SF 1327

as introduced - 86th Legislature (2009 - 2010) Posted on 02/09/2010 02:19am

A bill for an act
relating to taxation; creating a teleworking credit; providing a sales tax
exemption for telework expenses; amending Minnesota Statutes 2008, 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 [290.0692] 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, which expenses are not
otherwise the subject of a subtraction from income claimed by the employer in any tax
year. Eligible expenses:
new text end

new text begin (1) shall include, but not be 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) shall 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 is claimed under any other provision of this chapter;
new text end

new text begin (3) may be incurred only once per employee; and
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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 upon whom an income tax is imposed by
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, 2009. Participating employee
shall 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, 2009, that defines the terms of a telework
arrangement, including the number of days per year the participating employee will
telework, as provided in subdivision 2 in order to qualify for the credit, 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 shall be allowed a tax credit against the tax
imposed by this chapter for a percentage of eligible telework expenses incurred. The
amount of the credit shall be calculated as follows:
new text end

new text begin (1) the credit shall be equal to 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) the credit shall be equal to 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
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new text begin (3) the credit shall be equal to 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, 2009,
shall be 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 costs
shall not be eligible for the credit if they are otherwise the subject of a subtraction from
income claimed by the employer in any tax year. 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 shall not
include expenses for which a credit is claimed under any other provision of this chapter.
The credit shall be 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 In no event shall the total amount of any tax credit under
this section for a taxable year exceed the employer's income tax liability. 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 tax credit provided for
under subdivisions 2 and 3 must submit an application to the commissioner for tentative
approval of the tax credit provided for in subdivisions 2 and 3 between September 1
and October 31 of the year preceding the calendar year for which the tax 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 shall 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, defined in
subdivision 1, but for the availability of the tax credit. The commissioner shall review the
application and shall tentatively approve the application upon determining that it meets
the requirements of this section.
new text end

new text begin (b)(1) The commissioner shall provide tentative approval of the applications by the
date provided in paragraph (c).
new text end

new text begin (2) The total amount of both the tax credits approved by the commissioner under
this section and the exemption under section 297A.67, subdivision 33, shall not exceed
$....... in any calendar year.
new text end

new text begin (c) The commissioner shall notify each employer of the tax credits tentatively
approved and allocated to the employer by December 31 of the year in which the
application was submitted. Once the tax credit application has been approved and the
amount approved has been communicated to the applicant, the employer may make
purchases approved for the tax credit at any time during the calendar year following the
approval of the application. The employer may then apply the amount of the approved
tax credit to its tax 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, 2009.
new text end

Sec. 2.

Minnesota Statutes 2008, 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 290.0692,
subdivision 1, paragraph (b), clause (1), are exempt. The exemption for telework expenses
must not exceed the limitations set forth in section 290.0692, subdivision 5, paragraph
(b), clause (2).
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, 2009.
new text end