Texas 2021 - 87th Regular

Texas Senate Bill SB813 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	S.B. No. 813
	1	+	By: Hughes S.B. No. 813
	2	+	(Hefner)
2	3
3	4
	5	+	A BILL TO BE ENTITLED
4	6		AN ACT
5	7		relating to the insurance premium tax credit for the certified
6	8		rehabilitation of certified historic structures.
7	9		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
8	10		SECTION 1. Subtitle B, Title 3, Insurance Code, is amended
9	11		by adding Chapter 231 to read as follows:
10	12		CHAPTER 231. PREMIUM TAX CREDIT FOR CERTIFIED REHABILITATION OF
11	13		CERTIFIED HISTORIC STRUCTURES
12	14		Sec. 231.0001. DEFINITIONS. In this chapter:
13	15		(1) "Certified historic structure" means a property in
14	16		this state that is:
15	17		(A) listed individually in the National Register
16	18		of Historic Places;
17	19		(B) designated as a Recorded Texas Historic
18	20		Landmark under Section 442.006, Government Code, or as a state
19	21		archeological landmark under Chapter 191, Natural Resources Code;
20	22		or
21	23		(C) certified by the commission as contributing
22	24		to the historic significance of:
23	25		(i) a historic district listed in the
24	26		National Register of Historic Places; or
25	27		(ii) a local district certified by the
26	28		United States Department of the Interior in accordance with 36
27	29		C.F.R. Section 67.9.
28	30		(2) "Certified rehabilitation" means the
29	31		rehabilitation of a certified historic structure that the
30	32		commission has certified as meeting the United States secretary of
31	33		the interior's Standards for Rehabilitation as defined in 36 C.F.R.
32	34		Section 67.7.
33	35		(3) "Commission" means the Texas Historical
34	36		Commission.
35	37		(4) "Eligible costs and expenses" means qualified
36	38		rehabilitation expenditures as defined by Section 47(c)(2),
37	39		Internal Revenue Code of 1986, except that the depreciation and
38	40		tax-exempt use provisions of that section do not apply to costs and
39	41		expenses incurred by a federal tax-exempt organization, and those
40	42		costs and expenses are eligible costs and expenses if the other
41	43		provisions of Section 47(c)(2), Internal Revenue Code of 1986, are
42	44		satisfied.
43	45		(5) "Federal tax-exempt organization" means an entity
44	46		exempted from the federal income tax under Section 501(a), Internal
45	47		Revenue Code of 1986.
46	48		(6) "State premium tax liability" means any liability
47	49		incurred by an entity under Chapter 221, 222, 223, or 224.
48	50		Sec. 231.0002. ELIGIBILITY FOR CREDIT. An entity is
49	51		eligible to apply for a credit against state premium tax liability
50	52		in the amount and under the conditions provided by this chapter.
51	53		Sec. 231.0003. QUALIFICATION. An entity is eligible for a
52	54		credit for eligible costs and expenses incurred in the certified
53	55		rehabilitation of a certified historic structure as provided by
54	56		this chapter if:
55	57		(1) the rehabilitated certified historic structure is
56	58		placed in service on or after September 1, 2021;
57	59		(2) the entity has an ownership interest in the
58	60		certified historic structure in the year during which the structure
59	61		is placed in service after the rehabilitation; and
60	62		(3) the total amount of the eligible costs and
61	63		expenses incurred exceeds $5,000.
62	64		Sec. 231.0004. CERTIFICATION OF ELIGIBILITY. (a) Before
63	65		claiming, selling, or assigning a credit under this chapter, the
64	66		entity that incurred the eligible costs and expenses in the
65	67		rehabilitation of a certified historic structure must request from
66	68		the commission a certificate of eligibility on which the commission
67	69		certifies that the work performed meets the definition of a
68	70		certified rehabilitation. The entity must include with the
69	71		entity's request:
70	72		(1) information on the property that is sufficient for
71	73		the commission to determine whether the property meets the
72	74		definition of a certified historic structure; and
73	75		(2) information on the rehabilitation, and
74	76		photographs before and after work is performed, sufficient for the
75	77		commission to determine whether the rehabilitation meets the United
76	78		States secretary of the interior's Standards for Rehabilitation as
77	79		defined in 36 C.F.R. Section 67.7.
78	80		(b) The commission shall issue a certificate of eligibility
79	81		to an entity that has incurred eligible costs and expenses as
80	82		provided by this chapter. The certificate must:
81	83		(1) confirm that:
82	84		(A) the property to which the eligible costs and
83	85		expenses relate is a certified historic structure; and
84	86		(B) the rehabilitation qualifies as a certified
85	87		rehabilitation; and
86	88		(2) specify the date the certified historic structure
87	89		was first placed in service after the rehabilitation.
88	90		(c) The entity must forward the certificate of eligibility
89	91		and the following documentation to the comptroller to claim the
90	92		credit:
91	93		(1) an audited cost report issued by a certified
92	94		public accountant, as defined by Section 901.002, Occupations Code,
93	95		that itemizes the eligible costs and expenses incurred in the
94	96		certified rehabilitation of the certified historic structure by the
95	97		entity;
96	98		(2) the date the certified historic structure was
97	99		first placed in service after the rehabilitation and evidence of
98	100		that placement in service; and
99	101		(3) an attestation of the total eligible costs and
100	102		expenses incurred by the entity on the rehabilitation of the
101	103		certified historic structure.
102	104		(d) For purposes of approving the credit under Subsection
103	105		(c), the comptroller may rely on the audited cost report provided by
104	106		the entity that requested the credit.
105	107		(e) An entity that sells or assigns a credit under this
106	108		chapter to another entity shall provide a copy of the certificate of
107	109		eligibility, together with the audited cost report, to the
108	110		purchaser or assignee.
109	111		Sec. 231.0005. AMOUNT OF CREDIT; LIMITATIONS. (a) The
110	112		total amount of the credit under this chapter with respect to the
111	113		rehabilitation of a single certified historic structure that may be
112	114		claimed may not exceed 25 percent of the total eligible costs and
113	115		expenses incurred in the certified rehabilitation of the certified
114	116		historic structure.
115	117		(b) The total credit that may be claimed on a tax report,
116	118		including the amount of any carryforward under Section 231.0006,
117	119		may not exceed the amount of state premium tax liability due for the
118	120		report after any other applicable credits.
119	121		(c) Eligible costs and expenses may be counted only once in
120	122		determining the amount of the credit available, and more than one
121	123		entity may not claim a credit for the same eligible costs and
122	124		expenses.
123	125		Sec. 231.0006. CARRYFORWARD. (a) If an entity is eligible
124	126		for a credit that exceeds the limitation under Section 231.0005(b),
125	127		the entity may carry the unused credit forward for not more than
126	128		five consecutive tax reports.
127	129		(b) A carryforward is considered the remaining portion of a
128	130		credit that cannot be claimed in the current year because of the
129	131		limitation under Section 231.0005(b).
130	132		Sec. 231.0007. APPLICATION FOR CREDIT. (a) An entity must
131	133		apply for a credit under this chapter on or with the tax report for
132	134		the period for which the credit is claimed.
133	135		(b) An entity shall file with any tax report on which the
134	136		credit is claimed a copy of the certificate of eligibility issued by
135	137		the commission under Section 231.0004 and any other information
136	138		required by the comptroller to sufficiently demonstrate that the
137	139		entity is eligible for the credit.
138	140		(c) The burden of establishing eligibility for and the value
139	141		of the credit is on the entity.
140	142		Sec. 231.0008. SALE OR ASSIGNMENT OF CREDIT. (a) An entity
141	143		that incurs eligible costs and expenses may sell or assign all or
142	144		part of the credit that may be claimed for those costs and expenses
143	145		to one or more entities, and any entity to which all or part of the
144	146		credit is sold or assigned may sell or assign all or part of the
145	147		credit to another entity. There is no limit on the total number of
146	148		transactions for the sale or assignment of all or part of the total
147	149		credit authorized under this chapter, however, collectively all
148	150		transfers are subject to the maximum total limits provided by
149	151		Section 231.0005.
150	152		(b) An entity that sells or assigns a credit under this
151	153		section and the entity to which the credit is sold or assigned shall
152	154		jointly submit written notice of the sale or assignment to the
153	155		comptroller on a form promulgated by the comptroller not later than
154	156		the 30th day after the date of the sale or assignment. The notice
155	157		must include:
156	158		(1) the date of the sale or assignment;
157	159		(2) the amount of the credit sold or assigned;
158	160		(3) the names and federal tax identification numbers
159	161		of the entity that sold or assigned the credit or part of the credit
160	162		and the entity to which the credit or part of the credit was sold or
161	163		assigned; and
162	164		(4) the amount of the credit owned by the selling or
163	165		assigning entity before the sale or assignment, and the amount the
164	166		selling or assigning entity retained, if any, after the sale or
165	167		assignment.
166	168		(c) The sale or assignment of a credit in accordance with
167	169		this section does not extend the period for which a credit may be
168	170		carried forward and does not increase the total amount of the credit
169	171		that may be claimed. After an entity claims a credit under this
170	172		chapter for eligible costs and expenses, another entity may not use
171	173		the same costs and expenses as the basis for claiming a credit under
172	174		this chapter or Subchapter S, Chapter 171, Tax Code.
173	175		(d) Notwithstanding the requirements of this chapter, a
174	176		credit earned or purchased by, or assigned to, a partnership,
175	177		limited liability company, S corporation, or other pass-through
176	178		entity may be allocated to the partners, members, or shareholders
177	179		of that entity and claimed under this chapter in accordance with the
178	180		provisions of any agreement among the partners, members, or
179	181		shareholders and without regard to the ownership interest of the
180	182		partners, members, or shareholders in the rehabilitated certified
181	183		historic structure, provided that the entity that claims the credit
182	184		must be subject to the tax imposed under Chapter 221, 222, 223, or
183	185		224.
184	186		Sec. 231.0009. RETALIATORY TAX. An entity that claims a
185	187		credit under this chapter is not required to pay any additional
186	188		retaliatory tax levied under Chapter 281 as a result of the credit.
187	189		Sec. 231.0010. RULES. The commission and the comptroller
188	190		shall adopt rules necessary to implement this chapter.
189	191		SECTION 2. Section 171.908(c), Tax Code, is amended to read
190	192		as follows:
191	193		(c) The sale or assignment of a credit in accordance with
192	194		this section does not extend the period for which a credit may be
193	195		carried forward and does not increase the total amount of the credit
194	196		that may be claimed. After an entity claims a credit under this
195	197		subchapter for eligible costs and expenses, another entity may not
196	198		use the same costs and expenses as the basis for claiming a credit
197	199		under this subchapter or Chapter 231, Insurance Code.
198	200		SECTION 3. (a) Section 171.908(e), Tax Code, is repealed.
199	201		(b) The repeal of Section 171.908(e), Tax Code, by this
200	202		section does not affect a credit that accrued under Subchapter S,
201	203		Chapter 171, Tax Code, before the effective date of this Act. The
202	204		provisions of that subchapter as they existed immediately before
203	205		the effective date of this Act are continued in effect for purposes
204	206		of determining the amount of the credit an entity may claim and the
205	207		manner in which the entity may claim, sell, or assign the credit or
206	208		claim any carryforward of the credit.
207	209		SECTION 4. Chapter 231, Insurance Code, as added by this
208	210		Act, applies only to a report originally due on or after January 1,
209	211		2022.
210	212		SECTION 5. This Act takes effect January 1, 2022.
211		-	______________________________ ______________________________
212		-	President of the Senate Speaker of the House
213		-	I hereby certify that S.B. No. 813 passed the Senate on
214		-	April 9, 2021, by the following vote: Yeas 31, Nays 0.
215		-	______________________________
216		-	Secretary of the Senate
217		-	I hereby certify that S.B. No. 813 passed the House on
218		-	May 8, 2021, by the following vote: Yeas 134, Nays 5, two present
219		-	not voting.
220		-	______________________________
221		-	Chief Clerk of the House
222		-	Approved:
223		-	______________________________
224		-	Date
225		-	______________________________
226		-	Governor