Texas 2025 - 89th Regular

Texas House Bill HB3011 Compare Versions

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

Old	New	Differences
1	1	89R8661 RDS-D
2	2	By: Button H.B. No. 3011
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7	7	A BILL TO BE ENTITLED
8	8	AN ACT
9	9	relating to a franchise tax credit for taxable entities that make
10	10	certain employer child-care contributions.
11	11	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	12	SECTION 1. Chapter 171, Tax Code, is amended by adding
13	13	Subchapter N-1 to read as follows:
14	14	SUBCHAPTER N-1. TAX CREDIT FOR CHILD-CARE CONTRIBUTION
15	15	Sec. 171.721. DEFINITION. In this subchapter, "child-care
16	16	contribution" means the dollar amount of a contribution made by a
17	17	taxable entity to an employee of the entity for use by the employee
18	18	to secure child care at a child-care facility or family home
19	19	licensed under Chapter 42, Human Resources Code, including a
20	20	licensed child-care facility operated by the entity. The term does
21	21	not include wages paid by the taxable entity to the employee or a
22	22	payment to the employee that is considered compensation for the
23	23	employee's service.
24	24	Sec. 171.722. ENTITLEMENT TO CREDIT. A taxable entity is
25	25	entitled to a credit in the amount and under the conditions provided
26	26	by this subchapter against the tax imposed under this chapter.
27	27	Sec. 171.723. AMOUNT OF CREDIT; LIMITATION. (a) Subject to
28	28	Subsections (b) and (c), the amount of the credit a taxable entity
29	29	may claim on a report is equal to the total amount of child-care
30	30	contributions paid by the entity during the period on which the
31	31	report is based. For purposes of computing the total amount of
32	32	child-care contributions paid by the taxable entity, a child-care
33	33	contribution in an amount that exceeds $3,600 for a child is
34	34	considered to be a child-care contribution in the amount of $3,600
35	35	for that child.
36	36	(b) The total credit claimed on a report, including the
37	37	amount of any carryforward under Section 171.724, may not exceed
38	38	the amount of franchise tax due for the report after applying all
39	39	other applicable credits.
40	40	(c) The total amount of credits that may be awarded under
41	41	Subsection (a) in a state fiscal year may not exceed $25 million.
42	42	(d) The comptroller by rule shall prescribe procedures by
43	43	which the comptroller will allocate the amount of credits available
44	44	under Subsection (c). The procedures must provide that credits are
45	45	allocated to taxable entities that applied for the credit on a pro
46	46	rata basis.
47	47	Sec. 171.724. CARRYFORWARD. (a) If a taxable entity is
48	48	eligible for a credit that exceeds the limitation under Section
49	49	171.723(b), the entity may carry the unused credit forward for not
50	50	more than five consecutive reports.
51	51	(b) A carryforward is considered the remaining portion of a
52	52	credit that cannot be claimed on a report because of the limitation
53	53	under Section 171.723(b).
54	54	(c) Credits, including a carryforward, are considered to be
55	55	used in the following order:
56	56	(1) a carryforward under this section; and
57	57	(2) a credit for the period on which the report is
58	58	based.
59	59	Sec. 171.725. APPLICATION FOR CREDIT. (a) A taxable entity
60	60	must apply for a credit under this subchapter on or with the report
61	61	for the period for which the credit is claimed.
62	62	(b) A taxable entity must apply for the credit in the manner
63	63	prescribed by the comptroller and include with the application any
64	64	information requested by the comptroller to determine whether the
65	65	entity is eligible for the credit under this subchapter.
66	66	(c) The comptroller may award a credit to a taxable entity
67	67	that applies for the credit under Subsection (a) of this section if
68	68	the taxable entity is eligible for the credit and the credit is
69	69	available under Section 171.723(c). The comptroller has discretion
70	70	in determining whether to grant or deny an application for a credit.
71	71	(d) The comptroller shall notify a taxable entity in writing
72	72	of the comptroller's decision to grant or deny the application
73	73	submitted under Subsection (a). If the comptroller denies a
74	74	taxable entity's application, the comptroller shall include in the
75	75	notice of denial the reasons for the comptroller's decision.
76	76	Sec. 171.726. SALE OR ASSIGNMENT OF CREDIT. (a) A taxable
77	77	entity that makes a child-care contribution may sell or assign all
78	78	or part of the credit that may be claimed for that contribution to
79	79	one or more taxable entities, and any taxable entity to which all or
80	80	part of the credit is sold or assigned may sell or assign all or part
81	81	of the credit to another taxable entity. There is no limit on the
82	82	total number of transactions for the sale or assignment of all or
83	83	part of the total credit authorized under this subchapter.
84	84	(b) A taxable entity that sells or assigns a credit under
85	85	this section and the taxable entity to which the credit is sold or
86	86	assigned shall jointly submit written notice of the sale or
87	87	assignment to the comptroller not later than the 30th day after the
88	88	date of the sale or assignment. The notice must include:
89	89	(1) the date on which the credit was originally
90	90	established;
91	91	(2) the date of the sale or assignment;
92	92	(3) the amount of the credit sold or assigned and the
93	93	remaining period during which it may be used;
94	94	(4) the names, addresses, and federal tax
95	95	identification numbers of the taxable entity that sold or assigned
96	96	the credit or part of the credit and the taxable entity to which the
97	97	credit or part of the credit was sold or assigned; and
98	98	(5) the amount of the credit owned by the selling or
99	99	assigning taxable entity before the sale or assignment, and the
100	100	amount the selling or assigning taxable entity retained, if any,
101	101	after the sale or assignment.
102	102	(c) The sale or assignment of a credit in accordance with
103	103	this section does not extend the period for which a credit may be
104	104	carried forward.
105	105	(d) After a taxable entity claims a credit for a child-care
106	106	contribution under this subchapter, another entity may not use the
107	107	same expenditure as the basis for another credit.
108	108	Sec. 171.727. RULES. The comptroller shall adopt rules
109	109	necessary to implement and administer this subchapter.
110	110	SECTION 2. Subchapter N-1, Chapter 171, Tax Code, as added
111	111	by this Act, applies only to a report originally due on or after
112	112	January 1, 2026.
113	113	SECTION 3. This Act takes effect January 1, 2026.