By Peter G. Pupke, Esq., Checkpoint News
The Minnesota Department of Revenue has issued a detailed chart summarizing the Minnesota state tax impacts resulting from the 2025 Federal Tax Budget and Reconciliation Bill (H.R. 1, the One Big Beautiful Bill Act). (Minnesota Tax Impacts Resulting from the 2025 Federal Tax Budget and Reconciliation Bill (H.R. 1), Minn. Dept. Rev., 02/01/2026.)
Minnesota Nonconformity with Federal Law Changes
Under current law, definitions used in determining Minnesota taxable income are based on the IRC, as amended through May 1, 2023. Since that date, Congress enacted the 2025 Federal Tax Budget and Reconciliation Bill (H.R. 1). Taxpayers may need to make an adjustment to income on their Minnesota return because Minnesota has not adopted the federal changes relating to H.R. 1. Taxpayers can use the Department’s Nonconformity Chart to help determine if adjustments are needed.
The chart lists each federal tax provision, the affected IRC sections, whether Minnesota tax law will be impacted, the tax years affected, and the relevant Minnesota income tax forms. Many provisions will not impact Minnesota, but several will, affecting individuals, estates/trusts, partnerships, corporations, and S corporations for tax years 2022–2027. The chart highlights changes related to deductions, credits, business expensing, charitable contributions, education, energy, and other areas, specifying which Minnesota tax form series (M1, M2, M3, M4, M8) are impacted.
If any of the federal provisions in H.R. 1 affect the amount of taxable income reported on the taxpayer’s federal form, the taxpayer must make an adjustment to income on their Minnesota return.
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