By: Geren, et al. (Senate Sponsor - Hancock) H.B. No. 1195
(In the Senate - Received from the House April 6, 2021;
April 6, 2021, read first time and referred to Committee on
Finance; April 13, 2021, reported favorably by the following vote:
Yeas 14, Nays 0; April 13, 2021, sent to printer.)
Click here to see the committee vote
A BILL TO BE ENTITLED
AN ACT
relating to the franchise tax treatment of certain loans and grants
made under the federal Coronavirus Aid, Relief, and Economic
Security Act.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter C, Chapter 171, Tax Code, is amended
by adding Section 171.10131 to read as follows:
Sec. 171.10131. PROVISIONS RELATED TO CERTAIN MONEY
RECEIVED FOR COVID-19 RELIEF. (a) In this section, "qualifying
loan or grant proceeds" means the amount of money that:
(1) is received by a taxable entity in loans or grants:
(A) under the Coronavirus Aid, Relief, and
Economic Security Act (15 U.S.C. Section 9001 et seq.), as amended
by the Paycheck Protection Program Flexibility Act of 2020 (Pub. L.
No. 116-142) and the Consolidated Appropriations Act, 2021 (Pub. L.
No. 116-260); or
(B) from the restaurant revitalization fund
established under Section 5003 of the American Rescue Plan Act of
2021 (Pub. L. No. 117-2); and
(2) is not included in the taxable entity's gross
income for purposes of federal income taxation under:
(A) Sections 276 and 278 of the Consolidated
Appropriations Act, 2021 (Pub. L. No. 116-260); or
(B) Section 9673 of the American Rescue Plan Act
of 2021 (Pub. L. No. 117-2).
(b) Notwithstanding any other law, a taxable entity:
(1) shall exclude from its total revenue, to the
extent included under Section 171.1011(c)(1)(A), (c)(2)(A), or
(c)(3), qualifying loan or grant proceeds;
(2) may include as a cost of goods sold under Section
171.1012 any expense paid using qualifying loan or grant proceeds
to the extent the expense is otherwise includable as a cost of goods
sold under that section; and
(3) may include as compensation under Section 171.1013
any expense paid using qualifying loan or grant proceeds to the
extent the expense is otherwise includable as compensation under
that section.
SECTION 2. This Act applies only to a report originally due
on or after January 1, 2021.
SECTION 3. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2021.
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