Badger, Gopher states bicker over tax payment
Wisconsin is a month-and-a-half late in paying $58 million to Minnesota. It's the final payment under an income-tax reciprocity agreement that former Minnesota Governor Tim Pawlenty canceled in 2009.
It allowed residents who live in one state and work in the other to file just one income tax return in their home state. And the state which lost money in the arrangement was always paid later by the other one.
Wisconsin was supposed to pay its latest bill for $58 million on December first. And according to the St. Paul newspaper, Minnesota's Democratic Governor Mark Dayton is preparing a letter to Wisconsin officials demanding the payment now.
Kit Borgman of the Minnesota Revenue Department says Wisconsin claims it can't pay up until its next fiscal year begins July first.
The Badger State has sizable deficits in both its current budget and the next one. Wisconsin Revenue Secretary Rick Chandler says the new Walker administration wants to revive the tax reciprocity, and it wants to work with the Gopher State to make it happen.
Chandler didn't say when - or if - Wisconsin would pay what it owes. Minnesota is also charging the Badger State $4,500 a day in interest. And that means Wisconsin could owe another million if it waits until July to pay up.
In the meantime, about 80,000 Wisconsin and Minnesota residents who work across the border must file two state tax returns this year.