HF 10

as introduced - 89th Legislature (2015 - 2016) Posted on 02/13/2015 10:02am

A bill for an act
relating to taxation; providing a veterans jobs tax credit; 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 [290.0693] VETERANS JOBS TAX CREDIT.
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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.
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new text begin (b)(1) "Qualified employee" means an employee as defined in section 290.92,
subdivision 1, who meets the following criteria:
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new text begin (i) the employee is a resident of Minnesota on the date of hire;
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new text begin (ii) the employee is paid wages as defined in section 290.92, subdivision 1; and
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new text begin (iii) the employee's wages are attributable to Minnesota under section 290.191,
subdivision 12;
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new text begin (2) "Qualified employee" does not include:
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new text begin (i) any employee who bears any of the relationships to the employer described in
subparagraphs (A) to (G) of section 152(d)(2) of the Internal Revenue Code;
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new text begin (ii) if the employer is a corporation, an employee who owns, directly or indirectly,
more than 50 percent in value of the outstanding stock of the corporation, or if the
employer is an entity other than a corporation, an employee who owns, directly or
indirectly, more than 50 percent of the capital and profits interests in the entity, as
determined with the application of section 267(c) of the Internal Revenue Code; or
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new text begin (iii) if the employer is an estate or trust, any employee who is a fiduciary of the estate
or trust, or is an individual who bears any of the relationships described in subparagraphs
(A) to (G) of section 152(d)(2) of the Internal Revenue Code to a grantor, beneficiary,
or fiduciary of the estate or trust.
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new text begin (c) "Qualified employer" means an employer that hired a disabled veteran, an
unemployed veteran, or a veteran as a qualified employee.
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new text begin (d) "Disabled veteran" is a veteran who has a service-connected disability rating as
adjudicated by the United States Veterans Administration, or by the retirement board of
one of the several branches of the armed forces.
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new text begin (e) "Unemployed veteran" is a veteran who:
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new text begin (1) received unemployment compensation under state or federal law at any time
during the two-year period prior to the date of hire; and
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new text begin (2) was unemployed on the date of hire.
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new text begin (f) "Veteran" has the meaning given in section 197.447.
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new text begin (g) "Date of hire" means the day that the qualified employee begins performing
services as an employee of the qualified employer.
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new text begin Subd. 2. new text end

new text begin Credit allowed. new text end

new text begin (a) A qualified employer is allowed a credit for each
of the following individuals that the qualified employer hires as a qualified employee
during the taxable year:
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new text begin (1) a disabled veteran;
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new text begin (2) an unemployed veteran; or
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new text begin (3) a veteran.
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new text begin (b) Subject to the requirements of this section, there is no limit to the number of
credits that a qualified employer may claim under this section during a taxable year.
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new text begin Subd. 3. new text end

new text begin Credit amount for hiring certain veterans. new text end

new text begin (a) A qualified employer who
is required to file a return under section 289A.08, subdivision 1, 2, or 3, is allowed a credit
against the tax imposed by this chapter as determined under this subdivision.
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new text begin (b) For hiring a disabled veteran as a qualified employee, the credit equals ten
percent of the wages paid to the qualified employee during the taxable year, but the
amount of the credit shall not exceed $3,000.
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new text begin (c) For hiring an unemployed veteran as a qualified employee, the credit equals
ten percent of the wages paid to the qualified employee during the taxable year, but the
amount of the credit shall not exceed $1,500.
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new text begin (d) For hiring a veteran as a qualified employee, the credit equals ten percent
of the wages paid to the qualified employee during the taxable year, but the amount of
the credit shall not exceed $500.
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new text begin (e) The credit is limited to the liability for tax under this chapter for the taxable year.
If the credit for a taxable year exceeds the liability for tax under this chapter, the excess
may not be carried over to a subsequent taxable year.
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new text begin (f) A qualified employer may claim the credit available under paragraph (b), (c), or
(d) either for the taxable year in which the qualified employee is hired or for the taxable
year immediately following the year in which the qualified employee was hired, but the
qualified employer may not claim the credit for both taxable years.
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new text begin (g) A qualified employer is allowed only one of the credits authorized under
paragraphs (b) to (d) upon hiring a disabled veteran, an unemployed veteran, or a veteran
as a qualified employee.
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new text begin (h) A qualified employer may not claim a credit under this subdivision for hiring a
disabled veteran, an unemployed veteran, or a veteran as a qualified employee if the
qualified employer currently employs or has previously employed the disabled veteran,
unemployed veteran, or veteran.
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new text begin Subd. 4. new text end

new text begin Flow-through entities. new text end

new text begin Credits granted to a partnership, limited liability
company taxed as a partnership, S corporation, or multiple owners of a business 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, as of the last day of the taxable year.
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new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2014.
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