Walz signs his first bill of the 2-week-old legislative session, fixes error to save taxpayers $350M

ST. PAUL, Minn. (AP) — Gov. Tim Walz signed his first bill of the two-week-old 2024 legislative session on Monday, a correction to last year’s main tax bill that could have cost Minnesota taxpayers around $350 million next year.

The governor signed the bill with little fanfare, just a short statement from his office. Last year’s bill inadvertently used the standard deduction amount from 2019 as the starting point for 2024 state personal income taxes, instead of the proper inflation-adjusted amounts.

The bill signed Monday was framed as a “technical tax corrections bill” and passed both chambers last week with almost unanimous bipartisan support, even though Republicans objected because it didn’t also fix another known error in the 2023 tax bill. That one involves a business deduction for net operating losses that could cost some companies nearly $15 million this year if the effective date isn’t corrected. Democratic leaders have said they’ll fix that later.

The corrections bill wouldn’t have affected tax filers this year, and the correct standard deductions are already baked into the updated budget forecast coming later this week that will give lawmakers the final numbers on how much more money, if any, they’ll be able to spend this session.

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