HF 613

as introduced - 81st Legislature (1999 - 2000) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act
  1.2             relating to taxation; corporate franchise tax; 
  1.3             allowing an election to treat all income as business 
  1.4             income; amending Minnesota Statutes 1998, section 
  1.5             290.17, subdivision 6. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 1998, section 290.17, 
  1.8   subdivision 6, is amended to read: 
  1.9      Subd. 6.  [NONBUSINESS INCOME.] (a) For a trade or business 
  1.10  for which allocation of income within and without this state is 
  1.11  required, if the taxpayer has any income not connected with the 
  1.12  trade or business carried on partly within and partly without 
  1.13  this state that income must be allocated under subdivision 2.  
  1.14  Intangible property is employed in a trade or business if the 
  1.15  owner of the property holds it as a means of furthering the 
  1.16  trade or business. 
  1.17     (b) A taxpayer may elect that all income, whether or not 
  1.18  connected with the trade or business carried on partly within 
  1.19  and partly without this state, is business income apportionable 
  1.20  under subdivision 3 and is not subject to paragraph (a) and 
  1.21  subdivision 2.  The election is effective and irrevocable for 
  1.22  the taxable year of the election and the following nine taxable 
  1.23  years.  The election is binding on all members of a unitary 
  1.24  business. 
  1.25     Sec. 2.  [APPORTIONMENT; PRE-1999 RETURNS.] 
  2.1      If a taxpayer that conducts a trade or business partly 
  2.2   within and partly without this state treats any item of income, 
  2.3   gain or loss, as apportionable under Minnesota Statutes, section 
  2.4   290.17, subdivision 3, on a return filed for a taxable year 
  2.5   beginning before January 1, 1999, the commissioner may not 
  2.6   challenge that treatment. 
  2.7      Sec. 3.  [EFFECTIVE DATE.] 
  2.8      Section 1 is effective for taxable years beginning after 
  2.9   December 31, 1998. 
  2.10     Section 2 is effective on the day following final enactment 
  2.11  and applies to any administrative or judicial challenge pending 
  2.12  on or arising after the effective date.