| 1 | 1 | | 84R10830 CBH-F |
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| 2 | 2 | | By: Bohac H.B. No. 3354 |
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| 3 | 3 | | |
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| 4 | 4 | | |
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| 5 | 5 | | A BILL TO BE ENTITLED |
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| 6 | 6 | | AN ACT |
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| 7 | 7 | | relating to the transfer of certain unused franchise tax credits. |
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| 8 | 8 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 9 | 9 | | SECTION 1. Section 18, Chapter 1 (H.B. 3), Acts of the 79th |
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| 10 | 10 | | Legislature, 3rd Called Session, 2006, is amended by adding |
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| 11 | 11 | | Subsections (h-1), (i-1), (j), and (k) to read as follows: |
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| 12 | 12 | | (h-1) In this subsection and Subsection (i-1) of this |
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| 13 | 13 | | section, "transfer" includes a sale. Notwithstanding Subsections |
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| 14 | 14 | | (e) and (f) of this section and subject to Subsection (k) of this |
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| 15 | 15 | | section, a corporation that had unused credits before January 1, |
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| 16 | 16 | | 2008, under former Subchapter P or Q, Chapter 171, Tax Code, that |
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| 17 | 17 | | expired under the terms of one of those former subchapters or under |
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| 18 | 18 | | Subsection (e) or (f) of this section, may transfer the right to the |
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| 19 | 19 | | expired credits to another taxpayer of this state. A transferred |
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| 20 | 20 | | credit is considered to be newly established by the taxpayer to |
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| 21 | 21 | | which the credit is transferred on the date the transfer is |
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| 22 | 22 | | complete. To be eligible to transfer the credits, the corporation |
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| 23 | 23 | | must obtain a certificate of transfer of credit from the |
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| 24 | 24 | | comptroller for the amount of the credits to be transferred. Not |
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| 25 | 25 | | later than the 30th day after the date of the transfer, the |
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| 26 | 26 | | corporation must submit to the comptroller a notice of the transfer |
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| 27 | 27 | | in a form prescribed by the comptroller. The notice must be |
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| 28 | 28 | | accompanied by a copy of the certificate of transfer issued by the |
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| 29 | 29 | | comptroller and specify: |
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| 30 | 30 | | (1) the number on the certificate of transfer; |
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| 31 | 31 | | (2) the amount of the corporation's unused credits |
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| 32 | 32 | | preceding the transfer; |
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| 33 | 33 | | (3) the date of the transfer; |
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| 34 | 34 | | (4) the amount of credits transferred; |
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| 35 | 35 | | (5) the tax identification numbers of the corporation |
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| 36 | 36 | | and the taxpayer to which the credits were transferred; |
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| 37 | 37 | | (6) the corporation's remaining amount of unused |
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| 38 | 38 | | credits after the transfer; and |
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| 39 | 39 | | (7) any other information the comptroller requires. |
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| 40 | 40 | | (i-1) The transfer of a credit under Subsection (h-1) of |
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| 41 | 41 | | this section is limited to an unused credit for which the |
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| 42 | 42 | | corporation was eligible before January 1, 2008, and does not |
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| 43 | 43 | | include credits authorized under former Subchapter Q-1, Chapter |
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| 44 | 44 | | 171, Tax Code, or credits that were created under the terms of a |
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| 45 | 45 | | written agreement between a taxpayer and the Texas Department of |
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| 46 | 46 | | Economic Development or its successor that was entered into before |
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| 47 | 47 | | June 1, 2006, and that continue to accrue under the terms provided |
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| 48 | 48 | | by Section 19 of this Act. The transferee of a credit under this |
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| 49 | 49 | | section obtains the credit subject to the same rights and |
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| 50 | 50 | | privileges as the transferor had on the date the credit was |
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| 51 | 51 | | originally established. The transfer of a credit under Subsection |
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| 52 | 52 | | (h-1) of this section does not extend or lessen the period during |
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| 53 | 53 | | which the credit may be claimed after the credit is newly |
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| 54 | 54 | | established by the taxpayer to which the credit is transferred as |
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| 55 | 55 | | provided by that subsection. If a corporation transfers a credit |
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| 56 | 56 | | that the corporation was not entitled to transfer at the time of the |
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| 57 | 57 | | transfer: |
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| 58 | 58 | | (1) the taxpayer to which the credit was transferred |
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| 59 | 59 | | may pursue any remedy authorized by law against the corporation and |
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| 60 | 60 | | may not pursue any remedy against the comptroller or this state; and |
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| 61 | 61 | | (2) the comptroller: |
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| 62 | 62 | | (A) may not allow the taxpayer to which the |
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| 63 | 63 | | credit was transferred to apply the credit on a report for a tax |
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| 64 | 64 | | listed in Subsection (j) of this section; or |
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| 65 | 65 | | (B) shall recover from the taxpayer the amount of |
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| 66 | 66 | | the credit the taxpayer claims on a report using any means |
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| 67 | 67 | | authorized by law. |
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| 68 | 68 | | (j) A taxpayer to which a credit is transferred under |
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| 69 | 69 | | Subsection (h-1) of this section may apply the credit against: |
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| 70 | 70 | | (1) the taxes due under Chapters 151, 152, 154, 155, |
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| 71 | 71 | | 156, 158, 160, 161, 162, 171, 181, 182, 183, 191, 201, 202, and 203, |
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| 72 | 72 | | Tax Code; and |
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| 73 | 73 | | (2) a contribution due under Subtitle A, Title 4, |
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| 74 | 74 | | Labor Code. |
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| 75 | 75 | | (k) A corporation may not transfer an unused tax credit |
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| 76 | 76 | | under Subsection (h-1) of this section after August 31, 2017. |
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| 77 | 77 | | SECTION 2. This Act applies only to a report originally due |
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| 78 | 78 | | on or after the effective date of this Act. |
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| 79 | 79 | | SECTION 3. This Act takes effect September 1, 2015. |
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