Budget surplus rebate checks will be taxed federally, in what Minnesota Gov. Walz calls “Bull(bleep)”

Minnesota residents will get taxed on their rebate checks that came from the state.

More than two million got checks between $260 to $1,300, as part of the state’s $3 billion 2024 budget signed into law by Gov. Tim Walz last May.

The Minnesota Department of Revenue said the rebates — while not taxable in in the state — will be taxed by the IRS federally.

Depending on the amount of the rebate, and an individual’s federal tax bracket, recipients may be liable for between $26 and $286.

What it means is Minnesotans will have more complicated taxes to file next year, needing form 1099-MISC.

“Taxpayers should use the information on (that) form when filing their 2023 income tax return,” Minnesota’s Department of Revenue tried to explain. “If they include this payment in their federal adjusted gross income, they should subtract it from their Minnesota taxable income on line 33 of Schedule M1M on their Minnesota return.”

Walz called the news from the feds “bull(bleep),” as the state apparently missed some deadline by two weeks for it to not get taxed.