Level 4

MN property tax household income

Forum|Forum|10 months ago
August 12, 2025
1 reply
6 views

Client received notice that they did not qualify for their 2021 property tax refund. The difference is that they are not allowing the rental loss in household income. Sent MN a letter protesting and they received further correspondence that their appeal was denied. (The letter actually says "You must include in household income Schedule E passive rental losses on your federal income tax return.") It was included on the federal return. That loss carried over to household income. They seem to be adding it back.

Any suggestions on where to go from here?

IRonMaN

Level 15

"Any suggestions on where to go from here?"

Time to surrender.

Required addbacks from the 2021 instructions:

Also include these losses and deductions to the extent they
reduced federal adjusted gross income:
• Capital loss carryforward (use Worksheet 4 on page 30 to compute
amount)
• Educator expenses
• Health savings account and Archer MSA deductions
• Net operating loss carryforward/carryback
• Passive activity losses in current year in excess of current year
passive activity income, including rental losses, even if actively
involved in real estate
• Prior year passive activity loss carryforward claimed in 2021 for
federal purpose

Slava Ukraini!