Purpose of the Bill

This bill aims to introduce a new tax incentive, known as the Minnesota Corporate Headquarters Credit, to encourage corporations to relocate or maintain their headquarters in Minnesota. The objective is to stimulate economic development by attracting large corporations to the state and promoting job creation.

Main Provisions

• Corporate Headquarters Credit: Establishes a tax credit for corporations that relocate their headquarters to Minnesota or expand their existing headquarters in the state.
• Eligibility Criteria:
  • Corporations must have worldwide revenues of at least $250 million in the preceding taxable year.
  • The corporation's headquarters must be located or relocated to Minnesota.
  • A corporation must employ at least 250 eligible employees at the headquarters.
  • A minimum investment of $10 million in eligible expenses related to the corporate headquarters project is required.
  • Corporations must maintain or increase job positions at their headquarters.
• Employee Wage Credit: Corporations can receive a credit amounting to 10% of the eligible wages paid to employees, up to $20,000 per employee.
• Credit Calculation: In the first year, the credit is the lesser of the employee wage credit amount or a maximum credit amount calculated as 60% of eligible expenses. If the maximum credit exceeds the wage credit, the corporation can claim the wage credit annually for up to ten years until the total credit equals the maximum.

Certification and Reporting

• Application for Certification: Corporations must apply for certification or provisional certification through the commissioner, with a decision provided within 30 days.
• Annual Reporting: Certified corporations must report annually to affirm ongoing compliance with eligibility requirements.
• Legislative Report: Starting in 2028, an annual report on tax credits issued under this program must be presented to legislative committees, including details on credit amounts and expenses.

Significant Changes to Existing Law

• Introduction of a new corporate tax credit structure specifically targeting corporations with large-scale relocations or expansions in Minnesota.
• Creation of a compliance reporting mechanism to ensure transparency and efficacy of the tax credits.

Relevant Terms

• Corporate headquarters credit
• Eligible expenses
• Employee wage credit
• Qualified corporation
• Relocation or renovation expenses
• Certification process
• Tax credit limits