Senate Panel Considers Expanding Tax Credit for Small Businesses

The Senate Tax Reform Division heard three bills this week to expand the existing research and development tax credit. These bills would make the credit available to sole proprietors and encourage entrepreneurs and start-up businesses in Minnesota. Testifiers praised the set of bills as policies that will continue to encourage innovation and make Minnesota more competitive.

When Minnesota’s R&D credit was first enacted in 1982, it could be applied to the corporate franchise tax and individual income tax, including sole proprietors. In 1987, the state narrowed the application to only allow application against the corporate franchise tax. This bill would expand it again to include sole proprietors, making it accessible to all groups that originally were allowed to utilize the credit when it was first enacted. (S.F. 38/S.F. 305/S.F. 351)

Senate DFL Media