Minnesota Tax on Lump-Sum Distribution

Tax on Lump-Sum Distribution
2023 M1LS, Tax on Lump-Sum Distribution
2023 Schedule M1LS, Tax on Lump-Sum Distribution
Your First Name and Initial

Last Name

*231801*

Social Security Number

You must complete federal Form 4972 before you can complete this schedule.

Round amounts to the
nearest whole dollar.

1	 Portion	of	your	lump-sum	distribution	that	is	eligible	for	averaging	(from line 19 of federal Form 4972)  .  .  .  .  .  .  .  .  .  .  . 1
2	 If	you	completed	Schedule	M1R,	see	instructions.	If	you	did	not	complete	Schedule	M1R,	enter	0  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 2
3	 Subtract	line	2	from	line	1	  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 3
4	 Multiply	line	3	by	20%	(.20)	 .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 4
5	 From	the	tax	table	in	the	Form	M1	instructions,	find	the	tax	for	the	amount
on	line	4	above	using	the	column	in	the	table	for	single	persons	  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 5
6	 Multiply	line	5	by	5	  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 6
If	you	did	not	complete	lines	20	through	22	of	federal	Form	4972,	skip	lines	7	through	10	below,	
and	enter	the	amount	from	line	6	on	line	11	of	this	schedule.	
7	 Amount	from	line	22	of	federal	Form	4972	  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 7
8	 Multiply	line	7	by	20%	(.20)	 .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 8
9	 From	the	tax	table	in	the	Form	M1	instructions,	find	the	tax	for	the	amount
on	line	8	above	using	the	column	for	single	persons	  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 9
10	 Multiply	line	9	by	5	  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 10
11	 Tax	on	the	ordinary	income	portion	of	your	lump-sum	distribution	(subtract	line	10	from	line	6).
If	you	shared	the	lump-sum	distribution	with	other	recipients,	see	instructions.	
Enter	the	result	here	and	on	line	14	of	Form	M1.	Check	the	box	for	Schedule	M1LS	on	line	14	of	Form	M1.
Estates	and	trusts:	Include	this	amount	on	line	12	of	Form	M2	and	check	the	box	for	Schedule	M1LS  .  .  .  .  .  .  .  .  .  .  .  . 11

You must include this schedule and a copy of your federal Form 4972 when you file Form M1.

9995

2023 Schedule M1LS Instructions
Should I file Schedule M1LS?

You must file Schedule M1LS if all of these apply:
• You received a lump-sum distribution from a pension, profit-sharing, or stock bonus plan in 2023.
• You filed federal Form 4972, Tax on Lump-Sum Distributions.
• You were a Minnesota resident when you received any portion of the lump-sum distribution.
You must include Schedule M1LS and a copy of Form 4972 when you file Form M1.

What if I moved into or out of Minnesota in 2023?
Complete this schedule if you were a Minnesota resident when you received any portion of the distribution.
If you received a portion while you were a nonresident and a portion while you were a resident, you must complete Schedule M1LS and
include the full amount from federal Form 4972 on this schedule.

Five-Year Averaging Method

Although federal Form 4972 allows you to use only the ten-year averaging method, you must use the five-year averaging method for
Minnesota.

Capital Gain Election

Minnesota does not allow a capital gain election for lump-sum distributions. You must report any capital gain election on Form 4972, line 6,
as an addition to federal taxable income on line 4 of Schedule M1M, Income Additions and Subtractions.

Line Instructions

Round amounts to the nearest whole dollar.

Line 2 — Subtraction for Age 65 or Older or Disabled

If you completed Schedule M1R, Age 65 or Older/Disabled Subtraction, and line 3 of Form M1 is:
• Zero or less, enter the amount from line 13 of Schedule M1R on line 2 of Schedule M1LS.
• More than zero, subtract line 8 from line 3 of Form M1, Individual Income Tax. If the result is:
• Zero or less, assume the result is positive rather than negative. Then, compare it (as a positive number) to the amount on line 13 of
Schedule M1R and enter whichever amount is less on line 2 of Schedule M1LS.
• More than zero, enter zero on line 2 of Schedule M1LS.

Line 11 — Tax on Ordinary Income Portion of Lump-Sum Distribution
Subtract line 10 from line 6 and enter the result on line 11.

Multiple recipients: If you shared a lump-sum distribution from a qualified retirement plan, follow these steps to determine line 11:
1 From the front of this schedule, subtract line 10 from line 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2 Enter the percentage from box 9a of federal Form 1099-R . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3 Multiply step 1 by the percentage in step 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Enter the result from step 3 on line 11 of Schedule M1LS. In the space to the left of line 11, print “MRD.”

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