MN SF4394

Qualified employers with 50 or fewer employees in Minnesota may claim a tax credit against income and corporate franchise taxes equal to amounts paid for paid family leave benefits for qualified employees, capped at $3,000 per employee per year.

Qualified employees must have been employed by the qualified employer for one year or more and leave must be for caregiving, child bonding within 12 months of birth or adoption/foster placement, or military family exigencies.

Commissioner must allocate credits on a first-come, first-served basis up to a maximum of $50,000,000 per year, with unallocated amounts rolling over until December 31, 2025, when any remaining allocation is cancelled.

Unused credits may be carried forward to the next five taxable years if the credit exceeds tax liability in the current year; credits pass through to partners, members, and shareholders pro rata.

Credit is effective for taxable years beginning after December 31, 2022, and before January 1, 2026.