87R1487 SMT-F
By: Lucio S.B. No. 1567
A BILL TO BE ENTITLED
AN ACT
relating to insurance premium tax credits for the construction or
rehabilitation of a supportive housing property.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle B, Title 3, Insurance Code, is amended
by adding Chapter 234 to read as follows:
CHAPTER 234. PREMIUM TAX CREDIT FOR CONSTRUCTION OR REHABILITATION
OF SUPPORTIVE HOUSING PROPERTY
Sec. 234.0001. DEFINITIONS. In this chapter:
(1) "Corporation" means the Texas State Affordable
Housing Corporation established under Subchapter Y, Chapter 2306,
Government Code.
(2) "Eligible costs and expenses" means costs and
expenses incurred in the construction or rehabilitation of a
supportive housing property that the corporation determines are
reasonable and necessary for the construction or rehabilitation of
the property.
(3) "State premium tax liability" means liability
incurred by an entity under Chapter 222.
(4) "Supportive housing property" means a residential
rental development consisting of integrated, affordable, and
accessible housing that provides residents with the opportunity to
receive assistance in coordinating on-site or off-site
health-related and other services and supports that foster
independence in living and decision-making for persons with
disabilities and persons who are elderly.
Sec. 234.0002. ELIGIBILITY FOR CREDIT. (a) An entity is
eligible to apply for and claim a credit against state premium tax
liability for eligible costs and expenses in the amount and under
the limitations provided by this chapter if:
(1) the supportive housing property is placed in
service on or after September 1, 2021; and
(2) the total amount of the eligible costs and
expenses incurred by the entity exceeds $5,000.
(b) An entity may be eligible for a credit under this
chapter regardless of whether the entity incurs state premium tax
liability.
Sec. 234.0003. CERTIFICATION OF ELIGIBILITY. (a) Before
applying for, claiming, selling, or assigning a credit under this
chapter, the entity that constructed or rehabilitated the
supportive housing property must request from the corporation a
certificate of eligibility on which the corporation certifies that
the costs and expenses incurred meet the definition of eligible
costs and expenses. The entity must include with the entity's
request information about the property that is sufficient for the
corporation to determine whether the property meets the definition
of a supportive housing property.
(b) The corporation shall issue a certificate of
eligibility to an entity that has incurred eligible costs and
expenses as provided by this chapter. The certificate must:
(1) confirm that the property to which the eligible
costs and expenses relate is supportive housing property; and
(2) confirm the date the supportive housing property
was placed in service or, if the property is not in service,
estimate the date the property will be placed in service.
(c) The corporation by rule shall prescribe procedures by
which the corporation may allocate credits under this chapter. The
corporation may not certify eligible costs and expenses that exceed
the annual limit provided by Section 234.0004(d).
Sec. 234.0004. AMOUNT OF CREDIT; LIMITATIONS. (a) The
total credit under this chapter that may be claimed with respect to
a single supportive housing property may not exceed 20 percent of
the total eligible costs and expenses incurred in the construction
or rehabilitation of the property.
(b) The total credit that may be claimed on a tax report,
including the amount of any carryforward under Section 234.0005,
may not exceed the amount of state premium tax liability due for the
report after all other applicable tax credits.
(c) Eligible costs and expenses may be counted only once in
determining the amount of the tax credit available, and more than
one entity may not claim a credit for the same eligible costs and
expenses.
(d) The total amount of tax credits that may be claimed by
all entities under this chapter may not exceed $5 million in a state
fiscal year.
Sec. 234.0005. CARRYFORWARD. (a) If an entity is eligible
for a credit that exceeds the limitation under Section 234.0004(b),
the entity may carry the unused credit forward for not more than
five consecutive tax reports.
(b) A carryforward is considered the remaining portion of a
credit that cannot be claimed in the current year because of the
limitation under Section 234.0004(b).
Sec. 234.0006. APPLICATION FOR CREDIT; CLAIMING CREDIT.
(a) An entity must apply for a credit under this chapter on a form
promulgated by the comptroller for that purpose.
(b) An entity shall include with the application:
(1) a copy of the certificate of eligibility issued
under Section 234.0003;
(2) an audited cost report issued by a certified
public accountant, as defined by Section 901.002, Occupations Code,
that itemizes the eligible costs and expenses incurred by the
entity;
(3) an attestation of the total eligible costs and
expenses incurred by the entity; and
(4) any other information required by the comptroller
to sufficiently demonstrate that the entity is eligible for the
credit and to determine the amount of the credit.
(c) The burden of establishing eligibility for and the value
of the credit is on the entity.
(d) For purposes of approving the credit, the comptroller
may rely on the audited cost report provided by the entity that
requested the credit.
(e) The comptroller shall issue a credit certificate to an
entity the comptroller determines is eligible for a credit under
this chapter indicating that the entity is the owner of the credit
and the amount of credit available to the entity.
(f) An entity may claim a credit under this chapter on or
with the tax report due under Section 222.005. The entity shall
include with each tax report on which a credit is claimed the
certificate issued by the comptroller under Subsection (e).
Sec. 234.0007. SALE OR ASSIGNMENT OF CREDIT. (a) An entity
that incurs eligible costs and expenses may sell or assign all or
part of the credit that may be claimed for those costs and expenses
to one or more entities, and any entity to which all or part of the
credit is sold or assigned may sell or assign all or part of the
credit to another entity. There is no limit on the total number of
transactions for the sale or assignment of all or part of the total
credit authorized under this chapter. Collectively all transfers
are subject to the maximum total limits provided by Section
234.0004.
(b) An entity that sells or assigns a credit under this
chapter to another entity shall provide to the purchaser or
assignee:
(1) a copy of the certificate of eligibility issued
under Section 234.0003; and
(2) the audited cost report described by Section
234.0006(b).
(c) An entity that sells or assigns a credit under this
section and the entity to which the credit is sold or assigned shall
jointly submit written notice of the sale or assignment to the
comptroller on a form promulgated by the comptroller not later than
the 30th day after the date of the sale or assignment. The notice
must include:
(1) the date of the sale or assignment;
(2) the amount of the credit sold or assigned;
(3) the names and federal tax identification numbers
of the entity that sold or assigned the credit or part of the credit
and the entity to which the credit or part of the credit was sold or
assigned; and
(4) the amount of the credit owned by the selling or
assigning entity before the sale or assignment and the amount the
selling or assigning entity retained, if any, after the sale or
assignment.
(d) The sale or assignment of a credit in accordance with
this section does not extend the period for which a credit may be
carried forward and does not increase the total amount of the credit
that may be claimed. After an entity claims a credit for eligible
costs and expenses, another entity may not use the same costs and
expenses as the basis for claiming a credit.
(e) Notwithstanding the requirements of this chapter, a
credit earned or purchased by, or assigned to, a partnership,
limited liability company, S corporation, or other pass-through
entity may be allocated to the partners, members, or shareholders
of that entity and claimed under this chapter in accordance with the
provisions of any agreement among the partners, members, or
shareholders and without regard to the ownership interest of the
partners, members, or shareholders in the supportive housing
property, provided that the entity that claims the credit must be
subject to the tax imposed under Chapter 222.
Sec. 234.0008. RETALIATORY TAX. An entity that claims a
credit under this chapter is not required to pay any additional
retaliatory tax levied under Chapter 281 as a result of the credit.
Sec. 234.0009. RULES. The corporation and the comptroller
shall adopt rules necessary to implement this chapter.
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 September 1, 2023.