by this section may be
67.8served by mail or delivery.
67.9EFFECTIVE DATE.This section is effective the day following final enactment.

67.10    Sec. 12. Minnesota Statutes 2010, section 270C.64, is amended to read:
67.11270C.64 CREDIT OF OVERPAYMENT OR PAYMENT TO DELINQUENT
67.12TAX LIABILITIES.
67.13Notwithstanding any other provision of law to the contrary, in the case of an
67.14overpayment of any tax collected by the commissioner, or any refund, credit, claim, or
67.15other payment payable by the commissioner to any person under a law administered by the
67.16commissioner, the commissioner may credit the amount of such overpayment or payment
67.17against any uncontested delinquent tax liability on the part of the taxpayer person who
67.18made is entitled to the overpayment or payment. An overpayment or payment may be
67.19credited under this section only if the uncontested delinquent liability has been assessed
67.20within ten years of the date on which the overpayment or payment is credited. However,
67.21this limitation shall not be applicable if the delinquent liability has been entered into
67.22judgment or if legal action is pending for collection of the liability or for renewal of the
67.23judgment. An amount paid as tax shall constitute an overpayment even if in fact there was
67.24no tax liability with respect to which such amount was paid.
67.25EFFECTIVE DATE.This section is effective for liabilities becoming delinquent
67.26after the day of final enactment.

67.27    Sec. 13. Minnesota Statutes 2010, section 270C.7101, subdivision 2, is amended to
67.28read:
67.29    Subd. 2. Notice of sale. The commissioner shall as soon as practicable after the
67.30seizure of the property give notice of sale of the property to the owner, in the manner of
67.31service prescribed in subdivision 1. In the case of personal property, the notice shall be
68.1served at least ten days prior to the sale. In the case of real property, the notice shall be
68.2served at least four weeks prior to the sale. The commissioner shall also cause public
68.3notice of each sale to be made. In the case of personal property, notice shall be posted
68.4at least ten days prior to the sale at the county courthouse for the county where the
68.5seizure is made, and in not less than two other in not less than three public places. For
68.6purposes of this requirement, the Internet is a public place for posting the information. In
68.7the case of real property, six weeks' published notice shall be given prior to the sale, in a
68.8newspaper published or generally circulated in the county. The notice of sale provided
68.9in this subdivision shall specify the property to be sold, and the time, place, manner,
68.10and conditions of the sale. Whenever levy is made without regard to the 30-day period
68.11provided in section 270C.67, subdivision 3, public notice of sale of the property seized
68.12shall not be made within the 30-day period unless section 270C.7102 (relating to sale of
68.13perishable goods) is applicable.
68.14EFFECTIVE DATE.This section is effective for seizures begun on or after the
68.15day following final enactment.

68.16    Sec. 14. Minnesota Statutes 2010, section 270C.711, is amended to read:
68.17270C.711 ACQUISITION AND RESALE OF SEIZED PROPERTY.
68.18For the purpose of enabling the commissioner to purchase or redeem seized property
68.19in which the state of Minnesota has an interest arising from a lien for unpaid taxes, or
68.20to provide for the operating costs of collection activities of the department, there is
68.21appropriated to the commissioner an amount representing the cost of such purchases,
68.22redemptions, or collection activities. Seized property acquired by the state of Minnesota
68.23to satisfy unpaid taxes shall be resold by the commissioner. The commissioner shall
68.24preserve the value of seized property while controlling it, including but not limited to
68.25the procurement of insurance. For the purpose of refunding the proceeds from the sale
68.26of levied or redeemed property which are in excess of the actual tax liability plus costs
68.27of acquiring the property, there is hereby created a levied and redeemed property refund
68.28account in the agency fund. All amounts deposited into this account are appropriated to
68.29the commissioner. The commissioner shall report quarterly annually on the status of this
68.30program to the chairs and ranking minority members of the house of representatives
68.31taxes and Ways and Means Committees and senate Taxes and Tax Laws and Finance
68.32Committees legislative committees having jurisdiction over taxes and finance of the house
68.33of representatives and senate.
68.34EFFECTIVE DATE.This section is effective the day following final enactment.

69.1    Sec. 15. Minnesota Statutes 2010, section 287.05, subdivision 2, is amended to read:
69.2    Subd. 2. Supplemental mortgages. (a) Except for an amendment or a revision to a
69.3reverse mortgage as described under subdivision 6, any document that alters an existing
69.4mortgage by providing for an increase in the amount of debt secured by real property
69.5located in this state, or, in the case of a multistate mortgage described in subdivision 1,
69.6paragraph (b), an increase in the percentage of Minnesota real estate as compared to
69.7the total real estate that is encumbered by the mortgage, shall be taxed based upon the
69.8increase in the amount of the debt determined to be secured by real property located in
69.9this state under either subdivision 1 or 1a.
69.10(b) Except as provided in subdivision 3, any document that alters an existing
69.11mortgage to secure debt that was (i) advanced, (ii) repaid in whole or in part, and (iii) then
69.12readvanced in whole or in part, shall be taxed based upon the new amounts advanced, even
69.13if the maximum debt previously secured by the mortgage is not exceeded.
69.14EFFECTIVE DATE.This section is effective the day following final enactment.

69.15    Sec. 16. Minnesota Statutes 2010, section 469.319, subdivision 5, is amended to read:
69.16    Subd. 5. Waiver authority. (a) The commissioner may waive all or part of a
69.17repayment required under subdivision 1, if the commissioner, in consultation with
69.18the commissioner of employment and economic development and appropriate officials
69.19from the local government units in which the qualified business is located, determines
69.20that requiring repayment of the tax is not in the best interest of the state or the local
69.21government units and the business ceased operating as a result of circumstances beyond
69.22its control including, but not limited to:
69.23    (1) a natural disaster;
69.24    (2) unforeseen industry trends; or
69.25    (3) loss of a major supplier or customer.
69.26    (b)(1) The commissioner shall waive repayment required under subdivision 1a if
69.27the commissioner has waived repayment by the operating business under subdivision 1,
69.28unless the person that received benefits without having to operate a business in the zone
69.29was a contributing factor in the qualified business becoming subject to repayment under
69.30subdivision 1;
69.31    (2) the commissioner shall waive the repayment required under subdivision 1a, even
69.32if the repayment has not been waived for the operating business if:
69.33    (i) the person that received benefits without having to operate a business in the zone
69.34and the business that operated in the zone are not related parties as defined in section
69.35267(b) of the Internal Revenue Code of 1986, as amended through December 31, 2007; and
70.1    (ii) actions of the person were not a contributing factor in the qualified business
70.2becoming subject to repayment under subdivision 1.
70.3(c) Requests for waiver must be made no later than 60 days after the earlier of
70.4the notice date of an order issued under subdivision 4, paragraph (d), or, in the case of
70.5property taxes, within 60 days of the date of a tax statement issued under subdivision 4,
70.6paragraph (c).
70.7EFFECTIVE DATE.This section is effective for waivers requested in response
70.8to notices issued after the day following final enactment.

70.9    Sec. 17. CITY OF SAUK RAPIDS TAX INCREMENT FINANCING DISTRICT;
70.10INCLUSION OF PARCELS.
70.11Minnesota Statutes, section 469.176, subdivision 7, that restricts inclusion of parcels
70.12qualifying under Minnesota Statutes, section 273.111, in a tax increment financing district,
70.13does not apply to parcels located in the city of Sauk Rapids with the following parcel
70.14identification numbers: 19.04173.00, 19.04174.00, and 19.04176.00, if these parcels
70.15have been withdrawn from the program under Minnesota Statutes, section 273.111, by
70.16June 30, 2011.
70.17EFFECTIVE DATE.This act is effective the day following final enactment after
70.18compliance by the governing body of the city of Sauk Rapids with the requirements of
70.19Minnesota Statutes, section 645.021, subdivision 3.

70.20    Sec. 18. REPEALER.
70.21Minnesota Statutes 2010, sections 290.06, subdivision 10; and 290A.27, are repealed.
70.22EFFECTIVE DATE.This section is effective the day following final enactment."
70.23Delete the title and insert:
70.25relating to taxation; omnibus policy bill; making policy, technical, administrative,
70.26and clarifying changes to income, withholding, estate, property, sales and use,
70.27mortgage registry, lodging, insurance, minerals, gasoline, and other various taxes
70.28and tax-related provisions; making changes to provisions related to certain
70.29aids, delinquent tax liabilities, and tax-forfeited lands;amending Minnesota
70.30Statutes 2010, sections 69.031, subdivision 1; 116J.8737, subdivisions 1, 2, 4;
70.31270.87; 270A.03, subdivision 7; 270C.13, subdivision 2; 270C.30; 270C.32,
70.32subdivision 3, by adding a subdivision; 270C.34, subdivision 1; 270C.64;
70.33270C.7101, subdivision 2; 270C.711; 272.029, by adding a subdivision;
70.34273.1231, subdivision 4; 273.124, subdivisions 1, 8, 14; 273.13, subdivisions
70.3522, 23; 273.33, subdivision 2; 273.37, subdivision 2; 273.3711; 274.175;
70.36278.05, subdivision 6; 282.01, subdivisions 1a, 1c, 1d; 282.014; 282.12; 287.05,
70.37subdivision 2; 289A.08, subdivisions 1, 7; 289A.12, by adding a subdivision;
70.38289A.18, subdivision 3; 289A.25, subdivisions 1, 6, by adding a subdivision;
71.1289A.26, subdivision 1; 289A.35; 289A.50, subdivision 10; 289A.60,
71.2subdivision 31; 290.01, subdivisions 19a, 19b; 290.06, subdivision 2c; 290.091,
71.3subdivision 2; 290.0922, subdivisions 2, 3; 290.095, subdivision 11; 290.92,
71.4subdivision 26; 291.03, subdivision 1b; 296A.083, by adding a subdivision;
71.5296A.18, subdivision 7, by adding a subdivision; 297A.61, subdivision 3;
71.6297A.62, by adding a subdivision; 297A.63, by adding a subdivision; 297A.668,
71.7subdivision 7, by adding a subdivision; 297A.71, subdivision 23; 297A.89,
71.8subdivision 2; 297B.08; 297I.15, by adding a subdivision; 298.28, subdivision
71.92; 469.319, subdivision 5; Laws 1986, chapter 462, section 31, as amended;
71.10Laws 2010, chapter 389, article 1, section 12; proposing coding for new law in
71.11Minnesota Statutes, chapter 270C; repealing Minnesota Statutes 2010, sections
71.12272.02, subdivision 34; 273.124, subdivision 10; 281.37; 290.06, subdivision
71.1310; 290A.27; 296A.18, subdivision 9."