Bill > SB21

Introduced Session

This bill creates tax incentives related to businesses in this state converting to an employee ownership business structure and requires the Department of Revenue to establish an outreach and education program to promote employee ownership business structures. Employee ownership conversion costs tax credit Under the bill, DOR may certify a business to claim a nonrefundable income tax credit for an amount equal to 70 percent of costs related to converting the business to a worker-owned cooperative or 50 percent of the costs related to LRB-1413/1 KP:cdc&skw 2025 - 2026 Legislature SENATE BILL 21 converting the business to an employee stock ownership plan. The credit is limited to a maximum amount of $100,000. A business is qualified to receive the credit if the business is subject to income and franchise taxes in this state and, at the time the business receives the credit, does not have an employee stock ownership plan and is not, in whole or in part, a worker-owned cooperative. Capital gain deduction The bill also creates an individual income tax subtraction and a corporate income and franchise tax deduction for the amount of the capital gain realized from the transfer of ownership of a business in this state to an employee stock ownership plan or worker-owned cooperative. Employee ownership outreach and education Finally, the bill directs DOR to establish an economic development program for the purpose of promoting employee ownership business structures, including the business structures of employee stock ownership plans and worker-owned cooperatives, through education, outreach, technical assistance, and training related to converting existing businesses to an employee ownership business structure or starting new businesses with an employee ownership business structure. The bill directs DOR to submit an application to the U.S. secretary of labor for a grant under 29 USC 3228 for use in administering the program created in the bill. Because this bill relates to an exemption from state or local taxes, it may be referred to the Joint Survey Committee on Tax Exemptions for a report to be printed as an appendix to the bill. For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

Committee Categories

Jesse James (R)*,  Chris Larson (D)*,  Cory Tomczyk (R)*,  Clint Anderson (D),  Ryan Clancy (D),  Angelina Cruz (D),  Ben DeSmidt (D),  Benjamin Franklin (R),  Joy Goeben (R),  Russell Goodwin (D),  Rick Gundrum (R),  Francesca Hong (D),  Andrew Hysell (D),  Dean Kaufert (R),  Rob Kreibich (R),  Darrin Madison (D),  Dave Maxey (R),  Vincent Miresse (D),  Todd Novak (R),  Jim Piwowarczyk (R),  Pricilla Prado (D),  Shae Sortwell (R),  Angela Stroud (D),  Ron Tusler (R),  Randy Udell (D),  Chuck Wichgers (R), 

Senate Amendment 1 to Senate Substitute Amendment 1 offered by Senator James (on 06/27/2025)

Official Document