Subd. 7.

Composite income tax returns for nonresident partners, shareholders, and
beneficiaries.

(a) The commissioner may allow a partnership with nonresident partners to
file a composite return and to pay the tax on behalf of nonresident partners who have no
other Minnesota source income. This composite return must include the names, addresses,
Social Security numbers, income allocation, and tax liability for the nonresident partners
electing to be covered by the composite return.

(b) The computation of a partner's tax liability must be determined by multiplying the
income allocated to that partner by the highest rate used to determine the tax liability for
individuals under section 290.06, subdivision 2c. Nonbusiness deductions, standard
deductions, or personal exemptions are not allowed.

(c) The partnership must submit a request to use this composite return filing method for
nonresident partners. The requesting partnership must file a composite return in the form
prescribed by the commissioner of revenue. The filing of a composite return is considered
a request to use the composite return filing method.

(d) The electing partner must not have any Minnesota source income other than the
income from the partnership and other electing partnerships. If it is determined that the
electing partner has other Minnesota source income, the inclusion of the income and tax
liability for that partner under this provision will not constitute a return to satisfy the
requirements of subdivision 1. The tax paid for the individual as part of the composite return
is allowed as a payment of the tax by the individual on the date on which the composite
return payment was made. If the electing nonresident partner has no other Minnesota source
income, filing of the composite return is a return for purposes of subdivision 1.

(e) This subdivision does not negate the requirement that an individual pay estimated
tax if the individual's liability would exceed the requirements set forth in section 289A.25.
The individual's liability to pay estimated tax is, however, satisfied when the partnership
pays composite estimated tax in the manner prescribed in section 289A.25.

(f) If an electing partner's share of the partnership's gross income from Minnesota sources
is less than the filing requirements for a nonresident under this subdivision, the tax liability
is zero. However, a statement showing the partner's share of gross income must be included
as part of the composite return.

(g) The election provided in this subdivision is only available to a partner who has no
other Minnesota source income and who is either (1) a full-year nonresident individual or
(2) a trust or estate that does not claim a deduction under either section 651 or 661 of the
Internal Revenue Code.

(h) A corporation defined in section 290.9725 and its nonresident shareholders may
make an election under this paragraph. The provisions covering the partnership apply to
the corporation and the provisions applying to the partner apply to the shareholder.

(i) Estates and trusts distributing current income only and the nonresident individual
beneficiaries of the estates or trusts may make an election under this paragraph. The
provisions covering the partnership apply to the estate or trust. The provisions applying to
the partner apply to the beneficiary.

(j) For the purposes of this subdivision, "income" means the partner's share of federal
adjusted gross income from the partnership modified by the additions provided in section
290.0131, subdivisions 8 to 10 deleted text beginanddeleted text endnew text begin,new text end 16new text begin, and 17new text end, and the subtractions provided in: (1) section
290.0132, deleted text beginsubdivisiondeleted text endnew text begin subdivisionsnew text end 9, new text begin27, and 28, new text endto the extent the amount is assignable or
allocable to Minnesota under section 290.17; and (2) section 290.0132, subdivision 14. The
subtraction allowed under section 290.0132, subdivision 9, is only allowed on the composite
tax computation to the extent the electing partner would have been allowed the subtraction.

Subd. 2.

Withholding statement.

(a) A person required to deduct and withhold from
an employee a tax under section 290.92, subdivision 2a or 3, or 290.923, subdivision 2, or
who would have been required to deduct and withhold a tax under section 290.92, subdivision
2a or 3, or persons required to withhold tax under section 290.923, subdivision 2, determined
without regard to section 290.92, subdivision 19, if the employee or payee had claimed no
more than one withholding deleted text beginexemptiondeleted text endnew text begin allowancenew text end, or who paid wages or made payments
not subject to withholding under section 290.92, subdivision 2a or 3, or 290.923, subdivision
2, to an employee or person receiving royalty payments in excess of $600, or who has
entered into a voluntary withholding agreement with a payee under section 290.92,
subdivision 20, must give every employee or person receiving royalty payments in respect
to the remuneration paid by the person to the employee or person receiving royalty payments
during the calendar year, on or before January 31 of the succeeding year, or, if employment
is terminated before the close of the calendar year, within 30 days after the date of receipt
of a written request from the employee if the 30-day period ends before January 31, a written
statement showing the following:

(1) name of the person;

(2) the name of the employee or payee and the employee's or payee's Social Security
account number;

(3) the total amount of wages as that term is defined in section 290.92, subdivision 1,
paragraph (1); the total amount of remuneration subject to withholding under section 290.92,
subdivision 20; the amount of sick pay as required under section 6051(f) of the Internal
Revenue Code; and the amount of royalties subject to withholding under section 290.923,
subdivision 2; and

(4) the total amount deducted and withheld as tax under section 290.92, subdivision 2a
or 3, or 290.923, subdivision 2.

(b) The statement required to be furnished by paragraph (a) with respect to any
remuneration must be furnished at those times, must contain the information required, and
must be in the form the commissioner prescribes.

(c) The commissioner may prescribe rules providing for reasonable extensions of time,
not in excess of 30 days, to employers or payers required to give the statements to their
employees or payees under this subdivision.

(d) A duplicate of any statement made under this subdivision and in accordance with
rules prescribed by the commissioner must be filed with the commissioner on or before
January 31 of the year after the payments were made.

(e) If an employer cancels the employer's Minnesota withholding account number required
by section 290.92, subdivision 24, the information required by paragraph (d), must be filed
with the commissioner within 30 days of the end of the quarter in which the employer
cancels its account number.

(f) The employer must submit the statements required to be sent to the commissioner.
The commissioner shall prescribe the content, format, and manner of the statement pursuant
to section 270C.30.

(g) A "third-party bulk filer" as defined in section 290.92, subdivision 30, paragraph
(a), clause (2), must submit the returns required by this subdivision and subdivision 1,
paragraph (a), with the commissioner by electronic means.

Subd. 3.

Inflation adjustment.

For taxable years beginning after December 31, 2019,
the commissioner must adjust for inflation the exemption amount in subdivision 1, paragraph
(b), and the threshold amounts in subdivision 2, as provided in section 270C.22. The statutory
year is taxable year 2019. The amounts as adjusted must be rounded down to the nearest
$50 amount. deleted text beginIf the amount ends in $25, the amount is rounded down to the nearest $50
amount.deleted text end The threshold amount for married individuals filing separate returns must be one-half
of the adjusted amount for married individuals filing joint returns.