Bill > SF2720

This bill modifies the research tax credit in Minnesota. It allows a corporation, partnership, or "S" corporation to claim a credit equal to 10% of the first $2 million in qualified research expenses that exceed the base amount, and 4% on all excess expenses over $2 million. Alternatively, a taxpayer can elect to use an alternative simplified credit method, which calculates the base amount as 50% of the average qualified research expenses for the previous three years, and apply a 6% credit rate on all qualified research expenses above this amount. The bill also clarifies the definitions of "qualified research expenses" and "base amount" for the purposes of the credit. These changes are effective for taxable years beginning after December 31, 2018.