Direct Tax Rebate Payments: A Guide to Understanding and Claiming Your Rebate

The legislation, which was signed on May 24, 2023

Direct Tax Rebate Payments

Direct Tax Rebate Payments: After a recent tax law update, the Minnesota Department of Revenue will transmit direct tax rebate payments for the tax year 2021 to eligible Minnesotans. The legislation, which was signed on May 24, 2023, provides funding for:

$520 for married couples filing jointly with less than $150,000 in adjusted gross income
$260 for all other taxpayers with a gross adjusted income of $75,000 or less

Additional $260 per dependent is claimed on your tax return, up to a maximum of three dependents ($780).

You need not register to receive this payment. We will ascertain eligibility based on previously filed 2021 income tax or property tax refund returns and issue payments in early autumn. There is no appeals process, and our Where’s My Refund? the system cannot trace the payment.

This payment is not taxable on your Minnesota income tax return and will not be applied to any delinquent taxes or obligations we collect on behalf of other agencies. We have requested guidance from the IRS to determine if the rebate is taxable on your federal return and will relay their decision once we have received it.

Who qualifies

You qualify if you meet all of the following criteria:

You lived in Minnesota for part or all of 2021.
You submitted one of the returns listed below by December 31, 2022:
2021 Minnesota Form M1, Individual Income Tax 2021 Minnesota Form M1PR, Homestead Credit Refund (for Homeowners) and Renter’s Property Tax Refund
The following was your 2021 adjusted total income (line 1 of Form M1 or Form M1PR):
$150,000 or less for joint filing married couples
$75,000 or less for everyone else

No one claimed you as a dependent on their 2021 Minnesota income tax return.

Taxpayers who passed away prior to January 1, 2023, are ineligible.

Part-year Minnesota residents receive a refund proportional to their time spent in the state.

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What Occurs Next?

We will determine eligibility and payment amounts based on your Minnesota returns for the year 2021. There is nothing you must do at this time.

IF YOU…	THEN…
You have met the income limits and neither your bank information nor your address has changed since you filed your 2021 tax return.	You are exempt from taking any action. The refund will be deposited into your bank account or mailed to the address on your 2021 tax return.
If you have met the income limits and your bank information or address has changed since filing your 2021 tax return, you must file an amended return.	This summer, you will need to update your information with us. We will shortly provide a secure method for you to update your information online.
Exceeded the income limits, did not file, or was claimed as a dependent on another person’s 2021 tax return.	You do not qualify for this tax rebate payment.