Minnesota officials overshot tax rebate estimate by $144M
State revenue officials overestimated how many Minnesotans would be eligible for tax rebate checks, resulting in $144 million less going out the door.
When lawmakers approved the one-time rebates this spring, they had projections of a giveback that would top $1.1 billion. The final amount was below $1 billion.
The difference was noted in a quarterly economic memo released Wednesday by the Minnesota’s finance agency.
Minnesota Department of Revenue officials said they used 2019 income tax returns to set their estimate for rebate checks. Those were adjusted to account for population growth between 2019 and 2021. But that led to an overcount of how many dependents could be covered.
Create a More Connected Minnesota
MPR News is your trusted resource for the news you need. With your support, MPR News brings accessible, courageous journalism and authentic conversation to everyone - free of paywalls and barriers. Your gift makes a difference.
Lawmakers approved and the governor signed into law a tax bill earlier this year that granted a one-time rebate of $260 to individuals under a certain income cap, or $520 to married couples. And families with dependents could see an extra $260 for up to three dependents.
Single filers had to make less than $75,000 in adjusted gross income in 2021 to qualify. For married filers, the income limit was $150,000. People couldn’t have been claimed as a dependent on another filer’s tax form.
Nearly 2.1 million payments went out between mid-August and the end of September through direct deposit or paper checks.
In its quarterly update, Minnesota Management and Budget said overall tax collections over the last few months blew by projections. The collections exceeded estimates by $400 million or almost 7 percent.