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Tax-reciprocity deal returns to forefront

Wisconsin News

Revenue officials in Wisconsin and Minnesota are getting closer to an agreement that would make life simpler for about 80,000 people who live in one state and work in the other. Those folks have had to file income tax returns to both states the past couple years. That's after former Minnesota Governor Tim Pawlenty scrapped a long-time tax reciprocity agreement, in which border crossers only had to file in their home states.

Wisconsin normally pays Minnesota for the revenue the Gopher State loses under the deal. Now, revenue officials in both states agree that the Badger State owes about $69 million. But a sticking point remains. Minnesota wants Wisconsin to pay an extra $6 million a year to cover differences in tax credits that both states offer. Revenue commissioners in both states disagree on whether it's a fair shake for their residents.