SF 1008

as introduced - 91st Legislature (2019 - 2020) Posted on 02/11/2019 02:38pm

A bill for an act
relating to taxation; income and corporate franchise; allowing simplified
computation of base amount for the research credit; amending Minnesota Statutes
2018, section 290.068, subdivision 2.

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

Section 1.

Minnesota Statutes 2018, section 290.068, subdivision 2, is amended to read:

Subd. 2.

Definitions.

For purposes of this section, the following terms have the meanings
given.

(a) "Qualified research expenses" means (i) qualified research expenses and basic research
payments as defined in section 41(b) and (e) of the Internal Revenue Code, except it does
not include expenses incurred for qualified research or basic research conducted outside
the state of Minnesota pursuant to section 41(d) and (e) of the Internal Revenue Code; and
(ii) contributions to a nonprofit corporation established and operated pursuant to the
provisions of chapter 317A for the purpose of promoting the establishment and expansion
of business in this state, provided the contributions are invested by the nonprofit corporation
for the purpose of providing funds for small, technologically innovative enterprises in
Minnesota during the early stages of their development.

(b) "Qualified research" means qualified research as defined in section 41(d) of the
Internal Revenue Code, except that the term does not include qualified research conducted
outside the state of Minnesota.

(c) "Base amount" means base amount as defined in section 41(c) of the Internal Revenue
Code, except that the average annual gross receipts and aggregate gross receipts must be
calculated using Minnesota sales or receipts under section 290.191 and the definitions
contained in paragraphs (a) and (b) shall apply. new text begin If there are inadequate records or the records
are unavailable to compute or verify the base percentage, a fixed base percentage of 16
percent must be used.
new text end

(d) "Liability for tax" means the sum of the tax imposed under section 290.06,
subdivisions 1 and 2c, for the taxable year reduced by the sum of the nonrefundable credits
allowed under this chapter, on all of the entities required to be included on the combined
report of the unitary business.

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