SF 10

as introduced - 91st Legislature, 2020 7th Special Session (2020 - 2020) Posted on 12/15/2020 07:50am

A bill for an act
relating to taxation; income; establishing a refundable tax credit for donations of
food.

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

Section 1. new text begin DONATIONS USED TO CLAIM TEMPORARY TAX CREDIT FOR
DONATED FOOD; ADDITION TO INCOME FOR INDIVIDUALS, ESTATES, AND
TRUSTS.
new text end

new text begin The amount of qualifying food donations used to claim the credit under section 3 is an
addition for the purposes of Minnesota Statutes, section 290.0131. The addition is limited
to amounts that were deducted in calculating federal adjusted gross income or federal taxable
income, as applicable.
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, 2019, and before January 1, 2022.
new text end

Sec. 2. new text begin DONATIONS USED TO CLAIM TEMPORARY TAX CREDIT FOR
DONATED FOOD; ADDITION TO INCOME FOR CORPORATIONS.
new text end

new text begin The amount of qualifying food donations used to claim the credit under section 3 is an
addition for the purposes of Minnesota Statutes, section 290.0133. The addition is limited
to amounts that were deducted in calculating federal taxable income.
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, 2019, and before January 1, 2022.
new text end

Sec. 3. new text begin TEMPORARY TAX CREDIT FOR DONATED FOOD.
new text end

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.
new text end

new text begin (b) "Food service business" means a place of public accommodation offering food or
beverages for on-premises consumption.
new text end

new text begin (c) "Qualifying closure" means a period of time during which a food service business
was prohibited from offering in-person dining under an act of the legislature or an emergency
executive order issued as a result of the COVID-19 pandemic, including but not limited to
Emergency Executive Order 20-99.
new text end

new text begin (d) "Qualifying food donation" means a donation of food by a food service business
from its inventory that:
new text end

new text begin (1) qualifies as a charitable contribution under section 170 of the Internal Revenue Code,
disregarding the limits in section 170(b) and 170(e)(3)(C);
new text end

new text begin (2) was made during a qualifying closure, or within seven days of the end of a qualified
business closure; and
new text end

new text begin (3) was made after November 20, 2020, but before July 1, 2021.
new text end

new text begin Subd. 2. new text end

new text begin Credit allowed. new text end

new text begin (a) A credit is allowed against the tax imposed by Minnesota
Statutes, chapter 290, equal to 50 percent of qualifying food donations in the taxable year.
new text end

new text begin (b) The credit is limited to $5,000 per taxable year per food service business.
new text end

new text begin (c) For a business entity that operates multiple food service businesses, the credit is
calculated based on the amount of qualified food donations from each food service business,
and the limit applies separately to each food service business.
new text end

new text begin Subd. 3. new text end

new text begin Determination of donation value. new text end

new text begin The amount of a qualifying food donation
must be determined using the rules in section 170(e) of the Internal Revenue code, including
the special rules for contributions of food inventory under section 170(e)(3)(C).
new text end

new text begin Subd. 4. new text end

new text begin Treatment of credits for pass-through entities. new text end

new text begin Credits allowed to a
partnership, a limited liability company taxed as a partnership, an S corporation, or multiple
owners of property 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 income for the taxable year.
new text end

new text begin Subd. 5. new text end

new text begin Credit refundable. new text end

new text begin (a) If the amount of credit which the taxpayer is eligible
to receive under this section exceeds the taxpayer's tax liability under Minnesota Statutes,
chapter 290, the commissioner shall refund the excess to the claimant.
new text end

new text begin (b) An amount sufficient to pay the refunds required by this section is appropriated to
the commissioner from the general fund.
new text end

new text begin Subd. 6. new text end

new text begin Denial of double benefit. new text end

new text begin A taxpayer who claims the credit allowed under this
section must not deduct a qualifying food donation under Minnesota Statutes, section
290.0122, subdivision 4.
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, 2019, and before January 1, 2022.
new text end