Bill Text: TX HB52 | 2019-2020 | 86th Legislature | Comm Sub


Bill Title: Relating to a franchise tax credit pilot program for taxable entities that contribute to an employee dependent care flexible spending account.

Spectrum: Moderate Partisan Bill (Democrat 4-1)

Status: (Introduced - Dead) 2019-04-29 - Committee report sent to Calendars [HB52 Detail]

Download: Texas-2019-HB52-Comm_Sub.html
  86R23635 GRM-D
 
  By: Hinojosa, Wray, Martinez Fischer, H.B. No. 52
      Guillen, Cole
 
  Substitute the following for H.B. No. 52:
 
  By:  Rodriguez C.S.H.B. No. 52
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to a franchise tax credit pilot program for taxable
  entities that contribute to an employee dependent care flexible
  spending account.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Chapter 171, Tax Code, is amended by adding
  Subchapter P to read as follows:
  SUBCHAPTER P. TAX CREDIT PILOT PROGRAM FOR EMPLOYER CONTRIBUTIONS
  TO DEPENDENT CARE FLEXIBLE SPENDING ACCOUNTS
         Sec. 171.801.  DEFINITION. In this subchapter, "dependent
  care flexible spending account" means a pretax benefit account used
  to pay eligible dependent care services as authorized by the
  Internal Revenue Code of 1986, as effective on January 1, 2019.
         Sec. 171.802.  ENTITLEMENT TO CREDIT. A taxable entity is
  entitled to a credit in the amount and under the conditions provided
  by this subchapter against the tax imposed under this chapter.
         Sec. 171.803.  QUALIFICATION. (a)  Subject to Subsection
  (b), a taxable entity qualifies for a credit under this subchapter
  if the taxable entity:
               (1)  has an average of not more than 500 employees
  during the period on which the report is based; and
               (2)  contributes to the dependent care flexible
  spending account of each employee of the taxable entity who
  maintains an account and receives from the taxable entity an annual
  salary or wage of not more than $65,000.
         (b)  A combined group qualifies for a credit under this
  subchapter in connection with any member of the combined group that
  satisfies the requirements of Subsection (a).
         Sec. 171.804.  AMOUNT OF CREDIT; LIMITATIONS.  (a)  Subject
  to Subsection (b), the amount of the credit for a report in
  connection with each employee described by Section 171.803(a)(2) is
  equal to the lesser of:
               (1)  50 percent of the contributions made by the
  taxable entity to the employee's dependent care flexible spending
  account, excluding any portion of a contribution returned to the
  taxable entity; or
               (2)  $2,500.
         (b)  The total amount of the credit for each report is equal
  to the lesser of:
               (1)  the total of the credits allowed under Subsection
  (a) for the reporting period for all employees; or
               (2)  the amount of franchise tax due after applying all
  other applicable credits.
         Sec. 171.805.  APPLICATION FOR CREDIT. (a)  A taxable entity
  must apply for a credit under this subchapter on or with the tax
  report for the period for which the credit is claimed.
         (b)  The comptroller shall promulgate a form for the
  application for the credit. A taxable entity must use the form in
  applying for the credit.
         Sec. 171.806.  PERIOD FOR WHICH CREDIT MAY BE CLAIMED. A
  taxable entity may claim a credit under this subchapter for a report
  only in connection with contributions made during the accounting
  period on which the report is based.
         Sec. 171.807.  DEPOSIT OF CERTAIN REVENUE. Notwithstanding
  any other law, for each fiscal year, the comptroller must deposit to
  the credit of the property tax relief fund an amount of revenue
  received from the tax imposed under this chapter sufficient to
  offset any decrease in deposits to that fund that results from the
  implementation of this subchapter.
         Sec. 171.808.  EXPIRATION.  This subchapter expires December
  31, 2021.
         SECTION 2.  (a)  Not later than September 1, 2022, the
  comptroller shall prepare and deliver to the governor, the
  lieutenant governor, the speaker of the house of representatives,
  and the presiding officer of each legislative standing committee
  with primary jurisdiction over taxation a report that evaluates the
  effect of the pilot program established under Subchapter P, Chapter
  171, Tax Code, as added by this Act, on employer contributions to
  employees' dependent care flexible spending accounts for which
  credits are granted under the pilot program under that subchapter.  
  The report must include a recommendation regarding whether the
  credit allowed under the pilot program should be reestablished.
         (b)  A taxable entity that claims a credit under Subchapter
  P, Chapter 171, Tax Code, as added by this Act, shall provide to the
  comptroller information the comptroller requests to prepare the
  report described by Subsection (a) of this section.
         SECTION 3.  A taxable entity may claim the credit under
  Subchapter P, Chapter 171, Tax Code, as added by this Act, only for
  contributions made on or after September 1, 2019, and before
  January 1, 2022, and only on a franchise tax report originally due
  under Chapter 171, Tax Code, on or after January 1, 2020, and before
  January 1, 2023, notwithstanding the expiration of Subchapter P,
  Chapter 171, Tax Code, as added by this Act.
         SECTION 4.  This Act takes effect September 1, 2019.
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