UNAPPROVED DRAFT BILL -- Subject to Change Without Notice!
BILL NO.
INTRODUCED BY
(Primary Sponsor)BY REQUEST OF THE STATE AUDITOR
A BILL FOR AN ACT ENTITLED: "AN ACT ALLOWING A 3-YEAR TAX CREDIT FOR CERTAIN SMALL EMPLOYERS WHO MAKE A HEALTH BENEFIT PLAN AVAILABLE TO THEIR EMPLOYEES; BASING THE CREDIT ON PREMIUM PAYMENTS PAID BY THE EMPLOYER FOR THE BENEFIT OF EMPLOYEES; PROVIDING LIMITATIONS TO THE CREDIT; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE AND A RETROACTIVE APPLICABILITY DATE."
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
NEW SECTION. Section 1. Credit for contributions to employee health benefit plans for certain employers. (1) An individual, partnership, small business corporation, as defined in l5-31-201, or a limited liability company, as defined in 35-8-102, is allowed a tax credit for a period of 3 years against taxes imposed by l5-30-103 or l5-31-101 for the amount of premiums for a health benefit plan issued pursuant to Title 33, chapter 22, part 18, paid by the taxpayer for the benefit of the taxpayer's employees subject to the conditions of subsections (2) and (3).
(2) The credit is available only to employers who:
(a) have not provided employee health care benefits for the 2 tax years immediately preceding the first tax year in which the credit is claimed; and
(b) employ at least two but not more than nine eligible employees. For the purposes of this subsection (2)(b), "eligible employee" has the same meaning as provided in 33-22-1803.
(3) An employer is entitled to a tax credit for a maximum of nine eligible employees, computed as follows:
(a) the credit in the first tax year is an amount equal to 50% of premium payments not in excess of $200 paid for the benefit of each employee in each month of the tax year;
(b) the credit in the second tax year is an amount equal to 35% of premium payments not in excess of $200 paid for the benefit of each employee in each month of the tax year; and
(c) the credit in the third year is an amount equal to 25% of premium payments not in excess of $200 paid for the benefit of each employee for each month of the tax year.
(4) A credit may not be claimed in the fourth and subsequent tax years.
(5) There is no carryback or carryforward of the credit permitted under this section, and the credit must be applied in the year in which the health benefit plan payments were made, as determined by the taxpayer's accounting method and may not be refunded if the employer has no tax liability.
NEW SECTION. Section 2. Small business corporation, partnership, and limited liability company credit for employee health care benefits. If health benefit plan payments paid for the benefit of employees are claimed as a credit under [section 1] by a small business corporation, as defined in l5-31-201, a partnership, or a limited liability company, as defined in 35-8-102, the credit must be attributed to shareholders, partners, or members or managers of a limited liability company in the same proportion used to report the corporation's, partnership's, or limited liability company's income or loss for Montana income tax purposes.
NEW SECTION. Section 3. Codification instruction. (1) [Section 1] is intended to be codified as an integral part of Title 15, chapter 30, part 1, and the provisions of Title 15, chapter 30, part 1, apply to [section 1].
(2) [Section 2] is intended to be codified as an integral part of Title 15, chapter 31, part 1, and the provisions of Title 15, chapter 31, part 1, apply to [section 2].
NEW SECTION. Section 4. Effective date -- retroactive applicability. [This act] is effective on passage and approval and applies retroactively, within the meaning of 1-2-109, to tax years beginning after December 31, 1998.
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Latest Version of LC 358 (LC0358.01)
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New language in a bill appears underlined, deleted material appears stricken.
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Status of this Bill
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