HF 1611

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to taxation; providing a tax credit for
qualifying affordable housing contributions; proposing
coding for new law in Minnesota Statutes, chapter 290.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [290.0661] CREDIT FOR AFFORDABLE HOUSING
CONTRIBUTIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Credit allowed. new text end

new text begin Subject to the
limitations and conditions in this section, a taxpayer is
allowed a credit equal to 50 percent of the amount certified to
the commissioner of revenue by the commissioner of the agency as
qualifying affordable housing contributions made by the taxpayer
during the taxable year. The credit applies to the liability
for tax, less nonrefundable credits, imposed by:
new text end

new text begin (1) sections 290.06, subdivision 1, and 290.0921 for
corporations; and
new text end

new text begin (2) sections 290.06, subdivision 2c, and 290.091 for
individuals.
new text end

new text begin Subd. 2. new text end

new text begin Definitions. new text end

new text begin (a) For purposes of this section,
the following terms have the meanings given.
new text end

new text begin (b) "Agency" means the Minnesota Housing Finance Agency.
new text end

new text begin (c) "Qualifying affordable housing contribution" means a
donation made during the taxable year for qualifying housing of:
new text end

new text begin (1) cash; or
new text end

new text begin (2)(i) the fair market value of land and improvements; (ii)
marketable securities; or (iii) construction materials and
supplies to be used for qualifying housing, if the aggregate
amount or value donated by the taxpayer equals at least $1,000.
Fair market value of land and improvements must be determined by
a "qualified appraisal" prepared by a "qualified appraiser" as
those terms are defined in Code of Federal Regulations, title
26, section 1.170A-13.
new text end

new text begin (d) "Qualifying housing" means housing located in the state
of Minnesota, affordable to households with income equal to or
less than the greater of 80 percent of area or statewide median
income as established for the area or state by the United States
Department of Housing and Urban Development, the development or
improvement of which is financed in whole or in part by the
agency or allocated tax credits by the agency.
new text end

new text begin Subd. 3. new text end

new text begin Credit allocation. new text end

new text begin A taxpayer must apply each
year to the commissioner of the agency for an allocation of
qualifying affordable housing contribution tax credits. A
credit need not be allocated for all of a taxpayer's qualifying
contributions. The commissioner of the agency shall notify the
commissioner regarding the identity of each taxpayer that has
been allocated tax credits for the following calendar year by
September 1 of each year.
new text end

new text begin Subd. 4. new text end

new text begin Limitations; carryover. new text end

new text begin (a) The credit allowed
to any taxpayer under this section may not exceed $250,000 for
any taxable year.
new text end

new text begin (b) The credit for the taxable year may not exceed the
liability for tax, as defined in subdivision 1, for the taxable
year.
new text end

new text begin (c) If the amount of the credit determined under this
section for any taxable year exceeds the limitation under
paragraph (b), the excess is a credit carryover to each of the
five succeeding taxable years. The entire amount of the excess
unused credit for the taxable year must be carried to the
earliest of the taxable years to which the credit may be carried
and then to each successive year to which the credit may be
carried. The amount of the unused credit, which may be added
under this paragraph, may not exceed the taxpayer's liability
for tax less any additional credit under this section for the
current taxable year.
new text end

new text begin (d) The total credit allocation allowed for all taxpayers
is limited to a total $....... allocated amount for all taxable
years as follows:
new text end

new text begin (1) $....... for the taxable year beginning during calendar
year 2005;
new text end

new text begin (2) $....... for the taxable year beginning during calendar
year 2006; and
new text end

new text begin (3) $....... for the taxable year beginning during calendar
year 2007.
new text end

new text begin Unallocated credits carry over from one year to the next.
new text end

new text begin Subd. 5. new text end

new text begin Report. new text end

new text begin The commissioner of the agency shall
report to the chairs of the committees of the legislature with
jurisdiction over taxes and housing policy by February 1, 2008,
on the effectiveness of the credit under this section. The
report must include, at least, the estimated number of
affordable housing units constructed or rehabilitated as a
result of credit.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable
years beginning after December 31, 2004, and before January 1,
2010.
new text end