This bill proposes a new exemption for certain nonresident employees regarding individual income taxation in Minnesota. Specifically, it allows qualifying nonresident individuals to exclude compensation received for employment duties performed in Minnesota from their gross income, provided they meet specific criteria, such as working in Minnesota for 30 days or fewer during the taxable year and performing employment duties in multiple states. The bill defines key terms, including "qualifying nonresident individual" and "employment duties," and outlines the conditions under which this exemption applies.

Additionally, the bill establishes that wages paid to qualifying nonresident individuals are exempt from withholding and filing requirements, with a stipulation that if the employee exceeds the 30-day threshold, withholding will apply for all days worked in Minnesota. It also provides protections for employers against penalties for failing to withhold taxes if they relied on a time and attendance system or reasonable determinations made by employees regarding their work locations. The provisions of this bill will take effect for taxable years beginning after December 31, 2025.