Bill Text: TX HB3380 | 2021-2022 | 87th Legislature | Introduced
Bill Title: Relating to the franchise tax credit for certain research and development activities.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2021-03-22 - Referred to Ways & Means [HB3380 Detail]
Download: Texas-2021-HB3380-Introduced.html
87R8743 BEF-D | ||
By: Leman | H.B. No. 3380 |
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relating to the franchise tax credit for certain research and | ||
development activities. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 171.651, Tax Code, is amended by adding | ||
Subdivision (1-a) and amending Subdivision (4) to read as follows: | ||
(1-a) "Production costs" include the cost of: | ||
(A) materials; | ||
(B) labor; | ||
(C) supplies; | ||
(D) pilot models; and | ||
(E) products manufactured or produced. | ||
(4) "Qualified research expense" has the meaning | ||
assigned by Section 41, Internal Revenue Code, except that the | ||
expense must be for research conducted in this state. The term | ||
includes an expense described by Section 171.6515. | ||
SECTION 2. Subchapter M, Chapter 171, Tax Code, is amended | ||
by adding Section 171.6515 to read as follows: | ||
Sec. 171.6515. QUALIFIED RESEARCH EXPENSES RELATING TO | ||
RESEARCH INVOLVING PRODUCTION PROCESS. A taxable entity that | ||
conducts qualified research for which the business component is a | ||
production process may treat as a qualified research expense | ||
production costs incurred while conducting that research, | ||
regardless of whether the costs: | ||
(1) include a taxable item exempted from sales and use | ||
taxes under Section 151.318; or | ||
(2) would have been incurred in the process if the | ||
qualified research were not conducted. | ||
SECTION 3. This Act applies only to a report originally due | ||
on or after the effective date of this Act. | ||
SECTION 4. This Act takes effect January 1, 2022. |