85R2510 GRM-D
By: Romero, Jr. H.B. No. 42
A BILL TO BE ENTITLED
AN ACT
relating to a franchise tax credit for certain taxable entities
offering postsecondary tuition assistance.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 171, Tax Code, is amended by adding
Subchapter L-1 to read as follows:
SUBCHAPTER L-1. TAX CREDIT FOR CERTAIN ENTITIES THAT PROVIDE
TUITION ASSISTANCE
Sec. 171.621. DEFINITIONS. In this subchapter:
(1) "Neighborhood empowerment zone" has the meaning
assigned to "zone" by Section 378.001, Local Government Code.
(2) "Postsecondary educational institution" means any
public or private institution that provides courses of instruction
beyond that offered in secondary schools, including proprietary,
vocational, and technical schools.
Sec. 171.622. ELIGIBILITY FOR CREDIT. A taxable entity is
entitled to a credit in the amount and under the conditions and
limitations provided by this subchapter against the tax imposed
under this chapter.
Sec. 171.623. QUALIFICATION. A taxable entity qualifies
for a credit under this subchapter if:
(1) the taxable entity provides tuition assistance for
an employee attending a postsecondary educational institution;
(2) the taxable entity is located in a neighborhood
empowerment zone; and
(3) the amount of the taxable entity's total revenue
from its entire business for the reporting period for which the
credit is claimed is less than $250 million.
Sec. 171.624. AMOUNT; LIMITATION. (a) Except as otherwise
provided by this section, the amount of the credit for the period
covered by a tax report is equal to the lesser of the amount of
tuition assistance provided to all employees during the period and:
(1) $10,000, if the amount of the taxable entity's
total revenue from its entire business for the period is less than
$10 million;
(2) the greater of $10,000 and 50 percent of the amount
of franchise tax due for the report after all other applicable tax
credits, if the taxable entity's total revenue from its entire
business for the period is at least $10 million but less than $50
million; and
(3) the lesser of $50,000 and 50 percent of the amount
of franchise tax due for the report after all other applicable tax
credits, if the taxable entity's total revenue from its entire
business for the period is at least $50 million but less than $250
million.
(b) The total credit claimed on a tax report may not exceed
the amount of franchise tax due for the report after all other
applicable tax credits.
(c) A taxable entity may claim a credit under this
subchapter for an expenditure made during a reporting period only
against the tax owed for the period.
Sec. 171.625. APPLICATION FOR CREDIT. (a) A taxable entity
must apply for a credit under this subchapter on or with the tax
report for the period for which the credit is claimed.
(b) The comptroller shall adopt a form for the application
for the credit. A taxable entity must use the form in applying for
the credit.
Sec. 171.626. ASSIGNMENT PROHIBITED. A taxable entity may
not convey, assign, or transfer the credit allowed under this
subchapter to another taxable entity unless all of the assets of the
taxable entity are conveyed, assigned, or transferred in the same
transaction.
Sec. 171.627. RULES. The comptroller shall adopt rules
necessary to implement this subchapter.
Sec. 171.628. EXPIRATION. This subchapter expires December
31, 2022.
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, 2018.