Bill Text: WV HB2481 | 2018 | Regular Session | Introduced
Bill Title: Creating tax credits for new and/or existing small businesses
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2018-01-10 - To House Small Business, Entrepreneurship and Economic Development [HB2481 Detail]
Download: West_Virginia-2018-HB2481-Introduced.html
FISCAL
NOTE
WEST virginia Legislature
2017 regular session
By
[
to the Committee on Small Business, Entrepreneurship and Economic Development
then Finance.
A BILL to amend the Code
of West Virginia, 1931, as amended, by adding thereto a new article, designated
§11-13DD-1, relating to creating tax credits for new and/or existing small businesses
in this state and operating entirely within West Virginia.
Be it enacted by the
Legislature of West Virginia:
That the Code of West
Virginia, 1931, as amended, be amended by adding thereto a new article,
designated §11-13DD-1, to read as follows:
ARTICLE 13DD. SMALL BUSINESS TAX CREDITS.
§11-13DD-1. Tax credits for small business economic
impact.
(a) Credit allowed. -- In order to assist and encourage the creation
and growth of small business owners in the State of West Virginia, as well as
promoting job growth from within this state by hiring residents of the state,
for those tax years beginning on or after January 1, 2017, through June 2026,
there is allowed a credit, for any taxpayer based in and operating entirely
within this state employing less than one hundred employees, against certain
taxes imposed by this state as described in subsection (c) of this section for
wages paid to newly hired employees who are employed on a full-time basis
(thirty-two hours a week or more) for a period of not less than one year and
who are full-time residents of West Virginia.
Employees may not be terminated after one year of employment, without
cause, in order to be replaced by then newly hired employees in order to gain
additional tax credits under this section.
(b) Amount of credit. -- The tax credit is in an amount equal to $2,500
per each new hired employee during each of the calendar years of 2017 through
June 2026, except the amount of credit allowed for any tax year with respect to
each new employee may not exceed fifty percent of the actual wages paid in the
tax year for the new employee, whichever is less.
(c) Application of annual credit allowance. -- The amount of credit as
determined under subsection (b) of this section is allowed as a credit against
the taxpayer’s state tax liability applied as provided in subdivisions (1)
through (3), inclusive of this subsection, and in that order.
(1) Business franchise tax. --
The credit must first be applied to reduce the taxes imposed by article
twenty-three of this chapter for the taxable year.
(2) Corporation net income taxes. -- After application of subdivision
(1) of this subsection, any unused credit is next applied to reduce the taxes
imposed by article twenty-four of this chapter for the taxable year.
(3) Personal income taxes. --
(A) If the person making
the qualified employment is an electing small business corporation (as defined
in Section 1361 of the United States Internal Revenue Code of 1986, as
amended), a partnership, a limited liability company that is treated as a partnership
for federal income tax purposes, or a sole proprietorship, then any unused
credit (after application of subdivisions (1) and (2) of this subsection) is
allowed as a credit against the taxes imposed by article twenty-one of this
chapter on the income from business or other activity subject to tax under
article twenty-three of this chapter or on income of a sole proprietor
attributable to the business.
(B) Electing small
business corporations, limited liability companies, partnerships and other
unincorporated organizations shall allocate the credit allowed by this article
among its members in the same manner as profits and losses are allocated for
the taxable year.
(4) A credit is not
allowed under this section against any employer withholding taxes imposed by
article twenty-one of this chapter.
(d) Unused credit. -- If any
credit remains after application of subsection (c) of this section, that amount
is forfeited. A carryback to a prior
taxable year is not allowed for the amount of any unused portion of any annual
credit allowance.
NOTE: The purpose of this bill is
to create tax credits for new small businesses in order to assist and encourage
the growth of small business owners in the State of West Virginia, as well as
promoting job growth from within this state by hiring residents of the state,
for those tax years beginning on or after January 1, 2017, through June 2026.
Strike-throughs indicate language
that would be stricken from a heading or the present law and underscoring
indicates new language that would be added.
