WSJ: Minnesota’s Snowbird Tax — Coming to California?

Richard Rider, Chairman, San Diego Tax FightersUndesignated Leave a Comment


Here’s a recent disturbing WALL ST JOURNAL editorial on a new tax grab out of Minnesota.  It’s disturbing because — given the similar state ideology and political climate — I would expect that, if it’s found to be legal, then California, New York, Illinois and perhaps some other desperate high tax, union-controlled states might very well adopt similar strategies.

The idea is to gouge those evil retired snowbirds who reside outside the state for over 6 months a year, and hence are exempt from Minnesota’s high state income tax.  The governor wants to levy the state income tax on anyone who is physically present in Minnesota over 60 days a year.  Hoh boy!

To start with, guess who is responsible for proving that they DIDN’T live in Minnesota more than 60 days?  Probably anyone who has any connection at all with the state.  Heck, maybe everybody, PERIOD.

As the article below suggests only half in jest — perhaps one will need to put a GPS tracker in Grandma’s phone — or on her ankle!  Regardless, the compliance required would be costly, time-consuming — and potentially dangerous.

And then, as a WSJ letter to the editor pointed out, why limit such taxes to people in the state longer than 60 days?  Why not 30 days?  Or one week?  Or just changing planes in a Minnesota airport?

The tax is largely a “payback” tax driven by the liberals’ favorite motive — “fairness.”  It’s optimistically expected to collect $15 million annually, which is not so much as a burp in Minnesota’s $19 billion state budget.  No matter.  It’s the “principle” that counts.

Part-time geezers cost the state little in the way of services, pay some taxes (sales and often property taxes), and certainly are welcome in the state’s economy.  This punitive tax makes no sense.

The GOP got clobbering in Minnesota in this last election, so it’s pretty much up to the Democrats and their sympathetic courts to decide if this nasty tax will be imposed — virtually assuring that these part-time Minnesota visitors will visit even less often to the Land of 10,000 Lakes.

Fortunately no sane person would seriously consider imposing such vindictive madness.

Uh oh.

January 31, 2013

Minnesota’s Snowbird Tax

Spend most of the year in St. Pete, pay the government in St. Paul.

You may have heard it can get cold in Minnesota in January, or for that matter in April. Last week the temperature dropped to seven below zero in the Twin Cities, which is one reason many Midwesterners head to Florida or Arizona for the winter. But now Governor Mark Dayton wants to tax the snowbirds even if they are no longer legally state residents.

“There is a snowbird tax—absolutely,” the Democratic Governor told reporters the other day. “It’s one of the unfairnesses that somebody can spend six months and one day out of the state and pay no state personal income taxes and come back here and take advantage of all the state has to offer for five months and 29 days. So, yes, there’s a snowbird tax.”

Details are sketchy, but the idea is to tax these nonresidents on their income from stocks, bonds, capital gains and dividends if they spend at least 60 days in Minnesota a year. Income earned in the state is already taxed regardless of residence status, but many retirees or vacationers own a home in the state and live there only for the summer.

The new tax would hit income not earned in Minnesota by those who don’t currently spend the requisite six months and a day in the state to qualify as a taxable resident. So, for example, if you returned to the land of 10,000 taxes only for July and August, you’d suddenly have to pay the taxman in St. Paul on dividend checks sent to your main residence in St. Pete.

The state Revenue Department won’t say how many snowbirders the new tax would hit, but it predicts the tax would raise $30 million over two years. That’s barely an asterisk in Mr. Dayton’s new two-year budget of $37.9 billion, especially since it may drive more residents to leave the state permanently.

The hassle factor will be enormous, with the taxmen presumably demanding proof of location during the year via the likes of airline tickets and golf or restaurant receipts. When revenue invariably doesn’t meet expectations, maybe Mr. Dayton can require a GPS locator for grandma’s cellphone.

But then as the Governor’s line about “unfairnesses” attests, raising revenue isn’t the point of this exercise. The goal is to punish people for the sin of being able to afford to travel south for the winter.

. . .

To read the full article, go to this WSJ link (which I think anyone can access):


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