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| Date: | July 25, 2011 | | Contact Name: | Chris Van Guilder | | Contact Phone: | 651-296-1388 | | Contact Email: | christopher.vanguilder@senate.mn | | For Immediate Release | |
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| SENATOR MILLER: INCOME TAX RECIPROCITY TO RESUME WITH WISCONSIN |
St. Paul – Income tax reciprocity with the State of Wisconsin is likely to resume for tax year 2012 because of legislation authored by Senator Jeremy Miller (R-Winona) and included in the Omnibus Tax bill that passed in the special session of the legislature. The new law directs the Commissioner of Revenue to initiate negotiations with the Secretary of Revenue of Wisconsin for purposes of entering into a new reciprocity agreement effective for tax year 2012.
“Thousands of residents in Fillmore, Houston, and Winona counties are directly impacted by the agreement,” Miller said. “Without the reciprocity agreement, these residents had to file income taxes twice and paid increased taxes to Wisconsin. It is an unfortunate arrangement, and I am hopeful we will have a new agreement in place soon.”
A previous reciprocity agreement allowed residents who live in one state and work in another to pay income taxes only in their state of residence, and the state governments would work out the differences at a later date.
Because there are more than twice as many Wisconsin residents who work in Minnesota, Wisconsin reimbursed Minnesota for the income tax it collected from Minnesota workers. However, the payments were made about 17 months after the taxes were collected. Wisconsin recently remitted nearly $60 million it has owed to Minnesota since December 2010. Attempts in 2009 to negotiate a faster payback were unsuccessful and Gov. Pawlenty ended the agreement.
Wisconsin Governor Scott Walker has stated that he is eager to enter into a new agreement.
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