Texas 2019 - 86th Regular

Texas House Bill HB1068 Compare Versions

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

Old	New	Differences
1	1	86R1947 GRM-D
2	2	By: Ashby H.B. No. 1068
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to strategies for railroad relocation and improvement,
8	8	including a franchise tax credit for certain railroad
9	9	reconstruction or replacement expenditures.
10	10	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
11	11	SECTION 1. Chapter 171, Tax Code, is amended by adding
12	12	Subchapter U-1 to read as follows:
13	13	SUBCHAPTER U-1. TAX CREDIT FOR QUALIFIED RAILROAD RECONSTRUCTION OR
14	14	REPLACEMENT EXPENDITURES
15	15	Sec. 171.9231. DEFINITIONS. In this subchapter:
16	16	(1) "Class II railroad" and "class III railroad" have
17	17	the meanings assigned by the federal Surface Transportation 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, 2019, 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 taxable entity
41	41	on the last day of the accounting period on which the report is
42	42	based.
43	43	(b) The total credit claimed for a report, including the
44	44	amount of any carryforward under Section 171.9235, may not exceed
45	45	the amount of franchise tax due for the report after all other
46	46	applicable tax credits.
47	47	Sec. 171.9235. CARRYFORWARD. (a) If a taxable entity is
48	48	eligible for a credit that exceeds the limitation under Section
49	49	171.9234(b), the taxable entity may carry the unused credit forward
50	50	for not more than five consecutive reports.
51	51	(b) A carryforward is considered the remaining portion of a
52	52	credit that cannot be claimed in the current year because of the
53	53	limitation under Section 171.9234(b). A carryforward is added to
54	54	the next year's credit in determining whether the limitation is met
55	55	for that year. A credit carryforward from a previous report is
56	56	considered to be used before the current year credit.
57	57	Sec. 171.9236. APPLICATION FOR CREDIT. A taxable entity
58	58	must apply for a credit under this subchapter on or with the report
59	59	for the period for which the credit is claimed.
60	60	Sec. 171.9237. SALE OR ASSIGNMENT OF CREDIT. (a) A taxable
61	61	entity that makes qualified railroad expenditures may sell or
62	62	assign all or part of the credit that may be claimed for those
63	63	expenditures to one or more taxable entities, and any taxable
64	64	entity to which all or part of the credit is sold or assigned may
65	65	sell or assign all or part of the credit to another taxable entity.
66	66	There is no limit on the total number of transactions for the sale
67	67	or assignment of all or part of the total credit authorized under
68	68	this subchapter.
69	69	(b) A taxable entity that sells or assigns a credit under
70	70	this section and the taxable entity to which the credit is sold or
71	71	assigned shall jointly submit written notice of the sale or
72	72	assignment to the comptroller not later than the 30th day after the
73	73	date of the sale or assignment. The notice must include:
74	74	(1) the date on which the credit was originally
75	75	established;
76	76	(2) the date of the sale or assignment;
77	77	(3) the amount of the credit sold or assigned and the
78	78	remaining period during which it may be used;
79	79	(4) the names, addresses, and federal tax
80	80	identification numbers of the taxable entity that sold or assigned
81	81	the credit or part of the credit and the taxable entity to which the
82	82	credit or part of the credit was sold or assigned; and
83	83	(5) the amount of the credit owned by the selling or
84	84	assigning taxable entity before the sale or assignment, and the
85	85	amount the selling or assigning taxable entity retained, if any,
86	86	after the sale or assignment.
87	87	(c) The sale or assignment of a credit in accordance with
88	88	this section does not extend the period for which a credit may be
89	89	carried forward.
90	90	Sec. 171.9238. RULES. (a) Except as provided by Subsection
91	91	(b), the comptroller shall adopt rules necessary to implement this
92	92	subchapter.
93	93	(b) The Texas Department of Transportation shall adopt
94	94	rules to verify qualified railroad expenditures and allow taxable
95	95	entities to obtain preapproval that a proposed expenditure will
96	96	qualify as a qualified railroad expenditure.
97	97	SECTION 2. The Texas Department of Transportation shall
98	98	complete development of the strategic plan described in Section
99	99	201.977, Transportation Code, not later than December 31, 2020.
100	100	SECTION 3. Subchapter U-1, Chapter 171, Tax Code, as added
101	101	by this Act, applies only to a report originally due under Chapter
102	102	171, Tax Code, on or after January 1, 2020.
103	103	SECTION 4. This Act takes effect January 1, 2020.