Texas 2017 - 85th Regular

Texas House Bill HB3566 Compare Versions

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

Old	New	Differences
1	1	85R13318 GRM-D
2	2	By: Ashby H.B. No. 3566
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to a franchise credit for entities that make certain
8	8	railroad reconstruction or replacement expenditures.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Chapter 171, Tax Code, is amended by adding
11	11	Subchapter U-1 to read as follows:
12	12	SUBCHAPTER U-1. TAX CREDIT FOR QUALIFIED RAILROAD RECONSTRUCTION OR
13	13	REPLACEMENT EXPENDITURES
14	14	Sec. 171.9231. DEFINITIONS. In this subchapter:
15	15	(1) "Class II railroad" and "class III railroad" have
16	16	the meanings assigned by the United States Surface Transportation
17	17	Board.
18	18	(2) "Qualified railroad expenditure" means an amount
19	19	spent by a taxable entity that is a class II railroad or class III
20	20	railroad:
21	21	(A) to reconstruct or replace railroad
22	22	infrastructure that was owned or leased by the taxable entity on
23	23	January 1, 2017, including a track, a roadbed, a bridge, an
24	24	industrial lead, or another track-related structure; or
25	25	(B) for new construction of an industrial lead,
26	26	switch, spur, or siding or extension of existing siding.
27	27	Sec. 171.9232. ENTITLEMENT TO CREDIT. A taxable entity is
28	28	entitled to a credit in the amount and under the conditions provided
29	29	by this subchapter against the tax imposed under this chapter.
30	30	Sec. 171.9233. QUALIFICATION. A taxable entity qualifies
31	31	for a credit under this subchapter if the taxable entity makes a
32	32	qualified railroad expenditure.
33	33	Sec. 171.9234. AMOUNT; LIMITATIONS. (a) Subject to
34	34	Subsection (b), the amount of the credit for a report is equal to
35	35	the lesser of:
36	36	(1) 50 percent of the taxable entity's qualified
37	37	railroad expenditures during the accounting period on which the
38	38	report is based; or
39	39	(2) the product of $3,500 and the number of miles of
40	40	railroad track owned or leased in this state by the entity on the
41	41	last day of the accounting period on which the report is based.
42	42	(b) The total credit claimed for a report, including the
43	43	amount of any carryforward under Section 171.9235, may not exceed
44	44	the amount of franchise tax due for the report after any other
45	45	applicable tax credits.
46	46	Sec. 171.9235. CARRYFORWARD. (a) If a taxable entity is
47	47	eligible for a credit that exceeds the limitation under Section
48	48	171.9234(b), the taxable entity may carry the unused credit forward
49	49	for not more than five consecutive reports.
50	50	(b) A carryforward is considered the remaining portion of a
51	51	credit that cannot be claimed in the current year because of the
52	52	limitation under Section 171.9234(b). A carryforward is added to
53	53	the next year's credit in determining whether the limitation is met
54	54	for that year. A credit carryforward from a previous report is
55	55	considered to be used before the current year credit.
56	56	Sec. 171.9236. APPLICATION FOR CREDIT. A taxable entity
57	57	must apply for a credit under this subchapter on or with the report
58	58	for the period for which the credit is claimed.
59	59	Sec. 171.9237. SALE OR ASSIGNMENT OF CREDIT. (a) A taxable
60	60	entity that makes qualified railroad expenditures may sell or
61	61	assign all or part of the credit that may be claimed for those
62	62	expenditures to one or more taxable entities, and any taxable
63	63	entity to which all or part of the credit is sold or assigned may
64	64	sell or assign all or part of the credit to another taxable entity.
65	65	There is no limit on the total number of transactions for the sale
66	66	or assignment of all or part of the total credit authorized under
67	67	this subchapter.
68	68	(b) A taxable entity that sells or assigns a credit under
69	69	this section and the taxable entity to which the credit is sold or
70	70	assigned shall jointly submit written notice of the sale or
71	71	assignment to the comptroller not later than the 30th day after the
72	72	date of the sale or assignment. The notice must include:
73	73	(1) the date on which the credit was originally
74	74	established;
75	75	(2) the date of the sale or assignment;
76	76	(3) the amount of the credit sold or assigned and the
77	77	remaining period during which it may be used;
78	78	(4) the names, addresses, and federal tax
79	79	identification numbers of the taxable entity that sold or assigned
80	80	the credit or part of the credit and the taxable entity to which the
81	81	credit or part of the credit was sold or assigned; and
82	82	(5) the amount of the credit owned by the selling or
83	83	assigning taxable entity before the sale or assignment, and the
84	84	amount the selling or assigning taxable entity retained, if any,
85	85	after the sale or assignment.
86	86	(c) The sale or assignment of a credit in accordance with
87	87	this section does not extend the period for which a credit may be
88	88	carried forward.
89	89	Sec. 171.9238. RULES. (a) Except as provided by Subsection
90	90	(b), the comptroller shall adopt rules necessary to implement this
91	91	subchapter.
92	92	(b) The Texas Department of Transportation shall adopt
93	93	rules to verify qualified railroad expenditures and allow taxable
94	94	entities to obtain preapproval that a proposed expenditure will
95	95	qualify as a qualified railroad expenditure.
96	96	SECTION 2. This Act applies only to a report originally due
97	97	under Chapter 171, Tax Code, on or after the effective date of this
98	98	Act.
99	99	SECTION 3. This Act takes effect January 1, 2018.