According to the Minnesota Department of Revenue COVID-19 webpage, although the filing deadlines for state income tax withholding (SITW) returns and payments are not extended, employers unable to timely file and pay may request an abatement of interest and penalties if they have reasonable cause, such as the adverse impacts of COVID-19.

Guidelines for abatement of penalty and interest

After receipt of a notice of penalties, employers may ask the Department to abate late-payment or late-filing penalties or interest if they have been adversely affected by COVID-19.

Circumstances that may support a business's request for an abatement include if you:

• Cannot take care of your affairs for a time because you or a member of your immediate family becomes seriously ill
• Become unable to pay your debts as they become due because you have a significant loss of income
• Lose your job, or your business has to close, which makes?paying the tax an undue hardship
• Have a significant interruption of your business or employment and cannot manage it with?insurance or other financial resources
• Have a history of filing and paying your taxes on time
• Make any partial payments of tax on or near the due date
• Pay any underpayment of tax as soon as you:
  • Are financially able to so
  • Become aware of the underpayment

A business must show reasonable cause for filing or paying late, generally resulting from circumstances beyond the business's control or from a first-time occurrence. Note, however, that under Minnesota tax law (Minnesota Statute 270C.34) interest is rarely abated.

The business must send a written request within 60 days of the date on the first notice of penalty the Department has mailed to the business. Businesses do not need to pay tax or interest before requesting an abatement if the request is timely made.

The request must include:

• A statement that the business is requesting an abatement
• The business representative's name and contact information
• The business name
• The business Federal Employer Identification Number (FEIN) or Minnesota Tax ID Number
• The tax types and periods included in the request
• The reason the Department should abate the penalty
• Supporting documentation

See the Department's abatement webpage for where to send the request.

The Department will notify you by mail of its decision on your abatement request. If you don't receive the Department's decision within 45 days of request, contact the Department by email (see the webpage for the contact form) or by calling +1 651 556 3000 or +1 800 657 3666.

If the Department has not responded within 60 days, you may appeal to the Minnesota Tax Court.

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