Texas 2009 - 81st Regular

Texas House Bill HB3237 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	81R10985 KLA-D
2	2	By: Callegari H.B. No. 3237
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the franchise tax.
8	8	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	9	SECTION 1. Section 171.002(d), Tax Code, is amended to read
10	10	as follows:
11	11	(d) A taxable entity is not required to pay any tax and is
12	12	not considered to owe any tax for a period if:
13	13	(1) the amount of tax computed for the taxable entity
14	14	is less than $1,000; or
15	15	(2) the amount of the taxable entity's total revenue
16	16	from its entire business is less than or equal to $1 million
17	17	[$300,000] or the amount determined under Section 171.006 per
18	18	12-month period on which margin is based.
19	19	SECTION 2. Section 171.006(b), Tax Code, is amended to read
20	20	as follows:
21	21	(b) On [Beginning in 2010, on] January 1 of each
22	22	even-numbered year, the amounts prescribed by Sections
23	23	171.002(d)(2)[, 171.0021,] and 171.1013(c) are increased or
24	24	decreased by an amount equal to the amount prescribed by those
25	25	sections on December 31 of the preceding year multiplied by the
26	26	percentage increase or decrease during the preceding state fiscal
27	27	biennium in the consumer price index and rounded to the nearest
28	28	$10,000.
29	29	SECTION 3. Section 171.1012, Tax Code, is amended by adding
30	30	Subsection (q) to read as follows:
31	31	(q) Subject to Section 171.1014, a taxable entity that
32	32	elects to subtract cost of goods sold for the purpose of computing
33	33	its taxable margin may, instead of determining its cost of goods
34	34	sold in accordance with the other provisions of this section, elect
35	35	to determine cost of goods sold as follows:
36	36	(1) for a taxable entity treated for federal income
37	37	tax purposes as a corporation, the cost of goods sold is the amount
38	38	reportable as cost of goods sold on line 2, Internal Revenue Service
39	39	Form 1120;
40	40	(2) for a taxable entity treated for federal income
41	41	tax purposes as a partnership, the cost of goods sold is the amount
42	42	reportable as cost of goods sold on line 2, Internal Revenue Service
43	43	Form 1065;
44	44	(3) for a taxable entity treated for federal income
45	45	tax purposes as an S corporation, the cost of goods sold is the
46	46	amount reportable as cost of goods sold on line 2, Internal Revenue
47	47	Service Form 1120S; or
48	48	(4) for any other taxable entity, the cost of goods
49	49	sold is an amount determined in a manner substantially equivalent
50	50	to the amount for Subdivision (1), (2), or (3) determined by rules
51	51	the comptroller shall adopt.
52	52	SECTION 4. Section 171.1013, Tax Code, is amended by
53	53	amending Subsection (a) and adding Subsection (i) to read as
54	54	follows:
55	55	(a) Except as otherwise provided by this section, "wages and
56	56	cash compensation" means the amount entered in the Medicare wages
57	57	and tips box of Internal Revenue Service Form W-2 or any subsequent
58	58	form with a different number or designation that substantially
59	59	provides the same information. The term also includes, to the
60	60	extent not included above:
61	61	(1) net distributive income from a taxable entity
62	62	treated as a partnership for federal income tax purposes, but only
63	63	if the person receiving the distribution is a natural person or a
64	64	professional corporation or professional association owned by a
65	65	natural person, to the extent the net distributive income is not
66	66	less than zero;
67	67	(2) net distributive income from limited liability
68	68	companies and corporations treated as S corporations for federal
69	69	income tax purposes, but only if the person receiving the
70	70	distribution is a natural person;
71	71	(3) stock awards and stock options deducted for
72	72	federal income tax purposes; and
73	73	(4) net distributive income from a limited liability
74	74	company treated as a sole proprietorship for federal income tax
75	75	purposes, but only if the person receiving the distribution is a
76	76	natural person.
77	77	(i) Subject to Section 171.1014 and the limitation in
78	78	Subsection (c), a taxable entity that elects to subtract
79	79	compensation for the purpose of computing its taxable margin under
80	80	Section 171.101 may include as wages and cash compensation any
81	81	compensation paid to an independent contractor as reported on
82	82	Internal Revenue Service Form 1099, or any subsequent form with a
83	83	different number or designation that substantially provides the
84	84	same information.
85	85	SECTION 5. Sections 171.1016(a) and (b), Tax Code, are
86	86	amended to read as follows:
87	87	(a) Notwithstanding any other provision of this chapter, a
88	88	taxable entity [whose total revenue from its entire business is not
89	89	more than $10 million] may elect to pay the tax imposed under this
90	90	chapter in the amount computed and at the rate provided by this
91	91	section rather than in the amount computed and at the tax rate
92	92	provided by Section 171.002.
93	93	(b) The amount of the tax for which a taxable entity that
94	94	elects to pay the tax as provided by this section is liable is
95	95	computed by:
96	96	(1) determining the taxable entity's total revenue
97	97	from its entire business, as determined under Section 171.1011;
98	98	(2) apportioning the amount computed under
99	99	Subdivision (1) to this state, as provided by Section 171.106, to
100	100	determine the taxable entity's apportioned total revenue; and
101	101	(3) multiplying the amount computed under Subdivision
102	102	(2) by the rate of 0.45 [0.575] percent.
103	103	SECTION 6. Sections 171.0021 and 171.1016(d), Tax Code, are
104	104	repealed.
105	105	SECTION 7. This Act applies only to a report originally due
106	106	on or after the effective date of this Act.
107	107	SECTION 8. This Act takes effect January 1, 2010.