Chief warns tax bill delay has consequences

Published 9:29 am Wednesday, March 19, 2014

ST. PAUL — Minnesota Revenue Commissioner Myron Frans said Tuesday his agency is fast approaching an internal deadline for alerting income tax preparers and software vendors of new tax breaks that filers might qualify for this year.

He delivered a warning because lawmakers haven’t passed a tax relief measure with the extra deductions and exemptions that can be claimed on 2013 taxes.

“Every day they wait puts in jeopardy the ability to get these tax changes done for folks,” Frans told The Associated Press in a phone interview. “If we don’t get this done this week, then we’re putting in the potential that none of this gets done until after April 15.”

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Frans said his department and private programmers are reluctant to make any changes to filing systems just before or after April 1 because of a surge in filings from that point until the tax deadline. An estimated 1.1 million filers will submit returns from April 1 on.

With the help of a $1.2 billion surplus, Minnesota lawmakers are weighing the tax credits that would come by aligning the state tax code with one at the federal level. Some but not all of the exemptions and deductions would be retroactive to the 2013 tax year.

The changes affect hundreds of thousands of filers. For example, about 280,000 recent college graduates would qualify for deduction of student loan interest and another 40,000 students and their parents could access tuition deductions. There are 96,000 filers who could be in line for a mortgage insurance deduction.

If lawmakers wait, Frans said some people would have the option of filing amended returns or foregoing the money if the payoff isn’t worth the time or expense. The department would attempt to provide automatic rebates where it can, but Frans said such outreach isn’t guaranteed in all cases.

The House approved its version of the tax measure in early March.

The Senate was crafting a plan this week. If the two bills differ, it could require a House-Senate conference committee to sort out differences, delaying the final outcome.

Senate Taxes Committee Chairman Rod Skoe, DFL-Clearbrook, said he’s more worried about making the right decisions than doing something quickly.

“We’re going to be in good order for April 1st,” Skoe said as he was told of Frans’ urgency. He added with a good-natured grin: “Tell him to chill.”