AB 3

Under this bill, generally, a business that increases its net employment by at

least 15 full-time employees in any taxable year may begin to receive a tax benefit,

if it applies to the Department of Commerce (Commerce) to receive that benefit.

Under the bill, an eligible business may, rather than submit the amount as

withholding taxes, retain an amount that is equal to the withholding taxes that the

business is required to pay on wages earned by each full-time employee, as certified

by Commerce, in the year for which the business claims the tax benefit, multiplied

by the employee's applicable tax rate. A business may claim the benefit for only five

years, unless the business can demonstrate to Commerce that it needs an additional

five-year extension. Under the bill, the Department of Revenue (DOR) considers all

amounts retained as tax benefits to be amounts submitted to DOR as withholding

taxes.