Minnesota farmer Todd Schneeberger alerted his state lawmaker this year after he found out that trading in his combine could hit him with a surprise $8,000 to $10,000 bill from the state — the result of recent tax code changes.
The Elbow Lake resident and others exchanging equipment could be caught up in one of the problems associated with conforming the state’s tax code to the federal tax law passed in 2017. House Republicans shared Schneeberger’s story last week, blaming Democrats and calling for the state to shift from partial to full alignment with a section of the federal tax code dealing with businesses’ tax deductions on equipment.
House Tax Committee Chairman Paul Marquart, DFL-Dilworth, called the politicization “disappointing.” Democrats also want to conform with that section of the federal tax code, he said. But conformity is expensive, especially if it’s going to be retroactive, and they couldn’t reach an agreement with Republicans on how to pay for it, he said. Democrats proposed taxes on corporate foreign income to cover the roughly $220 million cost, he said.
Marquart said he also would like to take up the tax law again next session and is open to tackling the troublesome equipment exchange situation.
About 7,250 individuals could potentially receive bills similar to Schneeberger’s, according to the Department of Revenue.
Jessie Van Berkel