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Minnesota Legislature

Office of the Revisor of Statutes

HF 1141

as introduced - 87th Legislature (2011 - 2012) Posted on 03/27/2012 12:45pm

KEY: stricken = removed, old language.
underscored = added, new language.
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A bill for an act
relating to taxation; creating a teleworking credit; providing a sales tax
exemption for telework expenses;amending Minnesota Statutes 2010, section
297A.67, by adding a subdivision; 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 [290.0693] TELEWORKING CREDIT.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) The terms in this section have the meanings given
them.
new text end

new text begin (b) "Eligible telework expenses" means expenses incurred during the calendar year
pursuant to a telework agreement, up to a limit of $1,200 for each participating employee,
to enable a participating employee to begin to telework. Eligible expenses:
new text end

new text begin (1) include, but are not limited to, expenses paid or incurred to purchase computers;
computer-related hardware and software; modems; data processing equipment;
telecommunications equipment; high-speed Internet connectivity equipment; computer
security software and devices; and all related delivery, installation, and maintenance fees;
new text end

new text begin (2) do not include:
new text end

new text begin (i) replacement costs for computers, computer-related hardware and software,
modems, data processing equipment, telecommunications equipment, or computer
security software and devices at the principal place of business when that equipment is
relocated to the telework site; and
new text end

new text begin (ii) expenses for which a credit or subtraction is claimed under any other provision
of this chapter;
new text end

new text begin (3) may be incurred only once per employee; and
new text end

new text begin (4) may be incurred directly by the employer on behalf of the participating employee
or directly by the participating employee and subsequently reimbursed by the employer.
new text end

new text begin (c) "Employer" means any employer subject to tax under this chapter.
new text end

new text begin (d) "Participating employee" means an employee who has entered into a telework
agreement with the employee's employer on or after July 1, 2011. Participating employee
does not include an individual who is self-employed or an individual who ordinarily
spends a majority of the workday at a location other than the employer's principal place of
business.
new text end

new text begin (e) "Telework" means to perform normal and regular work functions on a workday
that ordinarily would be performed at the employer's principal place of business at a
different location, thereby eliminating or substantially reducing the physical commute
to and from that employer's principal place of business. Telework shall not include
home-based businesses, extensions of the workday, or work performed on a weekend
or holiday.
new text end

new text begin (f) "Telework agreement" means an agreement signed by the employer and the
participating employee, on or after July 1, 2011, that defines the terms of a telework
arrangement, including the number of days per year the participating employee will
telework in order to qualify for the credit as provided in subdivision 2, and any restrictions
on the place from which the participating employee will telework.
new text end

new text begin (g) "Telework assessment" means an optional assessment leading to the development
of policies and procedures necessary to implement a formal telework program that would
qualify the employer for the credit provided in subdivision 2, including but not limited
to a workforce profile; a telework program business case and plan; a detailed accounting
of the purpose, goals, and operating procedures of the telework program; methodologies
for measuring telework program activities and success; and a deployment schedule for
increasing telework activity.
new text end

new text begin Subd. 2. new text end

new text begin Credit allowed. new text end

new text begin An employer is allowed a tax credit against the tax
imposed by this chapter for a percentage of eligible telework expenses incurred. The
amount of the credit is calculated as follows:
new text end

new text begin (1) 100 percent of the eligible telework expenses incurred under a telework
agreement requiring the participating employee to telework at least 15 days per month;
new text end

new text begin (2) 75 percent of the eligible telework expenses incurred under a telework agreement
requiring the participating employee to telework at least ten days per month; or
new text end

new text begin (3) 25 percent of the eligible telework expenses incurred under a telework agreement
requiring the participating employee to telework at least five days per month.
new text end

new text begin Subd. 3. new text end

new text begin Telework assessment credit. new text end

new text begin (a) In addition to the credit provided by
subdivision 2, an employer conducting a telework assessment on or after July 1, 2011, is
allowed a credit in the calendar year of implementation of the employer's formal telework
program against the tax imposed by this chapter for 100 percent of the cost of preparing
the assessment, up to a maximum credit of $20,000 per employer. The credit provided
by this subdivision is intended to include program planning expenses, including direct
program development and training costs, raw labor costs, and professional consulting fees.
The credit does not include expenses for which a credit or subtraction is claimed under
any other provision of this chapter. The credit is allowed only once per employer.
new text end

new text begin (b) All telework assessments eligible for a tax credit under this subdivision shall
meet standards for eligibility adopted by the commissioner.
new text end

new text begin Subd. 4. new text end

new text begin Limitations. new text end

new text begin The credit for any taxable year must not exceed the
employer's liability for tax. Any unused tax credit may not be carried forward to apply to
the employer's succeeding years' tax liability. The tax credit may not be used against the
employer's prior years' tax liability.
new text end

new text begin Subd. 5. new text end

new text begin Application. new text end

new text begin (a) An employer seeking to claim a credit provided for
under subdivisions 2 and 3 must submit an application to the commissioner for tentative
approval of the credit between September 1 and October 31 of the year preceding the
calendar year for which the credit is to be earned. The commissioner shall adopt the
rules and forms on which the application is to be submitted. Amounts specified on the
application must not be changed by the employer after the application is approved by the
commissioner. Applications must certify that the employer would not have incurred the
eligible telework expenses but for the availability of the credit. The commissioner shall
review the application and tentatively approve the application upon determining that
it meets the requirements of this section.
new text end

new text begin (b) The total amount of both credits approved by the commissioner under this section
must not exceed $....... in any calendar year.
new text end

new text begin (c) The commissioner shall notify each employer of the credits tentatively approved
and allocated to the employer by December 31 of the year in which the application
was submitted. Once the credit application is approved and the amount approved is
communicated to the applicant, the employer may make purchases approved for the credit
at any time during the calendar year following the approval of the application. The
employer may then apply the amount of the approved credit to its liability for the tax
year or years for which the approved application applies. If the employer has a tax year
other than a calendar year and the calendar year expenses are incurred in more than one
taxable year, the credit shall be applied to each taxable year based on when the expenses
were incurred.
new text end

new text begin Subd. 6. new text end

new text begin Public report. new text end

new text begin The commissioner shall make available a public report
disclosing the employer names claiming the credit under this section and the amounts
of the credits.
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, 2011.
new text end

Sec. 2.

Minnesota Statutes 2010, section 297A.67, is amended by adding a subdivision
to read:


new text begin Subd. 33. new text end

new text begin Telework expenses. new text end

new text begin Telework expenses, as defined in section 290.0693,
subdivision 1, paragraph (b), clause (1), are exempt.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for sales and purchases made after
June 30, 2011.
new text end