Senate File 46 would create a 30‑day safe harbor for nonresident workers' Minnesota tax liability

Senator Rest introduced Senate File 46, which would create a 30‑day safe harbor for qualifying nonresident employees who perform employment duties in Minnesota for short periods during the taxable year.

The sponsor described the bill as a compliance‑and‑administration fix that counts days worked in Minnesota (using a time‑and‑attendance system or employee records) rather than attempting to apportion income based on estimated earnings in the state. "The 30 day threshold applies to both personal income tax liability of the employee and the withholding requirement for employers," a witness explained, and supporters said days are easier to count than dollars.

Supporters included the Minnesota Business Partnership and the Minnesota CPA Society. Gavin Hanson of the Minnesota Business Partnership said the bill "provides clarity and simplicity" for employees and employers who travel for brief work assignments. Gino Fragnito of the Minnesota CPA Society said the measure would reduce compliance burdens and administrative costs for the Department of Revenue. Douglas Lindholm, a national tax practitioner who testified remotely, described long‑running efforts to secure a uniform federal solution and urged states to adopt a 30‑day standard to reduce widespread noncompliance and avoid tens of thousands of small, low‑dollar returns.

The bill includes a reciprocity provision: Minnesota would apply the safe harbor only to workers who reside in states that provide a substantially similar exclusion or that do not impose an individual income tax. The sponsor offered an authors' oral amendment to tighten timing language, which was introduced and accepted by the committee during the hearing.

Action: The committee adopted the sponsor's author's amendment (oral amendment changing wording on two lines) and laid SF 46 over for possible inclusion in the omnibus tax bill. The transcript recorded no roll‑call vote on final passage; the committee directed staff to review fiscal estimates and the Department of Revenue noted the fiscal note is sensitive to filing patterns and remote‑work trends.

Ending: Sponsors said the bill would modernize Minnesota's withholding and filing obligations to match contemporary workforce mobility and reduce administrative burdens on employers and the Department of Revenue; staff will return with updated revenue estimates.