By Horn                                               H.B. No. 2236
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to the apportionment of taxable capital and taxable earned
    1-3  surplus to the state.
    1-4        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-5        SECTION 1.  Subchapter C, Chapter 171.106, Tax Code, is
    1-6  amended by adding Subsection (d) to read as follows:
    1-7        (d)  A corporation's taxable capital or earned surplus that
    1-8  is derived, directly or indirectly, from the sale of management,
    1-9  administration or investment services to an employee retirement
   1-10  plan is apportioned to this state to determine the amount of the
   1-11  tax imposed under Section 171.002 by multiplying the corporation's
   1-12  total taxable capital or earned surplus from the sale of services
   1-13  to an employee retirement plan company by a fraction, the numerator
   1-14  of  which is the average of the sum of beneficiaries domiciled in
   1-15  Texas at the beginning of the year and the sum of beneficiaries
   1-16  domiciled in Texas at the end of the year, and the denominator of
   1-17  which is the average of the sum of all beneficiaries at the
   1-18  beginning of the year and the sum of all beneficiaries at the end
   1-19  of the year.  The corporation shall make a separate computation to
   1-20  allocate taxable capital and earned surplus.  In this subsection,
   1-21  "employee retirement plan" means a plan or other arrangement that
   1-22  is qualified under Section 401(a) of the Internal Revenue Code or
   1-23  satisfies the requirements of Section 403 of the Internal Revenue
    2-1  Code or a government plan described in Section 414(d) of the
    2-2  Internal Revenue Code, but does not include an individual
    2-3  retirement account or individual retirement annuity within the
    2-4  meaning of Section 408 of the Internal Revenue Code.
    2-5        SECTION 2.  This Act takes effect September 1, 1995.
    2-6        SECTION 3.  The importance of this legislation and the
    2-7  crowded condition of the calendars in both houses create an
    2-8  emergency and an imperative public necessity that the
    2-9  constitutional rule requiring bills to be read on three several
   2-10  days in each house by suspended, and this rule is hereby suspended.