84R13305 BEF-F
By: Capriglione H.B. No. 2941
A BILL TO BE ENTITLED
AN ACT
relating to the computation of wages and cash compensation for
purposes of the franchise tax.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 171.1013(a), Tax Code, is amended to
read as follows:
(a) Except as otherwise provided by this section, "wages and
cash compensation" means the amount entered in the Medicare wages
and tips box of Internal Revenue Service Form W-2 or any subsequent
form with a different number or designation that substantially
provides the same information. The term also includes, to the
extent not included above:
(1) a person's net distributive income from a taxable
entity treated as a partnership for federal income tax purposes,
but only if the person [receiving the distribution] is a natural
person, a professional association owned entirely by natural
persons, or a professional corporation owned entirely by natural
persons, and only if the amount is positive;
(2) a person's net distributive income from limited
liability companies and corporations treated as S corporations for
federal income tax purposes, but only if the person [receiving the
distribution] is a natural person and only if the amount is
positive;
(3) stock awards and stock options deducted for
federal income tax purposes; [and]
(4) a person's net distributive income from a limited
liability company treated as a sole proprietorship for federal
income tax purposes, but only if the person [receiving the
distribution] is a natural person and only if the amount is
positive; and
(5) payroll taxes paid by a taxable entity in
connection with the employment of an officer, director, owner,
partner, or employee.
SECTION 2. This Act applies only to a report originally due
on or after the effective date of this Act.
SECTION 3. This Act takes effect January 1, 2016.