State completes nearly all rebate payments by direct deposit, paper checks now being sent out

Rebate payments have begun being issued to Minnesotans, and the state’s Department of Revenue has provided an update on the number of payments that have been sent out since last week.

A spokesperson for the department tells 5 EYEWITNESS NEWS that at the start of the payments, the state estimated they would need to send 1.15 million rebates through direct deposit and an additional 950,000 payments by paper checks. However, the number of paper checks will change due to direct deposit attempts that fail or are kicked back.

Through Wednesday, Aug. 23, the state had attempted to issue roughly 1.1 million direct deposit payments. Out of those attempts, 50,000 failed, or were kicked back, resulting in those payments now needing to be issued by paper check.

The state had also mailed out 170,000 checks to Minnesotans as of Wednesday.

According to the department’s spokesperson, the IRS still hasn’t issued a ruling on whether the rebates will be taxed at the federal level.

5 EYEWITNESS NEWS previously reported on Tuesday, Aug. 15 that payments would begin that same week to more than two million households. However, it’s important to note that state officials said payments would be sent out throughout the month of September.

The Department of Revenue says it is starting with payments to those who had direct deposit set up when filing their 2021 tax year documents with the state.

If you didn’t have direct deposit set up for that tax season, you will be mailed a paper check. You will also get sent a paper check if a direct deposit gets kicked back for various reasons, including if bank or address information wasn’t updated earlier this year with the state. As previously reported by 5 EYEWITNESS NEWS, that information had to be updated before 5 p.m. on Friday, July 28, 2023.

RELATED: Website opens for Minnesota taxpayers to update bank, address ahead of state rebate payment

The Department of Revenue’s spokesperson adds the department is doing a review of information that was submitted for the payments in order to verify the identity, eligibility, and payment amounts being sent to eligible Minnesotans.

In order to be eligible for the rebate payment, you have to meet multiple requirements:

  • Be a resident of Minnesota in 2021 and either filed a tax return for 2021 or filed a renter’s property tax refund or a homestead credit refund by Dec. 31, 2022.
  • Not be a dependent on anyone else’s 2021 tax return.
  • Not have an adjusted gross income of more than $150,000 for joint-filers or more than $75,000 for single-filers.

If you haven’t received a payment by the end of September, you’re asked to contact the Department of Revenue.

RELATED: Minnesota officials plan to send direct rebate payments early this fall

The rebates are part of a payment plan approved during the last legislative session in the tax bill. CLICK HERE to read the bill’s full text.

Initially, Gov. Tim Walz proposed $1,000 for eligible Minnesotans. However, as previously reported by 5 EYEWITNESS NEWS, state lawmakers approved $260 for single tax filers or $520 for couples. Families who earn less than $35,000 will get $1,750 tax credits per child for up to three kids. Any child born after that time also won’t be eligible for the additional credit of $260 — which can be applied to up to three children — available under the law.