MNCPA Legislative Issues
2026 priorities
Pass-Through Entity Tax (PTET) (Updated March 2026)
Under current law, the PTET election in Minnesota expired for tax years beginning after Dec. 31, 2025. Without an extension, pass-through income will be taxed at the owner level, and owners will be subject to the federal SALT deduction limits on their personal returns. There is no cost to Minnesota and it will save an estimated $400 million in federal taxes for Minnesota taxpayers.
- Bills: Senate File 3405 | House File 3127
- Position: The MNCPA supports legislation to extend PTET election.
- Status: The Senate bill has moved to the full floor for a vote. The House bill has been laidover as an option to be included in an omnibus bill.
- Letter: MNCPA testimony submitted
Federal tax conformity (Updated March 2026)
Federal conformity simplifies compliance, reduces errors and costs, and improves predictability, which benefits taxpayers and tax professionals. The MNCPA supports federal conformity as a general rule. Selected federal tax changes in OBBBA that create conformity opportunities include R&E expenditures, bonus depreciation, Section 179 expensing, business interest limitation, and targeted income deductions (e.g., overtime pay, tip income and senior subtraction).
- Bills:
- House File 3814 | Individual income and corporate franchise taxes; federal changes to section 179 expensing conformed.
- House File 3815 | Individual income and corporate franchise taxes; federal changes to the deduction for business interest conformed.
- House File 3816 | Individual income and corporate franchise taxes; federal changes to expensing research expenditures conformed.
- House File 3817 | Individual income and corporate franchise taxes; federal changes to bonus depreciation conformed.
- Position: The MNCPA supports legislation that aligns state tax law with the federal tax code.
- Letter: MNCPA testimony submitted for HF 3816
Individual mobility correction for CPA licensure (Added February 2026)
In the 2025 session, legislation was passed to broaden the pathways to CPA licensure and shift CPA mobility from state-based mobility to individual mobility.
Individual mobility guardrails were included to ensure CPAs without a Minnesota license who are allowed practice privileges in Minnesota must have passed the CPA exam and hold at least a bachelor's degree. It was discovered after the legislation passed that a small number of CPAs who currently have mobility would lose mobility in Minnesota under the new requirements. For example, New York allows an individual who passes the CPA exam with 15 years of experience to become a CPA without earning a college degree. These CPAs, who currently have the ability to pracitice in Minnesota under state-based mobility, would lose practice privileges.
- Bills: The MNCPA will introduce a bill to correct individual mobility as it relates to CPA licensure.
- Position: The MNCPA supports licensure mobility correction.
CPA firm mobility (Added February 2026)
Currently, Minnesota requires CPA firms to obtain a license to do attest work in the state. Thirty-four states have firm mobility, which works the same as individual mobility. A firm holding a firm permit in good standing from another state can operate in Minnesota and is subject to the state's rules and under the jurisdiction of the Minnesota Board of Accountancy while practicing in Minnesota.
Adding firm mobility aligns with other states and improves compliance while still providing regulatory oversight to the BOA.
- Bills: MNCPA is drafting a bill to add firm mobility.
- Position: Support the BOA by introducing legislation to allow firm mobility to CPA firms who are not located in Minnesota but hold a firm permit in good standing from another state.
Minnesota Tax Court rulings (Updated September 2025)
The MNCPA supports legislation to amend current statute and clarify who is bound by Tax Court decisions and how the decisions can be appealed.
Revenue rulings (Updated March 2026)
The bill clarifies the role of revenue rulings as the Minnesota Department of Revenue's primary published interpretations of Minnesota tax statutes and rules.
Tax on professional services (Updated September 2025)
Extending the sales tax to accounting services is part of the governor’s proposal to lower the sales tax rate and broaden the base; but, in doing so, it would also increase tax collections by the state. This proposal is overly broad and creates significantly more questions than should be part of a new proposed tax law.
Other issues
Mobile workforce (Updated September 2025)
Uniform withholding requirements reduce complexity, reduce the compliance cost for taxpayers and administrators and increase the ease of filing.
Trust residency (Updated September 2025)
Using the location of an adviser as a determining factor to establish trust residency will result in a loss of business for Minnesota based trusts.
Minnesota Paid Leave (Added March 2026)
This bill would make certain S Corporations exempt from the Minnesota Paid Leave program.
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