Senate Bill No. 730

(By Senators Ross, Helmick, Anderson and McKenzie)

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[Introduced February 23, 1998; referred to the Committee on Small Business; and then to the Committee on Finance.]
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A BILL to amend chapter eleven of the code of West Virginia, one thousand nine hundred thirty-one, as amended, by adding thereto a new article, designated article thirteen-n, relating to taxation; and providing a small business tax credit equal to any guaranty fee paid to the small business administration to obtain small business administration financing.

Be it enacted by the Legislature of West Virginia:
That chapter eleven of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended by adding thereto a new article, designated article thirteen-n, to read as follows:
ARTICLE 13N. SMALL BUSINESS TAX CREDIT.

§11-13N-1. Short title.

This article may be cited as the "West Virginia Small Business Tax Credit Act."
§11-13N-2. Small business tax credit.

For the purposes of this article, a "small business" is any corporation, partnership, sole proprietorship or other business entity which has an annual payroll on one million five thousand dollars or less, or annual gross sales on not more than five million dollars. Beginning the first day of January, one thousand nine hundred ninety-nine, and each January thereafter, the tax commissioner shall prescribe amounts which shall apply, in place of the amounts stated in this section, during that calendar year. These amounts shall be prescribed by increasing the amount of each by the cost-of-living adjustment for that calendar year.
Each small business formed under the laws of the state of West Virginia and operating within the state is entitled to claim as a credit against the tax imposed by this chapter for businesses any amount paid to the United Sates small business administration (SBA) as a guaranty fee pursuant to the obtaining of SBA guaranteed financing. This credit shall be applicable only to the tax year in which the guaranty fee was paid. The credit may not reduce the tax below the minimum tax where a minimum tax is provided under this chapter and may only be claimed by the small business which is the primary obligor in the financing transaction and which actually paid the guaranty fee.


NOTE: The purpose of this bill is to give small businesses a tax credit equal to any guaranty fee they pay to the Small Business Administration in order to obtain SBA financing.

Article 13N is new; therefore, strike-throughs and underscoring have been omitted.