AB 375

This bill requires the Department of Revenue, in conjunction with the

Minnesota Department of Revenue, to conduct a study on the effects of instituting

income tax reciprocity between Wisconsin and Minnesota. The study must

determine the number of residents of each state who earn income in the other state,

the total amount of income earned in each state by such taxpayers, and the amount

of tax revenue that would be forgone by each state if reciprocity were instituted.

Under reciprocity, taxpayers must pay taxes only in their state of residence on

income earned in the other state. The study is to be based on income tax data for

taxable years 2020 and 2021 and any other information each DOR determines is

necessary to complete the study. The results of the study must be submitted to the

legislature and governor of each state no later than December 31, 2024.

The bill also requires that any income tax reciprocity agreement between

Wisconsin and Minnesota applies to wages, salaries, tips, and commissions received

by persons who reside in this state or Minnesota for at least 183 days during their

taxable years and return to their state of residence at least once per month; does not

have an expiration or termination date; and is approved by both the governor and the

Joint Committee on Finance. Under the bill, Wisconsin may not make a payment to

Minnesota for any prior taxable years before the reciprocity agreement takes effect,

and a reciprocity agreement may not be revised unless approved by JCF.