Minnesota Statutes Various State Taxes and Programs (Ch. 289A-295) § 290.0131. Individuals, estates, and trusts; additions to federal taxable income or federal adjusted gross income

Subdivision 1. Definition; scope. (a) For the purposes of this section, “addition” means an amount that must be added to federal taxable income for a trust or an estate or federal adjusted gross income for an individual in computing net income for the taxable year to which the amounts relate.

(b) The additions in this section apply to individuals, estates, and trusts.

(c) Unless specifically indicated or unless the context clearly indicates otherwise, only amounts that were deducted or excluded in computing federal taxable income for a trust or an estate or federal adjusted gross income for individuals are an addition under this section.

Subd. 2.Federally exempt interest income. (a) Interest income on obligations of any state other than Minnesota or a political or governmental subdivision, municipality, or governmental agency or instrumentality of any state other than Minnesota exempt from federal income taxes under the Internal Revenue Code or any other federal statute is an addition.

(b) Exempt-interest dividends as defined insection 852(b)(5) of the Internal Revenue Code 1are an addition, except the portion of the exempt-interest dividends:

(c) For the purposes of paragraphs (a) and (b), interest on obligations of an Indian tribal government described insection 7871(c) of the Internal Revenue Codeis treated as interest income on obligations of the state in which the tribe is located.

Subd. 5.Income taxes deducted in computing federal adjusted gross income. (a) The amount of income taxes paid or accrued within the taxable year under this chapter and taxes based on net income paid to any other state or any province or territory of Canada is an addition to the extent allowed as a deduction in determining federal adjusted gross income.

(b) For the purpose of this subdivision, income taxes do not include the taxes imposed bysections 290.0922, subdivision 1, paragraph (b); 290.9727; 290.9728; and290.9729.

Subd. 9.Bonus depreciation. (a) 80 percent of the depreciation deduction allowed undersection 168(k) of the Internal Revenue Codeis an addition.

(b) For the purposes of this subdivision, if the taxpayer has an activity that in the taxable year generates a deduction for depreciation undersection 168(k) of the Internal Revenue Codeand the activity generates a loss for the taxable year that the taxpayer is not allowed to claim for the taxable year, “the depreciation deduction allowed undersection 168(k)” for the taxable year is limited to excess of the depreciation claimed by the activity undersection 168(k)over the amount of the loss from the activity that is not allowed in the taxable year. In succeeding taxable years when the losses not allowed in the taxable year are allowed, the depreciation undersection 168(k)is allowed.

Subd. 10. Section 179 expensing. (a) For property placed in service in taxable years beginning before January 1, 2020, except for qualifying depreciable property, 80 percent of the amount by which the deduction allowed under the dollar limits ofsection 179 of the Internal Revenue Codeexceeds the deduction allowable bysection 179 of the Internal Revenue Code, as amended through December 31, 2003, is an addition.

(b) For purposes of this subdivision, “qualifying depreciable property” means:

(1) the total distributions for the taxable year from a qualified plan undersection 529 of the Internal Revenue Code, owned by the taxpayer, that are expended for qualified higher education expenses undersection 529(c)(7) of the Internal Revenue Code(expenses for tuition for elementary or secondary public, private, or religious school); or

(2) the total amount required to be reported to the taxpayer by any trustee of a qualified tuition plan undersection 529 of the Internal Revenue Codeas earnings on Internal Revenue Service Form 1099Q for the taxable year.

Subd. 20. Disallowed net operating loss deduction. (a) The amount of a net operating loss arising in any taxable year beginning after December 31, 2017, and before January 1, 2021, and carried back undersection 172(b)(1)(D) of the Internal Revenue Codeis an addition in the taxable year the loss is carried. No addition is required for a net operating loss deduction that is a farming loss undersection 172(b)(1)(B) of the Internal Revenue Codecarried to the two years preceding the year the farming loss arose.

(b) The amount of a net operating loss deduction in any taxable year beginning after December 31, 2017, and before January 1, 2021, that exceeds the deduction allowed undersection 172(a)(2) of the Internal Revenue Codeis an addition. For purposes of this paragraph, the deduction allowed undersection 172(a)(2) of the Internal Revenue Codeis allowed in the case of a taxable year beginning after December 31, 2017.

(c) The amount of a Minnesota disallowed loss carryover is an addition. For purposes of this paragraph, “Minnesota disallowed loss carryover” means, for any taxable year beginning after December 31, 2017, and before January 1, 2021, a disallowed loss carryover as defined insection 461(l)(2) of the Internal Revenue Code, for a loss that is not allowed undersection 461(l)(1)(B) of the Internal Revenue Code. For purposes of this paragraph, the limitation undersection 461(l)(1)(B) of the Internal Revenue Codeapplies for any taxable year beginning after December 31, 2017.

(d) For purposes of this subdivision, “Internal Revenue Code” means the Internal Revenue Code of 1986, as amended through December 15, 2022.