HF 4974

03/25/26   REVISOR  EAP/BH  26-08248
This Document can be made available
in alternative formats upon request  State of Minnesota
  HOUSE OF REPRESENTATIVES
  NINETY-FOURTH SESSION
  H. F. No.    4974
04/16/2026     Authored by Lee, K.; Coulter and Gottfried
  The bill was read for the first time and referred to the Committee on Taxes
1.1A bill for an act
1.2relating to taxation; income and property tax refunds; reducing homestead credit
1.3refund co-pays; authorizing the commissioner of revenue to implement a tax
1.4compliance program; appropriating money; amending Minnesota Statutes 2024,
1.5section 290A.04, subdivisions 2, 4.
1.6BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.7Section 1. Minnesota Statutes 2024, section 290A.04, subdivision 2, is amended to read:
1.8Subd. 2. Homeowners; homestead credit refund. A claimant whose property taxes
1.9payable are in excess of the percentage of the household income stated below shall pay an
1.10amount equal to the percent of income shown for the appropriate household income level
1.11along with the percent to be paid by the claimant of the remaining amount of property taxes
1.12payable. The state refund equals the amount of property taxes payable that remain, up to
1.13the state refund amount shown below.
1.14Maximum
1.15Percent Paid by  State
1.16Household Income  Percent of Income  Claimant  Refund
1.17$0 to 2,079  12  3,310
1.182,249  1.0 percent  7 percent  $ 3,580
1.192,080 to 4,139  12  3,310
1.202,250 to 4,469  1.1 percent  7 percent  $ 3,580
1.214,140 to 6,269  12  3,310
1.224,470 to 6,779  1.2 percent  7 percent  $ 3,580
1.236,270 to 8,369  17  3,310
1.246,780 to 9,049  1.3 percent  12 percent  $ 3,580
1.258,370 to 10,439  17  3,310
1.269,050 to 11,279  1.4 percent  12 percent  $ 3,580
Section 1.  1
03/25/26   REVISOR  EAP/BH  26-08248
2.110,440 to 14,619  17  3,310
2.211,280 to 15,799      1.5 percent  12 percent  $ 3,580
2.314,620 to 16,689  17  3,310
2.415,800 to 18,039      1.6 percent  12 percent  $ 3,580
2.516,690 to 18,799  17  3,310
2.618,040 to 20,319      1.7 percent  12 percent  $ 3,580
2.718,800 to 20,879  17  3,310
2.820,320 to 22,559      1.8 percent  12 percent  $ 3,580
2.920,880 to 22,949  22  3,310
2.1022,560 to 24,799      1.9 percent  17 percent  $ 3,580
2.1122,950 to 29,239  22  3,310
2.1224,800 to 31,599      2.0 percent  17 percent  $ 3,580
2.1329,240 to 31,319  27  3,310
2.1431,600 to 33,849      2.0 percent  22 percent  $ 3,580
2.1531,320 to 35,509  27  3,310
2.1633,850 to 38,379      2.0 percent  22 percent  $ 3,580
2.1735,510 to 50,099  32  3,310
2.1838,380 to 54,139      2.0 percent  27 percent  $ 3,580
2.1950,100 to 73,059  32  2,680
2.2054,140 to 78,959      2.0 percent  27 percent  $ 2,900
2.2173,060 to 83,499  37  2,350
2.2278,960 to 90,239      2.0 percent  32 percent  $ 2,540
2.2383,500 to 93,939  37  1,940
2.2490,240 to 101,519      2.1 percent  32 percent  $ 2,100
2.2593,940 to 104,379  37  1,740
2.26      101,520 to 112,799       2.2 percent  32 percent  $ 1,880
2.27      104,380 to 114,819  37  1,520
2.28      112,800 to 124,089       2.3 percent  32 percent  $ 1,640
2.29      114,820 to 121,089  42  1,280
2.30      124,090 to 130,859       2.4 percent  37 percent  $ 1,380
2.31      121,090 to 125,289  42  1,070
2.32      130,860 to 135,399       2.5 percent  37 percent  $ 1,160
2.33      125,290 to 130,349  47  870
2.34      135,400 to 140,869       2.5 percent  42 percent  $   940
2.35      130,350 to 135,409  47  650
2.36      140,870 to 146,339       2.5 percent  42 percent  $   700
2.37     The payment made to a claimant shall be the amount of the state refund calculated under
2.38 this subdivision. No payment is allowed if the claimant's household income is $135,410
2.39 $146,340 or more.
2.40     EFFECTIVE DATE. This section is effective beginning with refunds based on property
2.41 taxes payable in 2027.
Section 1.  2
03/25/26   REVISOR  EAP/BH  26-08248
3.1    Sec. 2. Minnesota Statutes 2024, section 290A.04, subdivision 4, is amended to read:
3.2      Subd. 4. Inflation adjustment. The commissioner shall annually adjust the dollar
3.3  amounts of the income thresholds and the maximum refunds under subdivision 2 as provided
3.4  in section 270C.22. The statutory year is 2023 2026.
3.5      EFFECTIVE DATE. This section is effective beginning with refunds based on property
3.6  taxes payable in 2027.
3.7    Sec. 3. TAX COMPLIANCE; TAX ANALYTICS AND BUSINESS INTELLIGENCE
3.8  TOOLS.
3.9      Subdivision 1. Program activities. The commissioner of revenue may implement a
3.10 program of tax compliance, including the use of advanced tax analytics and business
3.11 intelligence tools to enhance tax assessment and collection by improving the means to
3.12 identify taxpayers that should be subject to audit and collection activities and by prioritizing
3.13 those activities to provide a higher rate of return on the activities of Department of Revenue
3.14 employees.
3.15     Subd. 2. Priority. The tax compliance program under this section must prioritize
3.16 compliance and enforcement activities for corporations and complex pass-through entities
3.17 under the corporate franchise and individual income taxes, individual income taxpayers
3.18 reporting over $500,000 in taxable income, and businesses subject to the state's sales and
3.19 use tax laws.
3.20     EFFECTIVE DATE. This section is effective the day following final enactment.
3.21   Sec. 4. APPROPRIATION; TAX COMPLIANCE; TAX ANALYTICS AND
3.22 BUSINESS INTELLIGENCE TOOLS; RETURN ON INVESTMENT.
3.23     (a) $5,000,000 in fiscal year 2026 and $15,000,000 in fiscal year 2027 are appropriated
3.24 from the general fund to the commissioner of revenue for purposes of the tax compliance,
3.25 tax analytics, and business intelligence tools program authorized under section 3. The amount
3.26 appropriated under this section must supplement and not supplant other amounts available
3.27 for the purposes described in this section.
3.28     (b) The appropriation in paragraph (a) is for additional activities to identify and collect
3.29 tax liabilities from individuals and businesses that currently do not pay all taxes owed. This
3.30 initiative is expected to result in new general fund revenues of $20,000,000 for the biennium
3.31 ending June 30, 2027, and $120,000,000 for the biennium ending June 30, 2029.
3.32     EFFECTIVE DATE. This section is effective the day following final enactment.
Sec. 4.  3