1.1.................... moves to amend H.F. No. 318 as follows:
1.2Page 13, after line 32, insert:
1.3 "Sec. 8.
[290.016] FEDERAL CONFORMITY FOR CURRENT TAXABLE
1.4YEAR.
1.5 Subdivision 1. Definitions. (a) For purposes of this section, the following terms
1.6have the meanings given.
1.7(b) "Current taxable year" means taxable years beginning during the calendar year in
1.8which the qualified federal enactment occurred.
1.9(c) "Minnesota corporate franchise tax revenue" means revenue derived from the tax
1.10under section 290.06, subdivision 1, and section 290.0921.
1.11(d) "Minnesota individual income tax revenue" means revenue derived from the tax
1.12under section 290.06, subdivision 2c, and section 290.091.
1.13(e) "Nonqualifying provision" means a federal change to the definition of net income
1.14in section 290.01, subdivision 19, which was in effect in the preceding taxable year,
1.15but which Minnesota did not adopt for the preceding taxable year, but instead required
1.16an addition to federal taxable income, subtraction from federal taxable income, or other
1.17modification.
1.18(f) "Preceding taxable year" means taxable years beginning during the calendar year
1.19preceding that in which the qualified federal enactment occurred.
1.20(g) "Qualified federal enactment" means a federal tax law that:
1.21(1) modifies the definition of net income in section 290.01, subdivision 19, for the
1.22current taxable year; and
1.23(2) was enacted into law after the adjournment of the regular legislative session for
1.24the year or within two calendar weeks before the last day of the calendar year in which the
1.25legislature is permitted by the constitution to meet in regular session.
1.26(h) "Qualified federal tax provision" means a provision of a qualified federal
1.27enactment that the commissioner determines is the same or similar to a provision of
2.1federal law affecting the computation of net income for the preceding taxable year and the
2.2predecessor provision was not a nonqualifying provision.
2.3 Subd. 2. Qualified federal tax provisions effective for current taxable year. (a)
2.4Each year in which there is one or more qualified federal enactments, the commissioner
2.5must estimate the effect of each qualified federal tax provision on Minnesota individual
2.6income tax revenues and Minnesota corporate franchise tax revenues for the current
2.7taxable year.
2.8(b) Notwithstanding the provisions of section 290.01 specifying that the Internal
2.9Revenue Code means the version of the Internal Revenue Code as amended through
2.10a specific date, the Internal Revenue Code for the current taxable year includes each
2.11qualified federal tax provision, if the commissioner estimates that the sum of the effects
2.12of all qualified federal tax provisions on Minnesota individual income tax and corporate
2.13franchise tax revenues will result in an increase or decrease in Minnesota individual income
2.14tax and corporate franchise tax revenues of less than one percent of Minnesota individual
2.15income tax and corporate franchise tax revenues estimated for the current taxable year.
2.16(c) Each qualified federal tax provision that becomes effective under this section for
2.17the current taxable year is effective at the same time it became effective for federal purposes.
2.18 Subd. 3. Federal conformity bracket adjustment; individuals. (a) If the
2.19commissioner determines that the conditions required under subdivision 2, paragraph
2.20(b), are satisfied, the commissioner must adjust the individual income tax brackets to
2.21offset the effect of the qualified federal tax provisions on Minnesota individual income
2.22tax revenues, as provided in paragraph (b).
2.23(b) The commissioner must adjust the individual income tax brackets in section
2.24290.06, subdivision 2c, in a manner such that the aggregate increase or decrease in tax for
2.25each income bracket, other than the first bracket, bears the same relationship to the total
2.26increase or decrease in tax as the current tax assessed on income in each bracket bears
2.27to the total current tax assessed on income in all brackets other than the first bracket.
2.28The commissioner may round the brackets as provided in section 290.06, subdivision
2.292d, paragraph (a).
2.30 Subd. 4. Federal conformity surtax; corporations. (a) If the commissioner
2.31determines that the conditions required under subdivision 2, paragraph (b), are satisfied,
2.32the commissioner must assess a surtax to offset the effect of the qualified federal tax
2.33provisions on corporate franchise tax revenues, as provided in this section. The surtax may
2.34be positive, in the case of a qualified federal provision estimated to result in a decrease in
2.35Minnesota corporate franchise tax revenue, or negative, in the case of a qualified federal tax
2.36provision estimated to result in an increase in Minnesota corporate franchise tax revenue.
3.1(b) The commissioner must assess a surtax on the tax owed under section 290.06,
3.2subdivision 1, at the rate necessary to offset the increase or decrease in Minnesota corporate
3.3franchise tax revenue resulting from the qualified federal tax provision. The commissioner
3.4may round the rate of the surtax to be in an increment of one-tenth of one percent.
3.5 Subd. 5. Reports and draft legislation. (a) Within 30 days of a qualified federal
3.6enactment the commissioner must notify the chairs of the house and senate committees
3.7with jurisdiction over taxes of :
3.8(1) any qualified federal tax provisions included in the qualified federal enactment;
3.9(2) if the qualified federal tax provisions in the qualified federal enactment, in
3.10aggregate with any qualified federal tax provisions from previous qualified federal
3.11enactments, do or do not meet the conditions required under subdivision 2, paragraph (b);
3.12(3) the amount of any bracket adjustment required under subdivision 3; and
3.13(4) the amount and rate of any surtax assessment required under subdivision 4.
3.14(b) By January 15 of the next year the commissioner must provide the chairs of
3.15the house and senate committees with jurisdiction over taxes with draft legislation to
3.16update the statutes for any qualified federal tax provisions, bracket adjustments, and
3.17surtax assessments in the current taxable year.
3.18 Subd. 6. Estimated taxes; exceptions. No addition to tax, penalties, or interest may
3.19be made under Minnesota Statutes, section 289A.25, or under Minnesota Statutes, section
3.20289A.26, for the current taxable year, with respect to an underpayment of estimated tax, to
3.21the extent that the underpayment was created or increased by the changes to the income
3.22brackets or the surtax under this section.
3.23EFFECTIVE DATE.This section is effective the day following final enactment for
3.24qualifying federal enactments occurring in calendar year 2013 and following years."
3.25Renumber the sections in sequence and correct the internal references
3.26Amend the title accordingly