Section 1. [Definitions] Adds the definition of “qualified greater Minnesota business” to the definitions in the small business investment credit chapter. The small business investment credit is also known as the “angel investment” credit. The Commissioner of Employment and Economic Development (DEED) must certify that the business qualifies under the requirements in section 2. Effective the day following final enactment.
Section 2. [Certification] Requires that to receive certification as a qualified greater Minnesota business, a business must satisfy the existing requirements for qualified small businesses under current law, have its headquarters in greater Minnesota, have at least 51 of percent of its employees employed in greater Minnesota, and have 51 percent of its total payroll paid or incurred in greater Minnesota. Requires the DEED Commissioner to maintain a list of qualified small businesses and qualified greater Minnesota businesses certified in a calendar year and make the list accessible to the public. Defines “greater Minnesota” as the area outside the seven-county metropolitan area. Effective the day following final enactment.
Section 3. [Credit allowed] Allows a qualified investor a credit of 50 percent of a qualified investment in a greater Minnesota business. Increases the allocation of credits from $12 million to $17 million per taxable year for tax years 2014 and 2015. Effective the day following final enactment for taxable years beginning after December 31, 2012.
Section 4. [Revocation of credits] Applies the repayment provisions for the small business investment credit to greater Minnesota businesses, if the DEED Commissioner determines that a business did not meet the certification requirements under section 2 in any of the five years after the year in which the qualifying investment was made. Effective the day following final enactment.
Section 5. [Report to Legislature] Adds the requirement that the annual report to the Legislature on the qualified small business investment credit include the number of qualified small businesses that are minority or women-owned. Effective the day following final enactment.
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