Not shockingly, many older Minnesotans leave our state once they retire. Yes, some of it may be to escape our harsh winters. Yet, assuredly a lot of the people move to avoid paying high tax rates that we levy upon all residents. Still, some of those who have flown the coop return for some of our nicer summer weather and to visit with relatives.
Governor Dayton is proposing that certain Snowbirds become “part-year residents” subjecting them to new taxes estimated to raise about $30 million over the biennium ($15 million a year). That is real money but in the great scheme of things, I have to wonder why the governor would want to get in grandma’s and grandpa’s grill for $15 million a year.
The MMB website says “Part-year residents will be subject to tax on their Minnesota-sourced income…. and a pro-rata share of all other income based on the number of days they are present in the state. A credit will be granted for income taxes paid on the same income to other states if the other state does not allow a credit for tax paid to Minnesota.” If you are here for medical treatment (Mayo anyone?) the rules do not apply. Gee thanks.
This would capture folks who maintain a home for half the year and actually come to the state for at least 61 days. The reason? “This proposal will make Minnesota’s overall tax system more fair by requiring those who benefit from Minnesota state and local public services for a substantial portion of the year also contribute to the cost of providing those services.”
Why would we make our retired parents keep track of their whereabouts when they are here to visit and enjoy their families during the summer? Why would we burden them with having to prove their whereabouts to the government in their golden years? The MMB website says they will have to keep records including, “planners, calendars, plane tickets, canceled checks, credit card and other receipts.” I know that folks trying to avoid the 183-day rule already do this but this seems very invasive to me—and just stupid for a measly $15 million a year when we are spending about $30 billion in this state every year (state and federal funds).
Do we really want to chase retired people from our shores? Besides the loss to our economy, Governor Dayton’s plan would deprive families of precious time with grandparents. How many retirees would sell or transfer their lake homes and cabins to adult children? Sell or drop the lease on condos and apartments? (I guess we can capture more taxes from the proposed 5.5% sales tax people would pay to consult with accountants, brokers and lawyers until they can get out of the state.)
All those special memories—and the neat things we treasure during our short, cherished summers—will be shortened to 60 days! Nana is no fool. She is mobile and so is her income.