Farmers and other Minnesota business owners are being slapped with unexpected tax bills this year, a problem District 16A State Rep. Chris Swedzinski of Ghent said needs to be fixed during the 2020 legislative session.
Swedzinski said the state’s failure to fully comply with federal Section 179 tax code has left like-kind exchanges to be treated by the state as income.
In other words, anyone who uses a trade-in as part of a capital purchase could be subject to this new Minnesota tax, often in the thousands of dollars.
“One of the big things I keep hearing from businesses and farmers trying to expand their business or update their equipment, is that we need to fix the Section 179 issue, because folks are really getting dinged if they’re trying to improve or update their equipment,” Swedzinski said. “That’s going to be a big part of what we work on this coming session. We made a big stride when it comes to property taxes, so the amount your land is potentially being taxed for the building of a project. Across the state for school construction, the state is essentially pitching in and helping cover the cost rather than it falling all on a farm economy in our local areas.”
The Minnesota legislature is scheduled to reconvene for the start of the 2020 session in St. Paul Feb. 11.