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S.F. No. 345 - Corporate AMT repeal (as proposed to be amended by A-1)
 
Author: Senator Ann H. Rest
 
Prepared By: Nora Pollock, Senate Counsel (651/297-8066)
 
Date: March 1, 2019



 

Corporations must calculate their tax under both the regular corporate franchise tax schedule and the corporate alternative minimum tax (AMT), which uses a broader tax base, and pay the higher of the two. This bill eliminates the corporate AMT and repeals provisions that cross reference the corporate AMT, effective beginning in tax year 2019.

Section 1. Certain preferred stock losses. Strikes the reference to corporate AMT income for purposes of calculating capital losses.

Section 2. Carryover credit.  Modifies the carryover credit under the corporate AMT to reflect the repeal of the corporate AMT. The carryover credit allows corporations that pay AMT in one year to use that tax as a credit against regular tax in a later tax year. The bill will continue to allow carryover credits generated in years prior to tax year 2019 to continue to be used in 2019 and later tax years.

Section 3. Corporate franchise tax exemption. Strikes references to the corporate AMT for purposes of the JOBZ corporate AMT exemption.

Section 4. Repealer. Repeals the imposition of the corporate AMT and corresponding provisions. The carryover credit modified in section 2 is retained.

 
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