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Minnesota-Wisconsin tax reciprocity deal stalls

Plans to reinstate a tax reciprocity deal between Minnesota and Wisconsin have stalled.

The deal would allow taxpayers who live in one state and work in the other to file just one state income tax return. The accounting gurus in the two state governments would then sort things out.

But, the Associated Press reports, the states can’t agree on how much Wisconsin will owe Minnesota, because more Wisconsin residents work in Minnesota.

A previous reciprocity deal was canceled in 2009, when then-Gov. Tim Pawlenty complained that Wisconsin was too slow in repaying Minnesota.

Minnesota Revenue Commissioner Myron Frans told AP that a looming deadline on Monday for 2013 taxes was unlikely to be met. Wisconsin’s revenue chief agreed.

Each state is studying reciprocity, and by spring there should be more data available and negotiations will likely pick up again.

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