| 2 | 4 | | |
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| 3 | 5 | | |
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| 4 | 6 | | A BILL TO BE ENTITLED |
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| 5 | 7 | | AN ACT |
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| 6 | 8 | | relating to the maximum amount of penalties that may be imposed for |
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| 7 | 9 | | delinquent taxes and tax reports and the application of taxpayer |
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| 8 | 10 | | payments to taxes, penalties, and interest. |
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| 9 | 11 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 10 | 12 | | SECTION 1. Subchapter B, Chapter 111, Tax Code, is amended |
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| 11 | 13 | | by adding Section 111.0512 to read as follows: |
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| 12 | 14 | | Sec. 111.0512. APPLICATION OF TAX PAYMENTS. |
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| 13 | 15 | | Notwithstanding any other law, the comptroller shall apply a |
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| 14 | 16 | | payment made by a taxpayer to the amount of tax due before applying |
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| 15 | 17 | | any portion of the payment to a penalty or interest owed by the |
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| 16 | 18 | | taxpayer unless the taxpayer provides written instructions for a |
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| 17 | 19 | | different application of the payment. |
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| 18 | 20 | | SECTION 2. Section 111.061, Tax Code, is amended by |
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| 19 | 21 | | amending Subsection (a) and adding Subsection (a-1) to read as |
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| 20 | 22 | | follows: |
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| 21 | 23 | | (a) A [Except as otherwise provided, a] penalty of five |
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| 22 | 24 | | percent of the tax due shall be imposed on a person who fails to pay |
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| 23 | 25 | | a tax imposed or file a report required by Title 2 or 3 of this code |
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| 24 | 26 | | when due, unless another law provides a lower penalty amount [and, |
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| 25 | 27 | | if the person fails to file the report or pay the tax within 30 days |
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| 26 | 28 | | after the day on which the tax or report is due, an additional five |
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| 27 | 29 | | percent penalty shall be imposed]. |
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| 28 | 30 | | (a-1) Notwithstanding any other law, a penalty imposed on a |
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| 29 | 31 | | person who fails to pay a tax imposed or file a report required by |
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| 30 | 32 | | Title 2 or 3 of this code when due may not exceed the amounts |
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| 31 | 33 | | provided by Subsection (a) and, if applicable, Subsection (b). |
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| 32 | 34 | | SECTION 3. Section 111.0512, Tax Code, as added by this Act, |
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| 33 | 35 | | applies only to a payment received on or after the effective date of |
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| 34 | 36 | | this Act. A payment received before the effective date of this Act |
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| 35 | 37 | | is governed by the law in effect on the date the payment was |
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| 36 | 38 | | received, and the former law is continued in effect for that |
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| 37 | 39 | | purpose. |
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| 38 | 40 | | SECTION 4. Section 111.061, Tax Code, as amended by this |
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| 39 | 41 | | Act, applies only to an amount of tax or a tax report that is |
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| 40 | 42 | | originally due on or after the effective date of this Act. A |
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| 41 | 43 | | penalty in connection with an amount of tax or a tax report that was |
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| 42 | 44 | | originally due before the effective date of this Act is governed by |
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| 43 | 45 | | the law in effect on the date the tax or tax report was originally |
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| 44 | 46 | | due, and the former law is continued in effect for that purpose. |
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| 45 | 47 | | SECTION 5. This Act takes effect September 1, 2025. |
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