Does Minnesota and Wisconsin have tax reciprocity?

The reciprocity agreement between Wisconsin and Minnesota expired January 1, 2010. The agreement allowed residents of one state to file a single income tax return with their home state if they worked across the border. The cancellation affects people in Wisconsin and Minnesota.

What states does Minnesota have tax reciprocity with?

Minnesota has income tax reciprocity agreements with Michigan and North Dakota. These agreements may simplify tax filing for people who live or work in Minnesota and one of these states.

Which states does Wisconsin have reciprocity with?

Wisconsin currently has reciprocity agreements with four states: Illinois, Indiana, Kentucky, and Michigan. These agreements provide that residents of these states working in Wisconsin will be taxed on income earned as an employee by their home state and not by Wisconsin.

What determines Wisconsin residency?

Section 29.001(69) of the Wisconsin Statutes defines residency: “Resident” means a person who has maintained his or her place of permanent abode in this state for a period of 30 days immediately preceding his or her application for an approval.

Is there a tax reciprocity agreement between Wisconsin and Minnesota?

Because of this, Minnesota began offering Minnesota residents who work in Wisconsin a special tax credit in August 2017 – a move that essentially nullified talks of reinstating tax reciprocity. However, Wisconsin is still open to restoring its full tax reciprocity agreement with Minnesota as of December 2017.

How to get a Minnesota reciprocity tax refund?

If you are a Michigan or North Dakota resident, you can file a Minnesota income tax return for a refund of the tax withheld. For more information, see Reciprocity Income Subtraction. To avoid having Minnesota tax withheld from your wages, complete Form MWR, Minnesota Reciprocity Exemption Certificate, and provide it to your employer.

Is there a Minnesota Tax Credit in Wisconsin?

Wisconsin will allow a credit for the net income tax paid to Minnesota on income that is taxed by both Wisconsin and Minnesota. Questions? If you have questions about Wisconsin income tax, contact the Wisconsin Department of Revenue:

Why does Minnesota pay more in taxes than Wisconsin?

While under the tax reciprocity plan with Wisconsin, Minnesota residents paid more to the Minnesota treasury because Minnesota limits tax credits to other states while Wisconsin does not. Wisconsin’s state taxes are also higher than Minnesota’s. Without the tax reciprocity, Minnesotans are not paying these higher taxes.