HF 2877

as introduced - 91st Legislature (2019 - 2020) Posted on 05/10/2019 09:51am

A bill for an act
relating to economic development; creating a voluntary small employer paid family
leave insurance program; establishing a tax credit; appropriating money; proposing
coding for new law in Minnesota Statutes, chapters 62L; 290.

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

Section 1.

new text begin [62L.24] VOLUNTARY SMALL EMPLOYER PAID FAMILY LEAVE
INSURANCE PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

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

new text begin (b) "Benefit" means payments made by an employer or employee pursuant to this section
associated with leave that would be covered by FMLA if the employer was subject to FMLA.
new text end

new text begin (c) "Commissioner" means the commissioner of employment and economic development.
new text end

new text begin (d) "FMLA" means the federal Family and Medical Leave Act of 1993, United States
Code, title 29, section 2601, et seq.
new text end

new text begin (e) "Program" means the voluntary small employer paid family leave insurance program
established by this section.
new text end

new text begin (f) "Small employer" has the meaning given in section 62L.02, subdivision 26.
new text end

new text begin Subd. 2. new text end

new text begin Creation; administration. new text end

new text begin (a) A voluntary small employer paid family leave
insurance program is created. The commissioner, in consultation with the commissioner of
commerce, must administer the program under this section.
new text end

new text begin (b) The commissioner must contract with an insurance company licensed under chapter
60A to administer the program.
new text end

new text begin (c) The program must set employer and employee contributions at a rate sufficient to
fund the program, including to pay for benefits and reasonably incurred expenses.
new text end

new text begin (d) The commissioner must determine the appropriate benefits to be paid to each
employee and may allow up to 12 weeks of benefits. If the employee exercises the employee's
rights under FMLA, benefits under this section must be provided concurrently.
new text end

new text begin Subd. 3. new text end

new text begin Contributions. new text end

new text begin A small employer's employees may enroll in the program in
the employee's individual capacity. A small employer may enroll in the program on behalf
of its employees and contribute, in part or wholly, to the voluntary small employer paid
family leave insurance program on behalf of its employees. An employer exempt from
FMLA may elect to participate in the program.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 2.

new text begin [290.0693] SMALL EMPLOYER PAID FAMILY LEAVE CREDIT.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

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

new text begin (b) "Qualifying employer" means an employer with qualifying employee expenses in a
taxable year.
new text end

new text begin (c) "Qualifying employee expenses" means premiums and other payments an employer
pays to participate in the program on behalf of its employees.
new text end

new text begin (d) "Small employer paid family leave insurance program" or "program" means the
voluntary small employer paid family leave insurance program, as provided under section
62L.24.
new text end

new text begin Subd. 2. new text end

new text begin Credit allowed. new text end

new text begin (a) A taxpayer that is a qualified employer may credit against
the tax imposed under this chapter. The credit is 25 percent of the taxpayer's qualifying
employee expenses. The credit must not exceed the liability for tax under this chapter.
new text end

new text begin (b) The credit authorized under this section is limited to $150,000 per qualified employer
per taxable year.
new text end

new text begin Subd. 3. new text end

new text begin Carryover. new text end

new text begin If the credit authorized under this section exceeds the tax imposed
under this chapter, the excess is a credit carryover to each of the five succeeding taxable
years. The entire amount of the excess unused credit must be carried first to the earliest
taxable year the amount may be carried to. The unused portion of the credit must be carried
to the following taxable year. A credit must not be carried to a taxable year that is more
than five years after the taxable year in which the credit was earned.
new text end

new text begin Subd. 4. new text end

new text begin Pass-through entities. new text end

new text begin Credits a partnership, a limited liability company taxed
as a partnership, an S corporation, or multiple owners of property may claim under this
section are passed through to the partners, members, shareholders, or owners, respectively,
pro rata to each partner, member, shareholder, or owner based on their share of the entity's
income for the taxable year.
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, 2018.
new text end

Sec. 3. new text begin VOLUNTARY SMALL EMPLOYER PAID FAMILY LEAVE INSURANCE
PROGRAM; APPROPRIATION.
new text end

new text begin $....... in fiscal year 2020 is appropriated from the general fund to the commissioner of
commerce to fund the voluntary small employer paid family leave insurance program under
section 62L.24.
new text end