Texas 2025 - 89th Regular

Texas Senate Bill SB2018 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
	1	+	89R10422 SRA-D
1	2		By: Paxton, et al. S.B. No. 2018
2		-	(In the Senate - Filed March 6, 2025; March 17, 2025, read
3		-	first time and referred to Committee on Finance; April 9, 2025,
4		-	reported favorably by the following vote: Yeas 13, Nays 0;
5		-	April 9, 2025, sent to printer.)
6		-	Click here to see the committee vote
	3	+
	4	+
7	5
8	6
9	7		A BILL TO BE ENTITLED
10	8		AN ACT
11	9		relating to the strong families credit against certain taxes for
12	10		entities that contribute to certain organizations.
13	11		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
14	12		SECTION 1. Chapter 201, Alcoholic Beverage Code, is amended
15	13		by adding Subchapter D to read as follows:
16	14		SUBCHAPTER D. STRONG FAMILIES TAX CREDIT
17	15		Sec. 201.101. DEFINITIONS. In this subchapter:
18	16		(1) "Designated contribution," "eligible
19	17		organization," and "strong families credit" have the meanings
20	18		assigned by Section 171.801, Tax Code.
21	19		(2) "Taxpayer" means a person who pays a tax under this
22	20		chapter.
23	21		Sec. 201.102. ELIGIBILITY. A taxpayer that makes a
24	22		designated contribution that meets the requirements of Subchapter
25	23		P, Chapter 171, Tax Code, is entitled to apply for a strong families
26	24		credit in the amount and under the conditions provided by this
27	25		subchapter against taxes paid under this chapter.
28	26		Sec. 201.103. AMOUNT OF CREDIT; LIMITATIONS. (a) Subject
29	27		to Subsections (b) and (c), the amount of a taxpayer's credit for a
30	28		state fiscal year is equal to the lesser of:
31	29		(1) the amount of designated contributions made to
32	30		eligible organizations during the state fiscal year; or
33	31		(2) the amount of taxes paid by the taxpayer under this
34	32		chapter during the state fiscal year.
35	33		(b) The maximum amount of strong families credits that may
36	34		be awarded is the amount provided by Section 171.805(c), Tax Code.
37	35		(c) The maximum amount of designated contributions a
38	36		taxpayer may make to all eligible organizations in a state fiscal
39	37		year is the amount provided by Section 171.805(b), Tax Code.
40	38		(d) The comptroller shall allocate strong families credits
41	39		as provided by Section 171.805(d), Tax Code.
42	40		Sec. 201.104. APPLICATION. (a) A taxpayer must apply to
43	41		claim a strong families credit against a tax imposed under this
44	42		chapter.
45	43		(b) A taxpayer must apply for the credit in the manner
46	44		prescribed by the comptroller and include with the application any
47	45		information requested by the comptroller to determine whether the
48	46		taxpayer is eligible for the credit under this subchapter.
49	47		(c) The comptroller may award a credit to a taxpayer who
50	48		applies for the credit under Subsection (a) if the taxpayer is
51	49		eligible for the credit and the credit is available under Section
52	50		171.805(c), Tax Code.
53	51		(d) The comptroller shall notify a taxpayer in writing of
54	52		the comptroller's decision to grant or deny the application under
55	53		Subsection (a). If the comptroller denies a taxpayer's
56	54		application, the comptroller shall include in the notice of denial
57	55		the reasons for the comptroller's decision.
58	56		Sec. 201.105. RULES. The comptroller may adopt rules and
59	57		procedures necessary to implement, administer, and enforce this
60	58		subchapter.
61	59		Sec. 201.106. EXPIRATION. (a) This subchapter expires
62	60		January 1, 2028.
63	61		(b) The expiration of this subchapter does not affect
64	62		credits for which a taxpayer is eligible after the date this
65	63		subchapter expires based on designated contributions made before
66	64		that date.
67	65		SECTION 2. Subtitle B, Title 3, Insurance Code, is amended
68	66		by adding Chapter 230 to read as follows:
69	67		CHAPTER 230. STRONG FAMILIES TAX CREDIT
70	68		Sec. 230.001. DEFINITIONS. In this chapter:
71	69		(1) "Designated contribution," "eligible
72	70		organization," and "strong families credit" have the meanings
73	71		assigned by Section 171.801, Tax Code.
74	72		(2) "State insurance tax liability" means any tax
75	73		liability incurred by an entity under Chapters 221 through 226 or
76	74		Chapter 281.
77	75		Sec. 230.002. ELIGIBILITY. An entity that makes a
78	76		designated contribution that meets the requirements of Subchapter
79	77		P, Chapter 171, Tax Code, is entitled to apply for a strong families
80	78		credit in the amount and under the conditions provided by this
81	79		chapter against the entity's state insurance tax liability.
82	80		Sec. 230.003. AMOUNT OF CREDIT; LIMITATION ON TOTAL
83	81		CREDITS. (a) Subject to Subsections (b) and (c), the amount of an
84	82		entity's credit for a report is equal to the lesser of:
85	83		(1) the amount of designated contributions made to an
86	84		eligible organization during the year covered by the report; or
87	85		(2) the amount of the entity's state insurance tax
88	86		liability for the year covered by the report after applying all
89	87		other applicable credits.
90	88		(b) The maximum amount of strong families credits that may
91	89		be awarded is the amount provided by Section 171.805(c), Tax Code.
92	90		(c) The maximum amount of designated contributions an
93	91		entity may make to all eligible organizations in a state fiscal year
94	92		is the amount provided by Section 171.805(b), Tax Code.
95	93		(d) The comptroller shall allocate strong families credits
96	94		as provided by Section 171.805(d), Tax Code.
97	95		Sec. 230.004. APPLICATION FOR CREDIT. (a) An entity must
98	96		apply to claim a strong families credit under this chapter on or
99	97		with the report covering the year in which the designated
100	98		contribution was made.
101	99		(b) An entity must apply for the credit in the manner
102	100		prescribed by the comptroller and include with the application any
103	101		information requested by the comptroller to determine whether the
104	102		entity is eligible for the credit under this chapter.
105	103		(c) The comptroller may award a credit to an entity that
106	104		applies for the credit under Subsection (a) if the entity is
107	105		eligible for the credit and the credit is available under Section
108	106		171.805(c), Tax Code.
109	107		Sec. 230.005. ASSIGNMENT PROHIBITED; EXCEPTION. An entity
110	108		may not convey, assign, or transfer a strong families credit to
111	109		another entity unless substantially all of the assets of the entity
112	110		are conveyed, assigned, or transferred in the same transaction.
113	111		Sec. 230.006. RULES. The comptroller may adopt rules and
114	112		procedures necessary to implement, administer, and enforce this
115	113		chapter.
116	114		Sec. 230.007. EXPIRATION. (a) This chapter expires
117	115		January 1, 2028.
118	116		(b) The expiration of this chapter does not affect credits
119	117		for which an entity is eligible after the date this chapter expires
120	118		based on designated contributions made before that date.
121	119		SECTION 3. Chapter 171, Tax Code, is amended by adding
122	120		Subchapter P to read as follows:
123	121		SUBCHAPTER P. STRONG FAMILIES TAX CREDIT
124	122		Sec. 171.801. DEFINITIONS. In this subchapter:
125	123		(1) "At-risk family" has the meaning assigned by
126	124		Section 137.002, Human Resources Code.
127	125		(2) "Commission" means the Health and Human Services
128	126		Commission.
129	127		(3) "Designated contribution" means a monetary
130	128		contribution to an eligible organization that the contributor
131	129		designates at the time of contribution as being made for the purpose
132	130		of the strong families credit.
133	131		(4) "Eligible organization" means an organization
134	132		that is certified by the commission as an eligible organization
135	133		under this subchapter.
136	134		(5) "Strong families credit" means the tax credit
137	135		established under this subchapter that may be claimed under:
138	136		(A) Subchapter D, Chapter 201, Alcoholic
139	137		Beverage Code;
140	138		(B) Chapter 230, Insurance Code;
141	139		(C) this subchapter; or
142	140		(D) Chapter 203.
143	141		Sec. 171.802. ELIGIBILITY FOR CREDIT. A taxable entity
144	142		that makes a designated contribution that meets the requirements of
145	143		this subchapter is eligible to apply for a strong families credit in
146	144		the amount and under the conditions provided by this subchapter
147	145		against the tax imposed under this chapter.
148	146		Sec. 171.803. QUALIFICATIONS FOR ELIGIBLE ORGANIZATION;
149	147		CERTIFICATION OF ELIGIBILITY. (a) An organization may apply to the
150	148		commission for certification as an eligible organization under this
151	149		subchapter if the organization:
152	150		(1) is exempt from federal income taxation under
153	151		Section 501(a), Internal Revenue Code of 1986, as an organization
154	152		described by Section 501(c)(3) of that code;
155	153		(2) is authorized to transact business in this state;
156	154		(3) has provided the following in this state for at
157	155		least three years preceding the organization's initial application
158	156		for certification as an eligible organization:
159	157		(A) comprehensive case management services for
160	158		at-risk families based on an assessment of family strengths and
161	159		needs, including assisting families in achieving self-sufficiency,
162	160		stability, and encouraging workforce participation; and
163	161		(B) services and resources to assist fathers in
164	162		learning and improving parenting skills and being more engaged in
165	163		their children's lives through in-school programs and online
166	164		resources;
167	165		(4) does not directly or indirectly provide abortion
168	166		services, or offer information related to abortion services; and
169	167		(5) has not received, either directly or indirectly
170	168		through a contractor, more than 50 percent of its total annual
171	169		revenue from this state or a political subdivision of this state in
172	170		the preceding state fiscal year.
173	171		(b) Services and resources described by Subsection (a)(3)
174	172		must be implemented with a continuous quality improvement process
175	173		and evaluated based on outcomes.
176	174		(c) An organization must reapply for certification as an
177	175		eligible organization each calendar year by submitting to the
178	176		commission a signed application form containing:
179	177		(1) a description of the qualifying services and
180	178		resources provided by the organization;
181	179		(2) the total number of individuals served through the
182	180		services and resources described by Subdivision (1) during the
183	181		previous calendar year and the number of those individuals served
184	182		and provided with resources that year using designated
185	183		contributions;
186	184		(3) outcomes for services and resources described by
187	185		Subdivision (1);
188	186		(4) the organization's financial information;
189	187		(5) the organization's contact information;
190	188		(6) a statement, signed under penalty of perjury by an
191	189		officer of the organization, that the organization meets all
192	190		criteria to qualify as an eligible organization, has fulfilled the
193	191		requirements for the previous calendar year, and intends to fulfill
194	192		the requirements for the next calendar year; and
195	193		(7) any other documentation requested by the
196	194		commission to verify eligibility or compliance with this section.
197	195		(d) The commission shall:
198	196		(1) issue a certificate of eligibility to an eligible
199	197		applicant stating that the organization meets the qualifications of
200	198		an eligible organization;
201	199		(2) revoke an organization's certificate of
202	200		eligibility if the organization violates this subchapter or fails
203	201		to maintain the eligibility requirements of this subchapter;
204	202		(3) publish information about the strong families
205	203		credit on the commission's Internet website, including:
206	204		(A) the requirements and process for an
207	205		organization to be certified as an eligible organization; and
208	206		(B) a list of organizations currently certified
209	207		as eligible organizations; and
210	208		(4) require the return of designated contributions
211	209		made to an organization that has had the organization's
212	210		certification as an eligible organization revoked or that otherwise
213	211		fails to comply with the requirements of this subchapter.
214	212		(e) An organization that is required to return
215	213		contributions under Subsection (d)(4) is ineligible for
216	214		certification as an eligible organization.
217	215		(f) An organization whose certification as an eligible
218	216		organization lapses or is revoked for a reason other than the reason
219	217		described by Subsection (d)(4) may reapply for certification as an
220	218		eligible organization.
221	219		Sec. 171.804. DUTIES OF ELIGIBLE ORGANIZATION. (a) An
222	220		eligible organization shall:
223	221		(1) conduct a local, state, and national criminal
224	222		background check for all individuals working directly with children
225	223		in a program funded by designated contributions that includes the
226	224		use of:
227	225		(A) a commercial multistate and
228	226		multijurisdiction criminal records locator or other similar
229	227		commercial nationwide database; and
230	228		(B) the national sex offender registry database
231	229		maintained by the United States Department of Justice or a
232	230		successor agency;
233	231		(2) spend all designated contributions, other than the
234	232		amount described by Subdivision (3), to provide services or
235	233		resources for residents of this state;
236	234		(3) spend no more than five percent of the total dollar
237	235		amount of designated contributions on administrative expenses; and
238	236		(4) annually submit to the comptroller:
239	237		(A) the report of an audit of the eligible
240	238		organization conducted by an independent certified public
241	239		accountant in accordance with generally accepted auditing
242	240		principles completed not later than the 180th day after the end of
243	241		the eligible organization's fiscal year; and
244	242		(B) a copy of the eligible organization's most
245	243		recent Form 990 filed with the Internal Revenue Service.
246	244		(b) On receipt of a designated contribution, an eligible
247	245		organization shall provide the entity making the contribution with
248	246		a certificate of contribution that includes:
249	247		(1) the entity's name;
250	248		(2) the eligible organization's name;
251	249		(3) the entity's federal employer identification
252	250		number, if applicable;
253	251		(4) the amount of the designated contribution; and
254	252		(5) the date the designated contribution was made.
255	253		Sec. 171.805. AMOUNT OF CREDIT; LIMITATION ON TOTAL
256	254		CREDITS. (a) Subject to Subsections (b) and (c), the amount of a
257	255		taxable entity's credit for a report is equal to the lesser of:
258	256		(1) the amount of designated contributions made to
259	257		eligible organizations during the period covered by the report; or
260	258		(2) the amount of franchise tax due for the report
261	259		after applying all other applicable credits.
262	260		(b) A taxable entity may not apply for a credit for a report
263	261		in connection with more than $1 million in designated
264	262		contributions.
265	263		(c) The total amount of strong families credits awarded may
266	264		not exceed $10 million.
267	265		(d) The comptroller by rule shall prescribe procedures by
268	266		which the comptroller will allocate strong families credits. The
269	267		procedures must provide that any credits are allocated to entities
270	268		that apply on a first-come, first-served basis.
271	269		Sec. 171.806. CARRYFORWARD. (a) If a taxable entity is
272	270		eligible for a credit that exceeds the limitation under Section
273	271		171.805(a), the entity may carry the unused credit forward for not
274	272		more than five consecutive reports.
275	273		(b) A carryforward is considered the remaining portion of a
276	274		credit that cannot be claimed on a report because of the limitation
277	275		under Section 171.805(a).
278	276		Sec. 171.807. APPLICATION FOR CREDIT. (a) A taxable entity
279	277		must apply to claim a strong families credit under this subchapter
280	278		on or with the report covering the period in which the designated
281	279		contribution was made.
282	280		(b) A taxable entity must apply for the credit in the manner
283	281		prescribed by the comptroller and include with the application any
284	282		information requested by the comptroller to determine whether the
285	283		entity is eligible for the credit under this subchapter.
286	284		(c) The comptroller may award a credit to a taxable entity
287	285		that applies for the credit under Subsection (a) if the taxable
288	286		entity is eligible for the credit and the credit is available under
289	287		Section 171.805(c).
290	288		(d) The comptroller shall notify a taxable entity in writing
291	289		of the comptroller's decision to grant or deny the application
292	290		under Subsection (a). If the comptroller denies a taxable entity's
293	291		application, the comptroller shall include in the notice of denial
294	292		the reasons for the comptroller's decision.
295	293		Sec. 171.808. ASSIGNMENT PROHIBITED; EXCEPTION. A taxable
296	294		entity may not convey, assign, or transfer a strong families credit
297	295		awarded under this subchapter to another taxable entity unless
298	296		substantially all of the assets of the taxable entity are conveyed,
299	297		assigned, or transferred in the same transaction.
300	298		Sec. 171.809. RULES. The commission and the comptroller
301	299		may adopt rules and procedures necessary to implement, administer,
302	300		and enforce this subchapter.
303	301		Sec. 171.810. EXPIRATION. (a) This subchapter expires
304	302		January 1, 2028.
305	303		(b) The expiration of this subchapter does not affect the
306	304		carryforward of a credit under Section 171.806 or those credits for
307	305		which a taxable entity is eligible after the date this subchapter
308	306		expires based on designated contributions made before that date.
309	307		SECTION 4. Subtitle I, Title 2, Tax Code, is amended by
310	308		adding Chapter 203 to read as follows:
311	309		CHAPTER 203. STRONG FAMILIES TAX CREDIT
312	310		Sec. 203.001. DEFINITIONS. In this chapter, "designated
313	311		contribution," "eligible organization," and "strong families
314	312		credit" have the meanings assigned by Section 171.801.
315	313		Sec. 203.002. ELIGIBILITY. A producer that makes a
316	314		designated contribution that meets the requirements of Subchapter
317	315		P, Chapter 171, is entitled to apply for a strong families credit in
318	316		the amount and under the conditions provided by this chapter
319	317		against tax paid under Chapter 201 or 202.
320	318		Sec. 203.003. AMOUNT OF CREDIT; LIMITATIONS. (a) Subject
321	319		to Subsections (b) and (c), the amount of a producer's credit for a
322	320		state fiscal year is equal to the lesser of:
323	321		(1) the amount of designated contributions made to
324	322		eligible organizations during the state fiscal year; or
325	323		(2) the amount of taxes paid by the producer under
326	324		Chapter 201 or 202, as applicable, during the state fiscal year.
327	325		(b) The maximum amount of strong families credits that may
328	326		be awarded is the amount provided by Section 171.805(c).
329	327		(c) The maximum amount of designated contributions a
330	328		producer may make to all eligible organizations in a state fiscal
331	329		year is the amount provided by Section 171.805(b).
332	330		(d) The comptroller shall allocate strong families credits
333	331		as provided by Section 171.805(d).
334	332		Sec. 203.004. APPLICATION. (a) The person responsible for
335	333		paying the tax under Chapter 201 or 202 must apply to claim a strong
336	334		families credit against that tax.
337	335		(b) The person responsible for paying the tax must apply for
338	336		the credit in the manner prescribed by the comptroller and include
339	337		with the application any information requested by the comptroller
340	338		to determine whether the person is eligible for the credit under
341	339		this section.
342	340		(c) The comptroller may award a credit to a person who
343	341		applies for the credit under Subsection (a) if the person is
344	342		eligible for the credit and the credit is available under Section
345	343		171.805(c).
346	344		(d) The comptroller shall notify a person in writing of the
347	345		comptroller's decision to grant or deny the application under
348	346		Subsection (a). If the comptroller denies a person's application,
349	347		the comptroller shall include in the notice of denial the reasons
350	348		for the comptroller's decision.
351	349		Sec. 203.005. RULES. The comptroller may adopt rules and
352	350		procedures necessary to implement, administer, and enforce this
353	351		chapter.
354	352		Sec. 203.006. EXPIRATION. (a) This chapter expires
355	353		January 1, 2028.
356	354		(b) The expiration of this chapter does not affect credits
357	355		for which a person is eligible after the date this chapter expires
358	356		based on designated contributions made before that date.
359	357		SECTION 5. (a) An entity may apply for a credit under
360	358		Subchapter D, Chapter 201, Alcoholic Beverage Code, as added by
361	359		this Act, Chapter 230, Insurance Code, as added by this Act,
362	360		Subchapter P, Chapter 171, Tax Code, as added by this Act, or
363	361		Chapter 203, Tax Code, as added by this Act, only for a designated
364	362		contribution made on or after January 1, 2026.
365	363		(b) Subchapter D, Chapter 201, Alcoholic Beverage Code, as
366	364		added by this Act, Chapter 230, Insurance Code, as added by this
367	365		Act, Subchapter P, Chapter 171, Tax Code, as added by this Act, and
368	366		Chapter 203, Tax Code, as added by this Act, apply only to a report
369	367		originally due on or after January 1, 2026.
370	368		SECTION 6. This Act takes effect January 1, 2026.
371		-	* * * * *