HF 5002 Summary

• Increases tax preparer penalties from $1,000 to up to $5,000 per violation of cease and desist orders and extends related hearing timelines from 10 to 30 days for administrative proceedings.

• Modifies qualified heir return requirements from two returns (at 24-26 months and 36-39 months after death) to a single return attesting no disposition or cessation occurred.

• Extends Internal Revenue Code reference date from December 15, 2022 to May 1, 2023 for Minnesota tax calculations and clarifies net income computations for partnerships and pass-through entities.

• Provides marketplace provider liability relief from sales tax collection failures when errors result from incorrect information by marketplace sellers, with marketplace sellers becoming solely liable for uncollected tax (effective June 30, 2024).

• Establishes reporting and accountability requirements for tier I cities and counties receiving local affordable housing aid, with fund repayment obligations and suspension of distributions for repeated non-compliance.