LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION May 8, 2009 TO: Honorable Rene Oliveira, Chair, House Committee on Ways & Means FROM: John S. O'Brien, Director, Legislative Budget Board IN RE:HB1283 by Eiland (Relating to installment payments of ad valorem taxes on property in a disaster area.), Committee Report 1st House, Substituted No fiscal implication to the State is anticipated. The bill would amend Chapter 31 of the Tax Code, regarding the collection of property taxes. The bill would increase the types of real property damaged in a disaster for which the owner can elect installment payments for property taxes. Under current law, only residence homesteads and other residential properties with fewer than five living units are eligible for the election. Under this bill, all real property damaged in a disaster would be eligible. A business would be prohibited from electing to make installment payments if its gross receipts exceed $5 million in the 2009 tax year. For each subsequent tax year, the $5 million limit would be adjusted by the Comptroller to reflect changes in consumer inflation, and tax collectors would be required to use this adjusted limit. The bill would reduce the penalty for an unpaid installment from 12 percent to 6 percent of the unpaid amount. The bill's provision to expand the installment payment option from residential property to all real property except certain businesses would affect the timing of tax payments but not the amount. The bill would take effect immediately upon enactment, assuming that it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect September 1, 2009. Local Government Impact The bill's provision to reduce the penalty for unpaid installments from 12 percent to 6 percent of the unpaid amount would create a cost to taxing units. Neither the magnitude nor frequency of future disasters can be predicted. Further, the value of future disaster-damaged real property for which the owner elects to pay in installments and then becomes delinquent is unknown. As such, the fiscal impact cannot be estimated. Source Agencies:304 Comptroller of Public Accounts LBB Staff: JOB, MN, SD, SJS
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION
May 8, 2009
TO: Honorable Rene Oliveira, Chair, House Committee on Ways & Means FROM: John S. O'Brien, Director, Legislative Budget Board IN RE:HB1283 by Eiland (Relating to installment payments of ad valorem taxes on property in a disaster area.), Committee Report 1st House, Substituted
TO: Honorable Rene Oliveira, Chair, House Committee on Ways & Means
FROM: John S. O'Brien, Director, Legislative Budget Board
IN RE: HB1283 by Eiland (Relating to installment payments of ad valorem taxes on property in a disaster area.), Committee Report 1st House, Substituted
Honorable Rene Oliveira, Chair, House Committee on Ways & Means
Honorable Rene Oliveira, Chair, House Committee on Ways & Means
John S. O'Brien, Director, Legislative Budget Board
John S. O'Brien, Director, Legislative Budget Board
HB1283 by Eiland (Relating to installment payments of ad valorem taxes on property in a disaster area.), Committee Report 1st House, Substituted
HB1283 by Eiland (Relating to installment payments of ad valorem taxes on property in a disaster area.), Committee Report 1st House, Substituted
No fiscal implication to the State is anticipated.
No fiscal implication to the State is anticipated.
The bill would amend Chapter 31 of the Tax Code, regarding the collection of property taxes. The bill would increase the types of real property damaged in a disaster for which the owner can elect installment payments for property taxes. Under current law, only residence homesteads and other residential properties with fewer than five living units are eligible for the election. Under this bill, all real property damaged in a disaster would be eligible. A business would be prohibited from electing to make installment payments if its gross receipts exceed $5 million in the 2009 tax year. For each subsequent tax year, the $5 million limit would be adjusted by the Comptroller to reflect changes in consumer inflation, and tax collectors would be required to use this adjusted limit. The bill would reduce the penalty for an unpaid installment from 12 percent to 6 percent of the unpaid amount. The bill's provision to expand the installment payment option from residential property to all real property except certain businesses would affect the timing of tax payments but not the amount. The bill would take effect immediately upon enactment, assuming that it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect September 1, 2009.
The bill would amend Chapter 31 of the Tax Code, regarding the collection of property taxes.
The bill would increase the types of real property damaged in a disaster for which the owner can elect installment payments for property taxes. Under current law, only residence homesteads and other residential properties with fewer than five living units are eligible for the election. Under this bill, all real property damaged in a disaster would be eligible. A business would be prohibited from electing to make installment payments if its gross receipts exceed $5 million in the 2009 tax year. For each subsequent tax year, the $5 million limit would be adjusted by the Comptroller to reflect changes in consumer inflation, and tax collectors would be required to use this adjusted limit.
The bill would reduce the penalty for an unpaid installment from 12 percent to 6 percent of the unpaid amount.
The bill's provision to expand the installment payment option from residential property to all real property except certain businesses would affect the timing of tax payments but not the amount.
The bill would take effect immediately upon enactment, assuming that it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect September 1, 2009.
Local Government Impact
The bill's provision to reduce the penalty for unpaid installments from 12 percent to 6 percent of the unpaid amount would create a cost to taxing units. Neither the magnitude nor frequency of future disasters can be predicted. Further, the value of future disaster-damaged real property for which the owner elects to pay in installments and then becomes delinquent is unknown. As such, the fiscal impact cannot be estimated.
The bill's provision to reduce the penalty for unpaid installments from 12 percent to 6 percent of the unpaid amount would create a cost to taxing units. Neither the magnitude nor frequency of future disasters can be predicted. Further, the value of future disaster-damaged real property for which the owner elects to pay in installments and then becomes delinquent is unknown. As such, the fiscal impact cannot be estimated.
Source Agencies: 304 Comptroller of Public Accounts
304 Comptroller of Public Accounts
LBB Staff: JOB, MN, SD, SJS
JOB, MN, SD, SJS