Non-Resident Aliens

1
Non-Resident Aliens

• Filing Your 2011 Minnesota Income and Property
  Tax Return

2
Minnesota Residency for Tax Purposes

• 183 Day Rule Days in Minnesota
• Must establish a tax home
• Visas are a temporary status.
• Any portion of a day is counted as a full day in
  Minnesota.
• Rent, own or occupy an abode a self contained
  living unit, suitable for year-round use,
  equipped with its own cooking and bathing
  facilities.

3
Filing a Minnesota Income Tax Return

• Filing federal Form 8843
• No equivalent form for Minnesota
• If required to file a federal return, then
  required to file a MN return.
• Minnesota return starts with federal taxable
  income
• Form 1040NR - Line 41
• Form 1040NR-EZ - Line 14
• If itemizing deductions on federal-
• Must add back ALL state income tax on Line 2 of
  Form M-1.
• Do not use worksheet in M-1 booklet.
• Minnesota requires a copy of the federal return
  to be enclosed when filing the Minnesota return.

4
Filing status same as federal (MFS for state)
A Wages from Line 8 or Line 3 (EZ) B C
Usually blank D FAGI from Line 36 or Line 10 (EZ)
Line 1 Federal Taxable Income from Line 41 or
Line 14 (EZ)
Line 2 State Tax from Line 3 of Schedule A or
Line 11 (1040-NR)
Line 5 State Tax Refund from Line 11 or Line 4
(EZ)
5
Minnesota Additions/Subtractions

• Form M1, Line 3
• Schedule M1M (Additions)
• Complete list of other items on page 11 of
  Minnesota Income Tax Instruction booklet.
• Form M1, Line 6
• Schedule M1M (Subtractions)
• Complete list of other items on page 11 of
  Minnesota Income Tax Instruction booklet.

6
Line 23 Schedule M1W- Show Minnesota
withholding only
Line 25 Schedule M1CD, Child and Dependent Care
Expenses Credit
Line 27 Schedule M1ED, K-12 Education Expenses
Credit
Refund or Payment Due
7
Completing Schedule M1W

• 1042S
• Box 24
• Box 2- Gross Income
• Box 23
• Box 25 State Name

• W-2
• Box 15 - MN ID
• Box 16 - State Wages....
• Box 17 - MN W/H...
• Only need to fill in this form if there are state
  taxes withheld..usually no state tax on 1042S.
  Report Minnesota tax withheld on Line 2 of
  Schedule M1W, as you would for Form 1099.

8
Enter state tax withheld from Form W-2.
Enter state tax withheld from Form 1042-S.
9
Minnesota Credits

• Do not qualify for federal EIC, so do not qualify
  for Minnesota Working Family Credit.
• MFS cannot claim credits
• No Marriage Credit, No Refundable Credits (Child
  and Dependent Care Credit Education Credit)
• Minnesota Child and Dependent Care Credit
• Schedule M1CD
• Single with qualifying child (See Pub. 17)
• Must qualify for the federal credit
• Must have Minnesota assignable income

10
Minnesota Credits

• Minnesota K-12 Education Credit
• Schedule M1ED
• Paid qualifying educational expenses for 2011
• Household income limit and maximum credit based
  on number of qualifying children in K-12 for 2011
• See pages 11, 13, and 16 of Minnesota Income Tax
  instruction booklet for more information.

11
Minnesota Residency for Tax Purposes

• Full-year residents
• Form M-1
• Must file regardless of Minnesota income.
• Part-year Non-residents
• Schedule M1NR
• Must file if over 9,500 of gross income from
  Minnesota sources.
• Do not use if only Minnesota source income, then
  just file Form M-1.
• Must have received income while residing in
  another state in order to file Schedule M1NR.

12
Property Tax Return

• Must be a full-year or part-year Minnesota
  resident (183 day rule).
• Dependents are not eligible (50 Support Rule) -
  must be self supporting.
• Must live in a unit which is considered an
  abode - cooking and bathing facilities.
• Unit must have been subject to property taxes.
• Filing status is not an issue depends on living
  situation.
• Homeowners only- must have valid SSN.

13
Student Living Situations

• For the property tax refund- must pay property
  taxes on unit - may not receive a CRP if
  non-profit organization.
• Dormitory
• Separate cooking facility
• Bathing facility per unit
• Student Housing
• Living Off Campus

14
Household Income

• Line 1 - Federal Adjusted Gross Income
• From 1040NR-EZ Line 10
• From 1040NR Line 36
• Line 5 Additional Nontaxable Income
• Must include income from all sources, taxable and
  non-taxable income included.
• Write non-resident alien and income type in box.
• Scholarships and fellowships
• Income excluded by a tax treaty
• Tuition paid by the University for the PhD
  student in exchange for TA duty
• Interest
• See page 8 of Property Tax Instruction booklet.

15
Property Tax Return

• Line 7 - Subtraction for Dependents
• See federal definition for qualifying child.
• To determine amount, see worksheet on page 9 of
  Property Tax Instruction booklet.
• Only Mexico and Canada can claim dependents for
  property tax refund purposes if able to claim
  dependents on the 1040 NR.

16
Property Tax Return

• Renter Situations
• If two unmarried adults live in a rental unit,
  the Certificate of Rent Paid is split equally by
  the landlord. Each apply for refund separately.
• If income is less than the rent paid, enclose a
  separate sheet of paper when filing the return to
  explain the source of funds used to pay the rent.

17
SSN or ITIN
Capital letters- Name/address
Living Status
x
Line 1 Federal Adjusted Gross Income (X, if
negative)
Line 5 Additional Non-Taxable Income (Page 8 -
PR Booklet)
18
Dont forget! Signature on bottom of return.
19
For Additional Information Fact Sheet 16
Aliens Department of Revenue
Websitewww.revenue.state.mn.usIncome Tax
Questions 651-296-3781 or 1-800-652-9094
20
Questions?