Minnesota K-12 Education Credit

The Minnesota Department of Revenue issued a reminder on it's Weekly Digest Bulletin about problems they are having with taxpayers claiming the K-12 education credit for items that do not qualify.

Here is what their bulletin said:
Minnesota offers a refundable education credit that reduces a taxpayer's income tax liability.  Taxpayers who meet the criteria can qualify to claim it.  We frequently see expenses claimed that do not qualify for the credit. Avoiding these common errors will help the taxpayer get their refund sooner.
Examples of expenses we see taxpayers claiming that DO NOT qualify include:
School uniforms including choir, band, dance, and graduation robes,
Fees for athletic programs including swimming and gymnastics,
PSAT, ACT, and SAT testing fees,
Computer hardware and/or software claimed for the full value (expenses are limited to $200 on line 14 of the M1ED),
Recreational programs such as Boy Scouts and Girl Scouts.

What they didn't say is that because a majority of the claims for this credit claim the credit for ineligible expenses, each one of these claims is manually examined (audited).  This was true some years ago and I don't know if it's still true, but this has been an ongoing problem for the MN Dept of Revenue. When I was a member of the MN House of Representatives during the Ventura years, the Department of Revenue wanted to repeal this credit because of the administrative headaches caused by all the ineligible claims.

Mark S Gleason CPA
www.lakes-cpa.com