By:  Turner                                           S.B. No. 1187
                                 A BILL TO BE ENTITLED
                                        AN ACT
    1-1  relating to the apportionment of taxable capital and taxable earned
    1-2  surplus to the state.
    1-4        SECTION 1.  Subchapter C, Chapter 171.106, Tax Code, is
    1-5  amended by adding Subsection (d) to read as follows:
    1-6        (d)  A corporation's taxable capital or earned surplus that
    1-7  is derived, directly or indirectly, from the sale of management,
    1-8  administration or investment services to an employee retirement
    1-9  plan is apportioned to this state to determine the amount of the
   1-10  tax imposed under Section 171.002 by multiplying the corporation's
   1-11  total taxable capital or earned surplus from the sale of services
   1-12  to an employee retirement plan company by a fraction, the numerator
   1-13  of which is the average of the sum of beneficiaries domiciled in
   1-14  Texas at the beginning of the year and the sum of beneficiaries
   1-15  domiciled in Texas at the end of the year, and the denominator of
   1-16  which is the average of the sum of all beneficiaries at the
   1-17  beginning of the year and the sum of all beneficiaries at the end
   1-18  of the year.  The corporation shall make a separate computation to
   1-19  allocate taxable capital and earned surplus.  In this subsection,
   1-20  "employee retirement plan" means a plan or other arrangement that
   1-21  is qualified under Section 401(a) of the Internal Revenue Code or
   1-22  satisfies the requirements of Section 403 of the Internal Revenue
   1-23  Code or a government plan described in Section 414(d) of the
    2-1  Internal Revenue Code, but does not include an individual
    2-2  retirement account or individual retirement annuity within the
    2-3  meaning of Section 408 of the Internal Revenue Code.
    2-4        SECTION 2.  This Act takes effect September 1, 1995.
    2-5        SECTION 3.  The importance of this legislation and the
    2-6  crowded condition of the calendars in both houses create an
    2-7  emergency and an imperative public necessity that the
    2-8  constitutional rule requiring bills to be read on three several
    2-9  days in each house be suspended, and this rule is hereby suspended.