Bill > SB0040

This bill, known as the "Employee Ownership, Empowerment, and Expansion Act," introduces a comprehensive set of tax incentives and legal provisions to encourage and support employee-owned businesses in Tennessee. The bill creates a tax credit for businesses converting to three types of employee ownership models: employee stock ownership plans (ESOPs), employee ownership trusts, and worker-owned cooperatives. Specifically, businesses can receive up to 50% of their conversion costs, with a maximum credit of $25,000 for worker-owned cooperatives and employee ownership trusts, and up to $100,000 for ESOPs. The tax credits are available for conversions made between January 1, 2026, and January 1, 2031. The bill also modifies existing state law to recognize "Tennessee employee-owned businesses" as a distinct category, which are defined as businesses at least 51% owned by an ESOP, employee ownership trust, or worker-owned cooperative. Additionally, the legislation exempts these types of businesses from certain tax provisions and requires the state department to conduct outreach to minority-owned businesses about the new tax incentives. The bill mandates that the state create a report with metrics to measure the effectiveness of these employee ownership initiatives, ensuring transparency and accountability in implementing the new program.

Business and Industry

https://wapp.capitol.tn.gov/apps/Billinfo/default.aspx?BillNumber=SB0040&ga=114