1.1 A bill for an act
1.2 relating to child support; adding independent contractors and payors to the
1.3 centralized work reporting system; requiring payors to report independent
1.4 contractors to the centralized work reporting system; amending Minnesota Statutes
1.5 2024, sections 142A.29, subdivisions 1, 2, 3, 4, 6; 518A.53, subdivision 5; repealing
1.6 Minnesota Statutes 2024, section 142A.29, subdivision 9.
1.7BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.8 Section 1. Minnesota Statutes 2024, section 142A.29, subdivision 1, is amended to read:
1.9 Subdivision 1.Definitions.(a) The definitions in this subdivision apply to this section.
1.10 (b) "Date of hiring" means the earlier of: (1) the first day for which an employee or
1.11independent contractor is owed compensation by an employer or payor; or (2) the first day
1.12that an employee or independent contractor reports to work or performs labor or services
1.13for an employer or payor.
1.14 (c) "Earnings" means payment owed by an employer for labor or services rendered by
1.15an employee or independent contractor.
1.16 (d) "Employee" means a person who resides or works in Minnesota, performs services
1.17for compensation, in whatever form, for an employer and satisfies the criteria of an employee
1.18under chapter 24 of the Internal Revenue Code. Employee does not include:
1.19 (1) persons hired for domestic service in the private home of the employer, as defined
1.20in the Federal Tax Code; or
1.21 (2) an employee of the federal or state agency performing intelligence or
1.22counterintelligence functions, if the head of such agency has determined that reporting
1Section 1.
REVISOR DTT H1316-1HF1316 FIRST ENGROSSMENT
State of Minnesota
This Document can be made available
in alternative formats upon request
HOUSE OF REPRESENTATIVES
H. F. No. 1316
NINETY-FOURTH SESSION
Authored by Curran02/20/2025
The bill was read for the first time and referred to the Committee on Children and Families Finance and Policy
Adoption of Report: Amended and re-referred to the Committee on Judiciary Finance and Civil Law03/24/2025 2.1according to this law would endanger the safety of the employee or compromise an ongoing
2.2investigation or intelligence mission.
2.3 (e) "Employer" means a person or entity located or doing business in this state that
2.4employs one or more employees for payment, and satisfies the criteria of an employer under
2.5chapter 24 of the Internal Revenue Code. Employer includes a labor organization as defined
2.6in paragraph (g) (h). Employer also includes the state, political or other governmental
2.7subdivisions of the state, and the federal government.
2.8 (f) "Hiring" means engaging a person to perform services for compensation and includes
2.9the reemploying or return to work of any previous employee who was laid off, furloughed,
2.10separated, granted a leave without pay, or terminated from employment when a period of
2.1160 days elapses from the date of layoff, furlough, separation, leave, or termination to the
2.12date of the person's return to work.
2.13 (g) "Independent contractor" means a person over 18 years of age, or a corporation or
2.14limited liability company with a sole shareholder or member, who performs services for
2.15compensation in an amount equal to or greater than $600 per calendar year, to another
2.16person or entity doing business in this state. Independent contractor includes but is not
2.17limited to a person who logs in as a driver to the digital network of a transportation company
2.18doing business in this state or of a company operating a network in this state to facilitate
2.19delivery of food, goods, or services. Independent contractor does not include domestic
2.20service in the private home of the service recipient.
2.21 (g) (h) "Labor organization" means entities located or doing business in this state that
2.22meet the criteria of labor organization under section 2(5) of the National Labor Relations
2.23Act. This includes any entity, that may also be known as a hiring hall, used to carry out
2.24requirements described in chapter 7 of the National Labor Relations Act.
2.25 (h) (i) "Payor" means a person or entity located or doing business in Minnesota who
2.26pays money to an independent contractor according to an agreement for the performance
2.27of services.
2.28 EFFECTIVE DATE.This section is effective July 1, 2026.
2.29 Sec. 2. Minnesota Statutes 2024, section 142A.29, subdivision 2, is amended to read:
2.30 Subd. 2.Work reporting system established.The commissioner of children, youth,
2.31and families shall establish a centralized work reporting system for the purpose of receiving
2.32and maintaining information from employers and payors on newly hired or rehired employees
2.33and independent contractors. The commissioner of children, youth, and families shall take
2Sec. 2.
REVISOR DTT H1316-1HF1316 FIRST ENGROSSMENT 3.1reasonable steps to inform the state's employers and payors of the requirements of this
3.2section and the acceptable processes by which employers and payors can comply with the
3.3requirements of this section.
3.4 EFFECTIVE DATE.This section is effective July 1, 2026.
3.5 Sec. 3. Minnesota Statutes 2024, section 142A.29, subdivision 3, is amended to read:
3.6 Subd. 3.Duty to report.Employers and payors doing business in this state shall report
3.7to the commissioner of children, youth, and families the hiring of any employee or
3.8independent contractor who resides or works in this state to whom the employer or payor
3.9anticipates paying earnings. Employers and payors shall submit reports required under this
3.10subdivision within 20 calendar days of the date of hiring of the employee or independent
3.11contractor.
3.12 Employers and payors are not required to report the hiring of any person who will be
3.13employed or paid for less than two months' duration; and will have gross earnings less than
3.14$250 per month.
3.15 EFFECTIVE DATE.This section is effective July 1, 2026.
3.16 Sec. 4. Minnesota Statutes 2024, section 142A.29, subdivision 4, is amended to read:
3.17 Subd. 4.Means to report.Employers and payors may report by delivering, mailing, or
3.18telefaxing a copy of the employee's or independent contractor's federal W-4 form or W-9
3.19form or any other document that contains the required information, submitting electronic
3.20media in a compatible format, toll-free telecommunication, or other means authorized by
3.21the commissioner of children, youth, and families that will result in timely reporting.
3.22 EFFECTIVE DATE.This section is effective July 1, 2026.
3.23 Sec. 5. Minnesota Statutes 2024, section 142A.29, subdivision 6, is amended to read:
3.24 Subd. 6.Sanctions.If an employer or payor fails to report under this section, the
3.25commissioner of children, youth, and families, by certified mail, shall send the employer
3.26or payor a written notice of noncompliance requesting that the employer or payor comply
3.27with the reporting requirements of this section. The notice of noncompliance must explain
3.28the reporting procedure under this section and advise the employer or payor of the penalty
3.29for noncompliance. An employer or payor who has received a notice of noncompliance and
3.30later incurs a second violation is subject to a civil penalty of $25 for each intentionally
3.31unreported employee or independent contractor. An employer or payor who has received a
3Sec. 5.
REVISOR DTT H1316-1HF1316 FIRST ENGROSSMENT 4.1notice of noncompliance is subject to a civil penalty of $500 for each intentionally unreported
4.2employee or independent contractor, if noncompliance is the result of a conspiracy between
4.3an employer or payor and an employee or independent contractor not to supply the required
4.4report or to supply a false or incomplete report. These penalties may be imposed and collected
4.5by the commissioner of children, youth, and families. An employer or payor who has been
4.6served with a notice of noncompliance and incurs a second or subsequent violation resulting
4.7in a civil penalty, has the right to a contested case hearing under chapter 14. An employer
4.8or payor has 20 days from the date of service of the notice, to file a request for a contested
4.9case hearing with the commissioner. The order of the administrative law judge constitutes
4.10the final decision in the case.
4.11 EFFECTIVE DATE.This section is effective July 1, 2026.
4.12 Sec. 6. Minnesota Statutes 2024, section 518A.53, subdivision 5, is amended to read:
4.13 Subd. 5.Payor of funds responsibilities.(a) An order for or notice of withholding is
4.14binding on a payor of funds upon receipt. Withholding must begin no later than the first
4.15pay period that occurs after 14 days following the date of receipt of the order for or notice
4.16of withholding. In the case of a financial institution, preauthorized transfers must occur in
4.17accordance with a court-ordered payment schedule.
4.18 (b) A payor of funds shall withhold from the income payable to the obligor the amount
4.19specified in the order or notice of withholding and amounts specified under subdivisions 6
4.20and 9 and shall remit the amounts withheld to the public authority within seven business
4.21days of the date the obligor is paid the remainder of the income. The payor of funds shall
4.22include with the remittance the Social Security number of the obligor, the case type indicator
4.23as provided by the public authority and the date the obligor is paid the remainder of the
4.24income. A payor of funds may combine all amounts withheld from one pay period into one
4.25payment to each public authority, but shall separately identify each obligor making payment.
4.26 (c) A payor of funds shall not discharge, or refuse to hire, or otherwise discipline an
4.27employee as a result of wage or salary withholding authorized by this section. A payor of
4.28funds shall be liable to the obligee for any amounts required to be withheld. A payor of
4.29funds that fails to withhold or transfer funds in accordance with this section is also liable
4.30to the obligee for interest on the funds at the rate applicable to judgments under section
4.31549.09, computed from the date the funds were required to be withheld or transferred. A
4.32payor of funds is liable for reasonable attorney fees of the obligee or public authority incurred
4.33in enforcing the liability under this paragraph. A payor of funds that has failed to comply
4.34with the requirements of this section is subject to contempt sanctions under section 518A.73.
4Sec. 6.
REVISOR DTT H1316-1HF1316 FIRST ENGROSSMENT 5.1If the payor of funds is an employer or independent contractor and violates this subdivision,
5.2a court may award the obligor twice the wages lost as a result of this violation. If a court
5.3finds a payor of funds violated this subdivision, the court shall impose a civil fine of not
5.4less than $500. The liabilities in this paragraph apply to intentional noncompliance with
5.5this section.
5.6 (d) If a single employee is subject to multiple withholding orders or multiple notices of
5.7withholding for the support of more than one child, The payor of funds shall comply with
5.8all of the withholding orders or notices to the extent that the total amount withheld from
5.9the obligor's income does not exceed the limits imposed under the Consumer Credit
5.10Protection Act, United States Code, title 15, section 1673(b), giving priority to amounts
5.11designated in each order or notice as current support as follows:
5.12 (1) if the total of the amounts designated in the orders for or notices of withholding as
5.13current support exceeds the amount available for income withholding, the payor of funds
5.14shall allocate to each order or notice an amount for current support equal to the amount
5.15designated in that order or notice as current support, divided by the total of the amounts
5.16designated in the orders or notices as current support, multiplied by the amount of the income
5.17available for income withholding; and
5.18 (2) if the total of the amounts designated in the orders for or notices of withholding as
5.19current support does not exceed the amount available for income withholding, the payor of
5.20funds shall pay the amounts designated as current support, and shall allocate to each order
5.21or notice an amount for past due support, equal to the amount designated in that order or
5.22notice as past due support, divided by the total of the amounts designated in the orders or
5.23notices as past due support, multiplied by the amount of income remaining available for
5.24income withholding after the payment of current support.
5.25 (e) When an order for or notice of withholding is in effect and the obligor's employment
5.26is terminated, the obligor and the payor of funds shall notify the public authority of the
5.27termination within ten days of the termination date. The termination notice shall include
5.28the obligor's home address and the name and address of the obligor's new payor of funds,
5.29if known.
5.30 (f) A payor of funds may deduct one dollar from the obligor's remaining salary for each
5.31payment made pursuant to an order for or notice of withholding under this section to cover
5.32the expenses of withholding.
5.33 EFFECTIVE DATE.This section is effective July 1, 2026.
5Sec. 6.
REVISOR DTT H1316-1HF1316 FIRST ENGROSSMENT 6.1 Sec. 7. REPEALER.
6.2 Minnesota Statutes 2024, section 142A.29, subdivision 9, is repealed.
6.3 EFFECTIVE DATE.This section is effective July 1, 2026.
6Sec. 7.
REVISOR DTT H1316-1HF1316 FIRST ENGROSSMENT 142A.29 WORK REPORTING SYSTEM.
Subd. 9.Independent contractors.The state and all political subdivisions of the state, when
acting in the capacity of an employer, shall report the hiring of any person as an independent
contractor to the centralized work reporting system in the same manner as the hiring of an employee
is reported.
Other payors may report independent contractors to whom they make payments that require the
filing of a 1099-MISC report. Payors reporting independent contractors shall report by use of the
same means and provide the same information required under subdivisions 4 and 5. The
commissioner of children, youth, and families shall establish procedures for payors reporting under
this section.
1R
APPENDIX
Repealed Minnesota Statutes: H1316-1