HF 2985

as introduced - 82nd Legislature (2001 - 2002) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to taxation; providing a low-income housing 
  1.3             tax credit; proposing coding for new law in Minnesota 
  1.4             Statutes, chapter 290. 
  1.5   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.6      Section 1.  [290.0681] [LOW-INCOME HOUSING TAX CREDIT.] 
  1.7      Subdivision 1.  [CREDIT ALLOWED.] A taxpayer is allowed a 
  1.8   credit against the tax under section 290.06 for the taxable year 
  1.9   equal to the credit the taxpayer receives under section 42 of 
  1.10  the Internal Revenue Code for a building located in a distressed 
  1.11  area in Minnesota.  A "distressed area" means an area certified 
  1.12  by the commissioner of the housing finance agency as meeting the 
  1.13  criteria under section 462C.02, subdivision 9, clause (f), using 
  1.14  the most recently available census data. 
  1.15     Subd. 2.  [FEDERAL LAW APPLICABLE.] For purposes of this 
  1.16  section, the determination of: 
  1.17     (1) applicable percentage is made under section 42(b) of 
  1.18  the Internal Revenue Code; 
  1.19     (2) qualified basis and what is a qualified low-income 
  1.20  building is made under section 42(c) of the Internal Revenue 
  1.21  Code; 
  1.22     (3) eligible basis is made under section 42(d) of the 
  1.23  Internal Revenue Code; 
  1.24     (4) what is a qualified low-income housing project is made 
  1.25  under section 42(g) of the Internal Revenue Code; 
  2.1      (5) recapture of the credit is made under section 42(j) of 
  2.2   the Internal Revenue Code, except that the tax for the taxable 
  2.3   year is increased under section 42(j)(1) of the Internal Revenue 
  2.4   Code, only with respect to credits that were used to reduce 
  2.5   state income taxes; and 
  2.6      (6) application of at-risk rules is made under section 
  2.7   42(k) of the Internal Revenue Code.  As provided in section 42(e)
  2.8   of the Internal Revenue Code, rehabilitation expenditures are 
  2.9   treated as a separate new building and their treatment under 
  2.10  this section are the same as in section 42(e) of the Internal 
  2.11  Revenue Code.  The definitions and special rules relating to the 
  2.12  credit period in sections 42(f) and 42(g) of the Internal 
  2.13  Revenue Code must be applied for the purposes of this section.  
  2.14  Section 469 of the Internal Revenue Code, relating to passive 
  2.15  activity losses and credits, applies in claiming the credit 
  2.16  under this section. 
  2.17     Subd. 3.  [CARRYOVER; ELIGIBILITY.] A tax credit under this 
  2.18  section which exceeds the taxpayer's liability computed under 
  2.19  section 290.06 may be used as a credit against the taxpayer's 
  2.20  liability under section 290.06 in later years until exhausted.  
  2.21  All claims for a tax credit under this section must be filed on 
  2.22  or before the end of the 12th month following the close of the 
  2.23  taxable year for which the credit may be claimed.  Failure to 
  2.24  properly claim the credit waives the right to claim the credit.  
  2.25  In order to claim a credit under this section, a taxpayer must 
  2.26  claim a credit under section 42 of the Internal Revenue Code. 
  2.27     Subd. 4.  [TRANSFER OF CREDITS.] All or any portion of tax 
  2.28  credits granted under this section may be transferred, sold, or 
  2.29  assigned to taxpayers who are eligible for the credit.  Before 
  2.30  an owner or transferee may transfer, sell, or assign a credit 
  2.31  under the section, the owner or transferee must submit to the 
  2.32  commissioner a statement which describes the eligible amount of 
  2.33  credit to be transferred, sold, or assigned.  The owner shall 
  2.34  provide to the commissioner appropriate information so that the 
  2.35  low-income housing tax credit can be properly allocated.  If 
  2.36  recapture of low-income housing tax credits is required under 
  3.1   subdivision 2, clause (5), any statement submitted to the 
  3.2   commissioner as provided in this section must include the 
  3.3   proportion of the state credit required to be recaptured, the 
  3.4   identity of each transferee subject to recapture, and the amount 
  3.5   of credit previously transferred to the transferee. 
  3.6      [EFFECTIVE DATE.] Section 1 is effective for taxable years 
  3.7   beginning after December 31, 2001.