The 2012 legislative preview

Issues on the MNCPA’s radar for the year ahead

Advocacy is a continuous process that builds relationships, shapes legislation and helps influence decision makers. Each year, the MNCPA develops a list of issues for its legislative agenda. This list guides advocacy efforts at the Capitol. We keep our agenda flexible, so we can adjust as issues arise.

The MNCPA legislative agenda begins with input from the MNCPA Legislative Issues Committee. This group meets throughout the year to discuss issues affecting the profession. Many of these issues come from discussions and experiences of other MNCPA members.

Once the committee develops an agenda, its recommendations go to the MNCPA Board of Directors to be approved, rejected or modified. Areas of focus for next year will likely include:

Federal conformity

In previous years, the MNCPA worked with Minnesota legislators to achieve some significant and incremental conformity with the alternative minimum tax. In 2011, limited estate tax conformity passed. We will continue to advocate for estate tax conformity, as well as section 179 expensing. Legislative leaders have indicated jobs and the economy will remain top priorities. This presents us with an opportunity to pursue conformity tied to jobs and section 179.

The state budget forecast will likely show another deficit. If conformity can be linked to job creation, it stands a better chance of passing.

The legislature will also look at possible reforms to state government. Conformity could be part of this discussion, too.

Tax on professional services

A tax on professional services has come up several times during the past 20 years. Expect it to surface again.

Legislators will likely face another budget deficit in 2012. Tax law reform could include lowering the sales tax and broadening the tax base. Placing a tax on services could be part of the budget balancing discussions in 2012.

CPA firms performing county audits

In 2004, the legislature gave the state auditor authority to permit counties to seek bids from CPA firms to conduct county audits. However, the legislation did not allow all counties to participate. Instead, certain counties were selected for a three-year pilot program. The original intention was to allow all counties the option after the pilot ended.

Many counties would like to seek competitive bids, but have not been allowed to do so. This issue came up during the 2011 session, but it wasn't included in the final budget resolution.

Minnesota Department of Revenue (DOR) audits

Since 2002, the legislature has increased funding for the Department of Revenue to hire more auditors to collect money owed to the state. Many of the new auditors lack experience, which frustrates MNCPA members, who feel they spend too much time helping these auditors through the process. The DOR is charged with returning a specific amount of money to the state, and the legislature may not fully understand the negative impact of inexperienced auditors in that process.

Gov. Dayton wants even more tax compliance and may propose funds to hire additional auditors in 2012. Those new auditors could be aided by new tax analytics software that makes the audit selection process more efficient. The pursuit of tax analytics software resulted from legislation passed during the last session.

Tort reform

In 2011, tort reform legislation passed in the Senate, but not the House. For 2012, the MNCPA will push to ensure both the tort and contract statutes are the same, if any changes are made.


  • The MNCPA joined the Minnesotans for Lawsuit Reform coalition and will pursue tort reform benefitting CPAs, including:
  • Statute of limitations reduced from six to four years
  • Joint and several liability
  • Pre/post judgment interest rates
  • Third-party financing of litigation costs

Board of Accountancy (BOA) budget

Future cuts to the BOA's budget could result in diminished service to the profession. This includes longer response times, less regulatory oversight and increased registration fees. If the BOA is unable to adequately regulate the profession, it could negatively impact the reputation and integrity of CPAs.

Legislation to increase fees was introduced in 2011, and the BOA will likely push for a fee increase to maintain its existing operations.

You can make a difference

For more information about the 2012 MNCPA legislative agenda visit

As an MNCPA member and a trusted advisor in your community, you can strengthen the MNCPA's positions by telling us what issues are important to you. Together, we can support the CPA profession.

Please contact Geno Fragnito at or 952-885-5550 with comments or suggestions.

MNCPA legislative activities

Subscribe to the Legislative Digest
The MNCPA Legislative Digest will connect you with relevant and valuable news on what is going on in our advocacy efforts. Learn about which bills are being passed through Congress and our victories relating to the issues important to CPAs.

CPA Lobby Day - Supporting CPAs in Minnesota
Each year members from across Minnesota gather at the Capitol to meet with their legislators and educate them on issues impacting the CPA profession. CPA Lobby Day, usually held in February, allows members to learn more about the legislative process and meet one-on-one with state legislators.