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A BILL TO BE ENTITLED
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AN ACT
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relating to a franchise tax credit for taxable entities that |
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provide child care. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 171, Tax Code, is amended by adding |
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Subchapter N to read as follows: |
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SUBCHAPTER N. TAX CREDIT FOR PROVISION OF CHILD CARE |
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Sec. 171.701. DEFINITION. In this subchapter, "employee" |
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means an individual who performs services for an employer for |
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compensation under an oral or written contract of hire, whether |
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express or implied. The term does not include an independent |
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contractor. |
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Sec. 171.702. ENTITLEMENT TO CREDIT. A taxable entity is |
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entitled to a credit in the amount and under the conditions provided |
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by this subchapter against the tax imposed under this chapter. |
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Sec. 171.703. QUALIFICATION. A taxable entity qualifies |
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for a credit under this subchapter if the taxable entity subsidizes |
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all or a portion of the entity's employees' costs for child care at: |
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(1) a licensed child-care center operated by the |
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entity; or |
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(2) a licensed commercial or home-based child-care |
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center. |
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Sec. 171.704. AMOUNT OF CREDIT. The amount of a taxable |
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entity's credit for a report is equal to the lesser of: |
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(1) the amount of the costs attributable to |
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subsidizing employee child care in the manner described by Section |
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171.703 during the period on which the report is based; or |
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(2) the amount equal to one percent of the franchise |
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tax due for the report after applying all other applicable credits. |
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Sec. 171.705. APPLICATION FOR CREDIT. (a) A taxable entity |
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must apply for a credit under this subchapter on or with the report |
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for which the credit is claimed. |
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(b) The comptroller shall prescribe the form and method of |
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applying for a credit under this section. A taxable entity must use |
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the form and method prescribed by the comptroller to apply for the |
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credit. |
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(c) The comptroller may require a taxable entity to submit |
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with an application any information the comptroller determines is |
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necessary to determine whether the taxable entity meets the |
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requirements of Section 171.703. |
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Sec. 171.706. ASSIGNMENT PROHIBITED; EXEMPTION. A taxable |
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entity may not convey, assign, or transfer the credit allowed under |
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this subchapter to another taxable entity unless substantially all |
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of the assets of the taxable entity are conveyed, assigned, or |
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transferred in the same transaction. |
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Sec. 171.707. RULES. The comptroller shall adopt rules |
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necessary to implement and administer this subchapter. |
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SECTION 2. This Act applies only to a report originally due |
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on or after the effective date of this Act. |
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SECTION 3. This Act takes effect January 1, 2024. |