1.1 	A bill for an act
1.2 	relating to taxation; allowing a credit for certain dentistry material purchases;
1.3 	proposing coding for new law in Minnesota Statutes, chapter 290.
1.4 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.5 	Section 1. [290.0685] CREDIT; DENTAL RESTORATIVE MATERIALS.
1.6 		Subdivision 1.Credit allowed. (a) A credit is allowed against the tax imposed 
1.7 	under this chapter, including the taxes imposed under sections 290.091 and 290.0921, 
1.8 	equal to 25 percent of the amount paid or incurred during the taxable year for qualifying 
1.9 	dentistry materials. 
1.10 	(b) "Qualifying dentistry materials" means synthetic resins or other materials and 
1.11 	supplies used to make composites for use as an alternative to dental amalgam to fill 
1.12 	cavities in or restore human teeth. Qualifying dentistry materials do not include machinery 
1.13 	and equipment used to make or apply the composites.
1.14 		Subd. 2.Limitations; carryover. (a) The credit in subdivision 1 is limited to the 
1.15 	sum of the liability for tax under sections 290.06, 290.091, and 290.0921 for the taxable 
1.16 	year, reduced by the sum of any other nonrefundable credits allowed under those sections.
1.17 	(b) If a corporation is a partner in a partnership, the credit allowed for the taxable 
1.18 	year is limited to the lesser of:
1.19 	(1) the amount determined under paragraph (a) for the taxable year; or
1.20 	(2) an amount, separately computed with respect to the corporation's interest in 
1.21 	the trade or business or entity, equal to the amount of tax attributable to the portion of 
1.22 	taxable income that is allocable or apportionable to the corporation's interest in the trade 
1.23 	or business or entity.
2.1 	(c) If the amount of the credit under this section for any taxable year exceeds 
2.2 	the limitation under paragraphs (a) and (b), the excess is a carryover to each of the 15 
2.3 	succeeding taxable years.  The entire amount of the excess unused credit for the taxable 
2.4 	year must be carried first to the earliest of the taxable years to which the credit may be 
2.5 	carried and then to each successive year to which the credit may be carried.  The amount 
2.6 	of the unused credit which may be added under this paragraph must not exceed the 
2.7 	taxpayer's liability for tax less the credit for the taxable year.
2.8 	(d) A partnership must allocate the credit based on the income shares of its partners.

2.9 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
2.10 	December 31, 2005, and applies to purchases made after June 30, 2006.