M2SBNC: Federal Adjustments (2024)
Minnesota · Minnesota DOR · Used for tax years 2024
Minnesota Schedule M2SBNC reports adjustments to a trust’s 2024 federal taxable income for federal tax law changes Minnesota has not adopted. The total adjustment is carried to Form M2SB, and the schedule must be included when filing that form.
Who files this form
Use Schedule M2SBNC if any federal provisions in H.R. 1 affect the taxable income reported on your 2024 federal Form 1041. The text requires an income adjustment on your 2024 Minnesota return for those changes.
Each adjustment compares the amount calculated on your federal return with the amount calculated under the Internal Revenue Code as amended through May 1, 2023. Include any net adjustments from Schedule KSNC for your pro rata share in an S corporation.
What you'll need
- Your 2024 federal Form 1041 and Minnesota Form M2SB.
- Any Schedule KSNC showing adjustments for your pro rata share in an S corporation.
- Worksheets used to calculate your adjustments.
- Statements showing depreciation calculations for amounts reported on lines 1b, 2b, 2c, 3b, 8b, and 10a, as applicable.
- A statement showing the calculation of any amount entered on line 16 for other adjustments to federal taxable income.
Save your entire 2024 Form M2SB, Schedule M2SBNC, and all worksheets used to determine the adjustments.
How to file
Include Schedule M2SBNC when you file Form M2SB. Attach the calculation statements required for the lines you complete.
The supplied text does not give a mailing address or e-filing directions.
Common mistakes
- Completing the schedule without first reading its instructions. The form specifically tells you to read them before starting.
- Using the wrong sign. Enter an adjustment that reduces federal taxable income as a negative number and one that increases it as a positive number.
- Not rounding amounts to the nearest whole dollar.
- Leaving Schedule M2SBNC out when filing Form M2SB.
- Not saving your full 2024 Form M2SB, Schedule M2SBNC, and adjustment worksheets.
Questions people ask
Why are federal adjustments needed?
Minnesota has not adopted federal law changes enacted after May 1, 2023 that affect federal taxable income for tax year 2024. This schedule calculates adjustments needed to determine Minnesota taxable income.
How do I calculate an adjustment?
Compare the item calculated on your 2024 federal return with the item calculated under the Internal Revenue Code as amended through May 1, 2023. Report the resulting change to federal taxable income.
Do I include adjustments received from an S corporation?
Yes. Each applicable line also includes the net adjustments received on Schedule KSNC for your pro rata share in an S corporation.
Do depreciation adjustments need supporting statements?
Yes. The instructions require a statement showing the depreciation calculation for amounts reported on lines 1b, 2b, 2c, 3b, 8b, and 10a.