MPR: The Sales Tax Rebate Explained

Where's My Money?
How the Sales-Tax Rebate Works
Source: Minnesota Department of Revenue
May 19, 1999

More Information

Listen to an interview with Morning Edition's Bob Potter and Joe Lefto, Project Manager for the Sales Tax Rebate at the Minnesota Department of Revenue

Who Qualifies?

Minnesota residents who lived here at least part of the year during 1997, and nonresidents who made purchases and paid consumer sales tax here, qualify for the rebate. Most Minnesota residents will automatically receive their rebate based on their 1997 Form M-1 Return.

Minnesota residents who were not claimed as a dependent on a 1997 federal income-tax return and, before June 15, 1999, either file for the 1997 Property Tax Rebate, or filed a 1997 Minnesota Income Tax Return with tax liability before refundable credits of at least $1 (line 7 of Form M-1), are eligible for the rebate. Amendments or adjustments to 1997 Form M-1 returns made after June 15, 1999 will not affect rebate amounts.

Joint and Head of Household
1997 Taxable Income	Sales-Tax Rebate
Less than $2500	$358
2,500-4,999	$469
5,000-9,999	$502
10,000-14,999	$549
15,000-19,999	$604
20,000-24,999	$641
25,000=29,999	$690
30,000-34,999	$762
35,000-39,999	$820
40,000-44,999	$874
45,000-49,999	$921
50,000-59,999	$969
60,000-69,999	$1,071
70,000-79,999	$1,162
80,000-89,999	$1,276
90,000-99,999	$1,417
100,000-119,999	$1,535
120,000-139,999	$1,682
140,000-159,999	$1,818
160,000-179,999	$1,946
180,000-199,999	$2,067
200,000-399,999	$2,644
400,000-599,999	$3,479
600,000-799,999	$4,175
800,000-999,999	$4,785
1,000,000 +	$5,000
Source: Minnesota Department of Revenue

Taxpayers who had their 1997 homestead taxes abated to zero because of flood damage and were, therefore, not eligible for the Property Tax Rebate in that year, are also eligible for the rebate.

Nonresidents who can document taxable purchases during 1997 will have to June 20,1999 to claim rebates equal to 69 percent of their state sales tax paid, up to the maximum amounts that a similarly situated resident could claim.

How is the rebate calculated?

Minnesota residents - There are two tables used to determine the Sales Tax Rebate, one for joint and head of household filers, the other for single and married filing separate filers. Use the taxable income amount on line 4 of the taxpayer's 1997 Form M-1 to determine the appropriate rebate amount. Based on adjustments to the 1997 Income Tax return filed on or before April 15, 1999 part-year residents will have their rebate calculated the same way and then apportioned by the percent their Minnesota income is to total income.

Nonresidents - must show receipts documenting purchases and can claim rebates up to 69 percent of their sales tax paid, up to the maximum amounts that a similarly situated resident could claim.

Will the rebate amounts be adjusted for family size?

No. We do not retain family size information.

What about dependents?

People who were claimed as dependents on someone else's \federal income tax return for 1997 are not eligible for the Sales Tax Rebate.

Single and Married Filing Separately
1997 Taxable Income	Sales-Tax Rebate
Less than $2500	$204
2,500-4,999	$249
5,000-9,999	$299
10,000-14,999	$408
15,000-19,999	$464
20,000-24,999	$496
25,000=29,999	$515
30,000-39,999	$570
40,000-49,999	$649
50,000-69,999	$776
70,000-99,999	$958
100,000-139,999	$1,154
140,000-199,999	$1,394
200,000-399,999	$1,889
400,000-599,999	$2,486
600,000+	$2,500
Source: Minnesota Department of Revenue

What if a couple filed a joint return but have since divorced?

The current plan is to split rebates whenever we have enough information to send the split rebates to both spouses. If two people who filed a joint return for 1997 are now separated, and we have separate addresses, we will split the check. If we do not split the check, the parties can ask the Department of Revenue to split the check 50/50 as long as they have not cashed it. For joint filers, the check will go to the most recent address of the primary taxpayer. This is usually the one with the lower Social Security number.

When will the checks be mailed?

Checks are scheduled to be mailed in August. If the checks are delayed past Oct. 1, 1999 interest will be paid on the rebate due.

What about direct deposit?

If you elected to receive your 1998 Income Tax Refund by direct deposit, you will receive your Sales Tax Rebate the same way - a notification of deposit will also be sent to you. Otherwise, a check will be mailed to the most current address the department has on file for you.

How do I get a copy of my 1997 Form M-1?

To request a copy of your 1997 Form M-1, send a signed written request to Minnesota Department of Revenue; Mail Station 4400; St. Paul, MN 55146-4400.

What if I owe taxes?

The Sales Tax Rebate is subject to revenue recapture. (It will be applied toward the balance due.)

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