| 1 | 1 | | 87R5765 SMT-F |
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| 2 | 2 | | By: Thierry H.B. No. 2627 |
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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 clarification of certain provisions regarding taxes |
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| 8 | 8 | | imposed on the sale, rental, and use of motor vehicles. |
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| 9 | 9 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 10 | 10 | | SECTION 1. Section 152.001(14), Tax Code, is amended to |
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| 11 | 11 | | read as follows: |
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| 12 | 12 | | (14) "Nonprofit" means: |
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| 13 | 13 | | (A) organized as a nonprofit corporation that is |
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| 14 | 14 | | governed by Chapter 22, Business Organizations Code [under the |
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| 15 | 15 | | Texas Non-Profit Corporation Act (Article 1396-1.01 et seq., |
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| 16 | 16 | | Vernon's Texas Civil Statutes)]; or |
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| 17 | 17 | | (B) organized and operated in a way that does not |
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| 18 | 18 | | result in accrual of distributable profits, realization of private |
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| 19 | 19 | | gain resulting from payment of compensation other than reasonable |
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| 20 | 20 | | compensation for services rendered by persons who are not members |
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| 21 | 21 | | of the organization, or realization of any other form of private |
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| 22 | 22 | | gain. |
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| 23 | 23 | | SECTION 2. Section 152.002(c), Tax Code, is amended to read |
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| 24 | 24 | | as follows: |
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| 25 | 25 | | (c) A person who is in the business of selling, renting, or |
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| 26 | 26 | | leasing motor vehicles, who obtains the certificate of title under |
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| 27 | 27 | | Chapter 501, Transportation Code, to a motor vehicle, and who uses |
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| 28 | 28 | | that motor vehicle in this state for business or personal purposes |
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| 29 | 29 | | may deduct its fair market value from the total consideration paid |
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| 30 | 30 | | for a replacement vehicle if: |
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| 31 | 31 | | (1) the person obtains the certificate of title under |
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| 32 | 32 | | Chapter 501, Transportation Code, to the replacement motor vehicle; |
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| 33 | 33 | | (2) the person uses the replacement motor vehicle in |
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| 34 | 34 | | this state for business or personal purposes; and |
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| 35 | 35 | | (3) the replaced motor vehicle is offered for sale. |
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| 36 | 36 | | SECTION 3. The amendments made by this Act are a |
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| 37 | 37 | | clarification of existing law and do not imply that existing law may |
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| 38 | 38 | | be construed as inconsistent with the law as amended by this Act. |
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| 39 | 39 | | SECTION 4. This Act takes effect immediately if it receives |
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| 40 | 40 | | a vote of two-thirds of all the members elected to each house, as |
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| 41 | 41 | | provided by Section 39, Article III, Texas Constitution. If this |
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| 42 | 42 | | Act does not receive the vote necessary for immediate effect, this |
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| 43 | 43 | | Act takes effect September 1, 2021. |
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