HF2871 Summary

• Modifies homestead property tax classification rates: Class 1a property with market value up to $500,000 taxed at 1% rate, and value exceeding $500,000 taxed at 1.25% rate.

• Establishes annual withholding return option for employers with $500 or less in required withholding, with annual filing due February 1 instead of quarterly payments.

• Updates estate tax provisions including increases in qualified small business and farm property exemptions from $1.2 million to $2 million by 2018, effective retroactively for estates of decedents dying after June 30, 2011.

• Changes income allocation rules for nonresident athletes and entertainers to assign all income from performances in Minnesota to the state, and clarifies covenant-not-to-compete income allocation.

• Repeals Minnesota Rules parts 8092.1400 and 8100.0700 regarding annual withholding returns and public utility property equalization procedures, with new statutory provisions replacing certain regulatory requirements.