Minnesota weighs tax filing deadline delay, to match May 17 federal deadline

Minnesota revenue officials are likely to delay the state's tax filing deadline to match the new May 17 federal deadline, a key lawmaker said Thursday.

ST. PAUL, Minn. (FOX 9) - Minnesota revenue officials are likely to delay the state's tax filing deadline to match the new May 17 federal deadline, a key lawmaker said Thursday.

State Rep. Paul Marquart, the House Tax committee chairman, said he had a "strong, strong, strong presumption" that the Minnesota Revenue Department would make the change. The announcement could happen as soon as Friday, said Marquart, DFL-Dilworth.

The IRS announced Wednesday that it was pushing back the deadline for individual filers to May 17 as it deals with millions of backlogged 2019 returns and tax changes in this month's COVID relief law.

Minnesota revenue officials are reviewing the IRS's change and a potential state deadline extension, said Don Gore, a spokesman for the agency.

Senate Tax committee chairwoman Carla Nelson said she was preparing to introduce legislation to force revenue officials to conform with the May 17 federal deadline.

"Our tax filers have had enough stress," Nelson, R-Rochester, said in a phone interview. "There's just so many things that are changing, so we have to provide some clarity to our taxpayers."

Minnesota followed suit last year after the IRS delayed the 2020 deadline as the country plunged into the coronavirus pandemic.

Baker Tilly tax partner Jacque Lee said she expected most states would conform with the new federal deadline.

"We'll have to wait and see, so it's a little hard to speculate (on what Minnesota will do)," Lee said in an interview. "I would still highly encourage people, especially if they’re getting a refund, to get filed early or on time."

One of the changes in this month's COVID relief law was a subtraction making the first $10,200 of 2020 unemployment benefits free from federal taxes. The tax break applies to people who made less than $150,000 in income.

An estimated 553,000 Minnesotans will benefit from the break, Gov. Tim Walz's administration estimated Thursday.

IRS Commissioner Charles Rettig, appearing before a U.S. House Ways and Means subcommittee, said he expected his agency would be able to automatically issue refunds to people who filed their taxes before the tax break became law.

"The people who filed absolutely should not file an amended return," Rettig said. "We’re sensitive to the situation people are in. We believe we’ll be able to handle this on our own."

Rettig said his agency had a backlog of 7.3 million 2019 tax returns that he expected to clear by summer. The backlog has prevented some people from receiving two direct payments approved by lawmakers as part of 2020 stimulus laws.

Walz has proposed conforming to federal law and making the first $10,200 of 2020 benefits free from state taxes. The GOP-controlled Senate has approved legislation forgiving 18 percent of 2020 unemployment benefits.