SF 185

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to taxation; providing an income and corporate franchise tax credit for
qualifying investment in dairy and livestock operations; amending Minnesota
Statutes 2006, section 290.06, by adding a subdivision.

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

Section 1.

Minnesota Statutes 2006, section 290.06, is amended by adding a
subdivision to read:

new text begin Subd. 34. new text end

new text begin Dairy and livestock investment credit. new text end

new text begin (a) A dairy and livestock
investment credit is allowed against the tax due under this chapter equal to ten percent
of the amount paid or incurred by the taxpayer, on the first $500,000 of qualifying
expenditures made in the qualifying period by a person who raises dairy animals or
livestock in this state.
new text end

new text begin (b) For purposes of this subdivision, "qualifying expenditures" means qualifying
dairy expenditures plus qualifying livestock expenditures.
new text end

new text begin (c) For purposes of this subdivision, "qualifying dairy expenditures" means the
amount spent for:
new text end

new text begin (1) the acquisition, construction, or improvement of buildings or facilities, if related
to dairy animals;
new text end

new text begin (2) the development of pasture owned or rented by the taxpayer for the use of dairy
animals; or
new text end

new text begin (3) the acquisition of equipment for dairy animal housing, for confinement, for
animal feeding, for production and delivery of milk and other dairy products, and for
waste management, including the following, if related to dairy animals in this state:
new text end

new text begin (i) freestall barns;
new text end

new text begin (ii) fences;
new text end

new text begin (iii) watering facilities;
new text end

new text begin (iv) feed storage and handling equipment;
new text end

new text begin (v) milking parlors;
new text end

new text begin (vi) robotic equipment;
new text end

new text begin (vii) scales;
new text end

new text begin (viii) milk storage and cooling facilities;
new text end

new text begin (ix) bulk tanks;
new text end

new text begin (x) manure pumping and storage facilities;
new text end

new text begin (xi) digesters;
new text end

new text begin (xii) equipment used to produce energy; and
new text end

new text begin (xiii) on-farm processing and refrigerated trucks for delivery of milk and other
dairy products.
new text end

new text begin (d) For purposes of this subdivision, "livestock" has the meaning given in section
17A.03, subdivision 5, but also includes fish that are raised in aquaculture facilities and
poultry, and "qualifying livestock expenditures" means the amount spent for:
new text end

new text begin (1) the acquisition, construction, or improvement of buildings or facilities, if related
to livestock;
new text end

new text begin (2) the development of pasture owned or rented by the taxpayer for the use of
livestock; or
new text end

new text begin (3) the acquisition of equipment for livestock housing, confinement, animal feeding,
production and delivery of livestock products, and waste management, including the
following, if related to livestock in this state:
new text end

new text begin (i) birthing, rearing, and feedlot structures;
new text end

new text begin (ii) feed storage and handling equipment;
new text end

new text begin (iii) fences;
new text end

new text begin (iv) watering facilities;
new text end

new text begin (v) scales;
new text end

new text begin (vi) manure pumping and storage facilities;
new text end

new text begin (vii) digesters;
new text end

new text begin (viii) equipment used to produce energy;
new text end

new text begin (ix) fish hatchery buildings;
new text end

new text begin (x) fish processing buildings;
new text end

new text begin (xi) fish rearing ponds.
new text end

new text begin (e) Qualifying expenditures, other than expenditures for development of pasture,
only include amounts that are capitalized and deducted under either section 167 or 179 of
the Internal Revenue Code in computing federal taxable income. Qualifying expenditures
for development of pasture must not include land acquisition and are limited to soil
preparation expenses, seed costs, planting costs, and weed control, which are allowed once
for each acre owned or rented by the taxpayer for the use of dairy animals or livestock
and developed into pasture during the qualifying period.
new text end

new text begin (f) The credit is limited to the liability for tax, as computed under this chapter for the
taxable year. If the amount of the credit determined under this section for any taxable year
exceeds this limitation, the excess is a dairy and livestock investment credit carryover to
each of the 15 succeeding taxable years. The entire amount of the excess unused credit for
the taxable year is carried first 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 shall not exceed the taxpayer's
liability for tax less the dairy and livestock investment credit for the taxable year.
new text end

new text begin (g) The qualifying period is that time after December 31, 2006, and before January
1, 2013.
new text end

new text begin (h) The $50,000 maximum credit applies at the entity level for partnerships, S
corporations, trusts, and estates, as well as at the individual level. In the case of married
individuals, the credit is limited to $50,000 for a married couple.
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, 2006.
new text end