SF 68

as introduced - 92nd Legislature (2021 - 2022) Posted on 03/26/2021 09:16am

A bill for an act
relating to taxation; income and corporate franchise; providing a credit for certain
businesses required to operate at reduced capacity.

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

Section 1. new text begin TEMPORARY TAX CREDIT FOR BUSINESSES REQUIRED TO CLOSE
OR OPERATE AT REDUCED CAPACITY.
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 them.
new text end

new text begin (b) "Average annual reduced capacity" means a taxpayer's average monthly reduced
capacity, multiplied by the taxpayer's executive order impact quotient.
new text end

new text begin (c) "Average monthly reduced capacity" means the sum of a taxpayer's lowest level of
reduced capacity effective during each month operating at reduced capacity, expressed as
a percent reduction from 100 percent, divided by total number of months the taxpayer is
subject to an executive order that requires the taxpayer to operate at reduced capacity.
new text end

new text begin (d) "Executive order" means any statement issued pursuant to Minnesota Statutes, section
12.21 or 12.31.
new text end

new text begin (e) "Executive order impact quotient" means the total number of whole or partial months
during the year, rounded up and expressed as a whole number, that a taxpayer is subject to
an executive order that requires the taxpayer to operate at reduced capacity, divided by 12.
new text end

new text begin (f) "Qualifying taxpayer" means a taxpayer whose business:
new text end

new text begin (1) is a place of public accommodation that was closed to ingress, egress, use, and
occupancy by members of the public by Executive Order No. 20-04, as extended, amended,
and otherwise modified by any related executive order; and
new text end

new text begin (2) is a place of public accommodation that was subject to the requirements and
limitations, including operating at reduced capacity, by Executive Order No. 20-74, as
extended, amended, and otherwise modified by any related executive order.
new text end

new text begin (g) "Reduced capacity" means a limitation of occupancy required by executive order
not to exceed some percent of the normal occupant capacity as determined by the fire
marshal, including complete closure, or a maximum number of people allowed in a single
self-contained space.
new text end

new text begin Subd. 2. new text end

new text begin Credit allowed. new text end

new text begin (a) A qualifying taxpayer is allowed a credit, as calculated
under paragraph (b), against the tax imposed under Minnesota Statutes, chapter 290. The
credit must be claimed in a manner prescribed by the commissioner of revenue.
new text end

new text begin (b) A taxpayer's credit equals the taxpayer's tax liability, calculated without regard to
this section, multiplied by the taxpayer's annual average reduced capacity.
new text end

new text begin (c) Taxpayers claiming the credit under this section must certify to the commissioner
of revenue the taxpayer's average annual reduced capacity, average monthly reduced capacity,
and executive order impact quotient.
new text end

new text begin Subd. 3. new text end

new text begin Partnerships; multiple owners. new text end

new text begin Credits granted to a partnership, a limited
liability company taxed as a partnership, S corporation, or multiple owners of property 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 assets or
as specially allocated in their organizational documents or any other executed agreement,
as of the last day of the taxable year.
new text end

new text begin Subd. 4. new text end

new text begin Limitation. new text end

new text begin The credit must not exceed the taxpayer's liability for tax. If the
amount of the credit allowed exceeds the taxpayer's liability for tax, the excess amount is
canceled and is not allowed as a credit carryover.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively for taxable years beginning
after December 31, 2019, and before January 1, 2022.
new text end