Minnesota employer tax information
About Minnesota employer tax information
With Square, you can run payroll, pay your taxes and stay ahead of the compliance to focus on running your business. This guide is intended for your state taxes only. It’s important to note that laws vary by jurisdiction, and this guide does not attempt to address all jurisdictions or federal taxes — for example, counties or cities often have requirements that differ from federal and state law.
Before you begin
To sign up for Square Payroll in Minnesota, you must be registered with the Minnesota Department of Revenue and Unemployment Insurance Minnesota so we can pay and file your state taxes.
For Minnesota Department of Revenue, you need your:
Minnesota Withholding Tax ID Number (7 digits)
For Unemployment Insurance Minnesota, you need your:
Minnesota Unemployment Insurance Account Number (8 digits)
Minnesota UI Tax Rate
Minnesota payroll tax information details
Square Payroll processes the following per the frequency for the listed state agencies.
Minnesota Department of Revenue
Withholding Tax Payment (MW5): processes per pay run
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Withholding Reconciliation (Form MW1): processes quarterly
Square Payroll only supports filing Form MW1 on a quarterly frequency. If you are currently registered to file Form MW1 on an annual frequency, please contact the Department of Revenue to request a change to the quarterly filing requirement.
Wage and Tax Statement (W-2): processes annually
Unemployment Insurance Minnesota
Unemployment Insurance Payment/Filing (Form MDES-1): processes quarterly
Minnesota Department of Human Services
New Hire Reporting: processes per new employee
Make Minnesota payroll tax payments
To make Minnesota Withholding tax payments, you must be registered with the Minnesota Department of Revenue (DOR) and have a Minnesota Withholding Tax ID Number. You can register with the DOR and obtain a tax ID by visiting the Minnesota Department of Revenue Business Tax Registration page.
- To pay online, sign in to the MN e-Services website or submit an Electronic Funds Transfer (EFT). If submitting by EFT, contact your bank to request a bill payment via ACH. You will need to contact the Minnesota DOR to obtain their bank account information. For more information, visit the Minnesota DOR website.
- To pay by phone, call the MN Department of Revenue Telephone File and Pay System at 800-570-3329.
- To pay by mail, go to the MN Payment Voucher System to create a voucher and submit with your check or money order payment. You will need your tax ID, taxpayer name, taxpayer mailing address, and payment amount. Mail your check or money order along with your voucher to the address listed on your voucher.
For questions regarding Minnesota Withholding Tax payments, call 651-282-9999 or 800-657-3594, or send an email to withholding.tax@state.mn.us.
To make Minnesota Unemployment Insurance tax payments, you must be registered with the Minnesota Department of Employment and Economic Development (DEED) Unemployment Insurance (UI) Program and have a Minnesota Unemployment Insurance Account Number. You can register for an employer account at the Minnesota UI Program website.
There are two options for making unemployment insurance tax payments. You are required to pay electronically if you have 50 or more employees for the given calendar quarter.
- To pay online:
- Sign in to the Minnesota Unemployment Insurance System.
- Select Payment Information > Account Summary.
- On the Make Payment screen, select Electronic Check from the drop-down menu, and enter your bank account information to make an ACH debit payment.
To pay by mail:
- Sign in to the Minnesota Unemployment Insurance System.
- Select Payment Information > Account Summary.
- On the Make Payment screen, select Paper Check from the drop-down menu to create a payment voucher.
- Mail check and payment voucher to the address listed on your voucher.
For questions regarding Minnesota Unemployment Insurance tax payments, call 651-296-6141.
Make payroll withholding tax filings
Quarterly withholding tax returns are due by the last day of the month following the end of the calendar quarter (for example, due on April 30 for the first quarter). Paper returns are not accepted.
To file online, use the e-Services section of the DOR website.
For questions about withholding tax payments, contact the Minnesota Department of Revenue at 651-282-9999 or withholding.tax@state.mn.us.
W-2s are due by January 31 for the preceding calendar year. If you have a total of more than 10 forms (W-2s plus 1099s), you must electronically submit the information to the Minnesota Department of Revenue. If you have 10 or less forms (W-2s plus 1099s), you may submit paper copies.
To file online, use the e-Services section of the DOR website.
For questions about withholding tax payments, contact the Minnesota Department of Revenue at 651-282-9999 or withholding.tax@state.mn.us.
Make unemployment insurance tax filings in Minnesota
Unemployment insurance tax reports and payments are due by the last day of the month following the end of the calendar quarter (for example, on April 30 for the first quarter).
- To file online, use the State of Minnesota’s Unemployment Insurance website. You can also use this site to file and pay your quarterly unemployment taxes.
- To file by phone, use the State of Minnesota’s Unemployment Insurance website instructions. Businesses and organizations without internet access who report either $0 wages or wages for very few employees can file by phone.
You must file quarterly returns even if no contributions are due. As long as you have an active unemployment insurance account, you must file reports every quarter by the due date. If you are liable for unemployment insurance taxes for any part of a calendar year, you are liable for the entire year and must file quarterly reports for the entire year.
If you believe your business no longer meets the qualifications for unemployment insurance tax, you must notify Minnesota Unemployment Insurance. In such cases, you must continue to file quarterly contribution and wage reports until you are notified that your account has been made inactive. You will be subject to a penalty if you fail to file.
For more information on state unemployment taxes, contact Minnesota Unemployment Insurance at 877-898-9090 or visit the Minnesota Unemployment Insurance website.
Amend duplicate tax filings in Minnesota
The Minnesota Department of Employment and Economic Development allows you to re-file any misreported payroll on your quarterly MDES-1 filing by submitting an amended return. Here are some general guidelines for completing your adjusted return:
- Log in to MN Employer Services.
- Obtain a copy of the Form MDES-1 that was originally filed. Use this to complete the “Previously reported” section of the amendment.
- Make necessary corrections to the original file located on your computer, then resubmit the file by selecting the button “Make file corrections.”
File your Form MDES-1 with the Dept. of Employment and Economic Development as soon as possible to avoid unnecessary penalties or fees from underreporting your wages and taxes.
If you have any questions, contact the Minnesota Dept. of Employment and Economic Development at 651-296-6141, contact them at 800-814-1252 for accessibility options, or visit the Minnesota Unemployment Insurance website.
Register as a new employer in Minnesota
Register with the Minnesota Department of Revenue as a new business. You will receive your Withholding Tax ID Number immediately after completing the registration online.
Register on the Minnesota Unemployment Insurance website as a new employer. You will receive your Unemployment Insurance Account Number immediately after completing the registration online.
If you are unsure of your rate, contact the agency at 651-296-6141. In addition to your UI Tax Rate, you will be charged for an additional Workforce Development Assessment that is standard for all Minnesota employers.
Find your Minnesota tax ID numbers and rates
You can find your Withholding Account ID on the Minnesota Department of Revenue website or on any notice you have received from the Department of Revenue.
If you’re unable to locate this, contact the agency at 651-282-9999.
You can find your Unemployment Insurance Account Number on the Determination of Tax Rate Notice mailed by Unemployment Insurance MN.
If you’re unable to locate this, contact the agency at 651-296-6141.
If your account number is 7 digits long, add a zero to the beginning when entering in Square Payroll.
You can find your UI tax rate on the Determination of Tax Rate Notice mailed by Unemployment Insurance MN. In addition to your UI Tax Rate, you will be charged for an additional Workforce Development Assessment that is standard for all Minnesota employers.
If you’re unable to locate this, contact the agency at 651-296-6141.
Authorize Square Payroll as your unemployment insurance tax agent
To file and pay your Minnesota unemployment insurance taxes, Square Payroll needs to be authorized as your agent.
Follow the instructions on the Unemployment Insurance Minnesota website to authorize Square Payroll.
You can complete the whole process on Unemployment Insurance Minnesota website and you will need the following information:
Square Payroll Minnesota UI Agent ID: AG017550
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Roles to assign to Square Payroll:
Account Maintenance Update and Submit
Tax Payment Update and Submit
Wage Detail Update and Submit
You will need to unauthorize any previous agents/payroll providers who had the above roles.
Payroll reciprocal state agreements
A reciprocal agreement is an agreement between two states that allows employees that work in one state but live in another to request exemption from tax withholding in their employment state. This means that the employee would not have income tax withheld from their paycheck for their employment state; they would only pay income taxes to the state where they live.
A Non-Residency Certificate (or statement or declaration), is used to declare that an employee is a resident of a state which has a reciprocal agreement with their work state and therefore chooses to be exempt from withholding income tax in their work state. A non-resident employee qualifying for this exemption must complete and file this declaration with his or her employer as authorization for the employer to stop withholding state income taxes where the employee works. Employers should keep the non-residency certificate on file.
Minnesota has reciprocal agreements with:
Michigan
North Dakota
Non-resident employees should file Form MWR.