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Revenue Notice #13-02: Corporate Franchise Tax Credit - Job Opportunity Building Zones - Member of a Pass-through Entity

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See also Revenue Notice #11-01

Introduction

This Revenue Notice addresses whether a pass-through entity that is a job opportunity building zone (JOBZ)-qualified business, operating within a JOB zone pursuant to Minnesota Statutes, sections 469.310469.320, may pass through to its members or partners the JOBZ credit provided under Minnesota Statutes, section 469.318. This credit is allowed against the taxes imposed under Minnesota Statutes chapter 290 and is refundable to the extent that the amount of the credit exceeds the JOBZ-qualified business’s liability.

JOBZ tax exemptions claimed by pass-through entities pursuant to Minnesota Statutes, sections 469.316 and 469.317 are treated differently than the credits earned under section 469.318. The treatment of JOBZ tax exemptions claimed by pass-through entities is discussed in Revenue Notice # 11-01.

Department Position

The Department’s position is that a JOBZ-qualified, pass-through entity may either claim the credit or may pass through the credit earned under Minnesota Statutes, section 469.318 to its members or partners. The JOBZ-qualified, pass-through entity may distribute the JOBZ credit, even when those partners or members are not themselves JOBZ-qualified businesses.

Signed by Assistant Commissioner Susan Von Mosch and published in the Minnesota State Register on August 26, 2013.

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