Amend the Hilderbran amendment (on page 222 of the packet) to
read as follows:
Amend CSHB 4 as follows:
(1) On page 148, strike lines 17-27, and on page 149, strike
lines 1-6, and substitute the following:
(5)(a) "Compensation" means amounts paid to or for the
benefit of an employee, officer, director, or owner and that:
(i) are subject to withholding under the
Internal Revenue Code; or
(ii) with respect to compensation paid to an
officer, director or owner would be subject to withholding if the
officer, director, or owner were considered an employee and the
amounts paid were considered salaries.
(b) For a taxable entity other than a corporation,
compensation includes net earnings from self-employment, as defined
in Section 1402(b), Internal Revenue Code, but does not include
guaranteed payments to owners for the use of capital, as defined in
707(c), Internal Revenue Code.
(6) "Employee" means an employee as defined in Section
3401(c), Internal Revenue Code. A person from whom an employer is
required to withhold for federal income tax purposes is presumed to
be an employee.
(2) On page 151, strike lines 23-24, and substitute the
following:
(G) a partnership that is required to file a federal
tax return as a corporation or a partnership, other than an oil and
gas joint operating agreement.
(3) On page 162, strike lines 1-27, and on page 163, strike
lines 1-2.
(4) On page 164, strike lines 1-27, and on page 165, strike
lines 1-10, and substitute the following:
this state include only the gain from the sale. A taxable
entity <corporation> shall deduct from its gross receipts computed
under Subsection (a) any amount to the extent included under
subsection (a) because of the application of Section 78 or Sections
951-964, Internal Revenue Code, and dividends received from a
subsidiary, associate, or affiliated corporation that does not
transact a substantial portion of its business or regularly
maintain a substantial portion of its assets in the United States.
(5) On page 166, stike lines 16-22, and substitute the
following:
(c) A taxable entity<corporation> shall deduct from
its gross receipts computed under Subsection (a) any amount to the
extent included in Subsection (a) because of the application of
Section 78 or Sections 951-964, Internal Revenue Code, and
dividends received from a subsidiary, associate, or affiliated
corporation that does not transact a substantial portion of its
business or regularly maintain a substantial portion of its assets
in the United States.
(6) On page 167, strike lines 19-27, and on page 168, strike
lines 1-11, and substitute with the following:
(c) A taxable entity's <corporation's> capital or
earned surplus that is derived, directly or indirectly, from the
sale of management, distribution, or administration services to or
on behalf of a regulated investment company, including a taxable
entity <corporation> that includes trustees or sponsors of employee
benefit plans that have accounts in a regulated investment company,
is apportioned to this state to determine the amount of the tax
imposed under Section 171.002 by multiplying the taxable entity's
<corporation's> total taxable capital or earned surplus from the
sale of services to or on behalf of a regulated investment company
by a fraction, the numerator of which is the average of the sum of
shares owned at the beginning of the year and the sum of shares
owned at the end of the year by the investment company shareholders
who are commercially domiciled in this state, and the denominator
of which is the average of the sum of shares owned at the beginning
of the year and the sum of shares owned at the end of the year by
all investment company shareholders. The taxable entity
<corporation> shall make a separate computation to allocate taxable
capital and earned surplus. In this subsection, "regulated
investment company" has the meaning assigned by Section 851(a)
Internal Revenue Code.
(7) On page 170, strike lines 16-17, and substitute the
following:
(e) Unless the provisions of the Section 171.111 apply
due to an election under that section, a taxable entity
<corporation>
(8) On page 172, strike lines 22-23, and substitute the
following:
The net taxable earned surplus of a taxable entity
<corporation> is computed by:
(9) On page 173, strike lines 3-8, and substitute the
following:
(B) subtracting any taxable income or deductions
included under the provisions of the Internal Revenue Code, to the
extent included in computing federal taxable income from any
taxable entity that is subject to the earned surplus component of
the tax imposed under this chapter;
(10) On page 173, strike lines 19-27, and on page 174, strike
lines 1-7, and substitute the following:
(E) adding 22 percent of compensation, to the extent
excluded in determining reportable federal taxable income, of:
(i) each employee,
(ii) each officer, except if a bank, only each
executive officer;
(iii) each director;
(iv) each owner who owns 0.01 percent or more of
the taxable entity;
(F) for a taxable entity with 35 or fewer owners,
directly or indirectly, subtracting an amount up to $100,000 in
compensation paid to each owner who owns 0.1 percent or more of the
taxable entity; and
(G) adding 100 percent of guaranteed payments, to the
extent excluded in determining reportable federal taxable income,
made to each partner.
(11) On page 174, strike lines 12-17, and substitute the
following:
(3) adding the taxable entity's <corporation's> taxable
earned surplus allocated to this state as provided by Section
171.1061;
(4) subtracting a $500,000 standard deduction, and
(5) subtracting any allowable deductions and any
business loss that is carried forward to the tax reporting period
and deductible under Subsection (e).
(12) On page 175, strike line 23, and substitute the
following:
negative amount after apportionment and allocation, but does not
include any amounts attributable to the $500,000 standard deduction
provided for in section 171.110. The business
(13) On page 176, strike lines 19-27, and on page 177, strike
lines 1-27, and on page 178, strike lines 1-10.
(14) On page 214, beginning on line 5, strike ARTICLE 4.
SALES TAX in its entirety.
(15) On page 275, beginning on line 15, strike ARTICLE 5.
INSURANCE PREMIUM TAXES in its entirety.
(16) On page 287, beginning on line 23, strike ARTICLE 6.
LOTTERY REVENUE in its entirety.
(17) On page 291, beginning on line 15, strike ARTICLE 7.
ALCOHOLIC BEVERAGE TAXES in its entirety.
(18) On page 293, beginning on line 5, strike ARTICLE 8.
MOTOR FUEL AND AVIATION FUEL TAXES in its entirety.
(19) On page 359, beginning on line 26, strike ARTICLE 9.
OCCUPANCY TAX in its entirety.
(20) On page 360, beginning on line 11, strike ARTICLE 10.
CIGARETTE AND TOBACCO PRODUCTS TAX in its entirety.
(21) On page 361, beginning on line 24, strike ARTICLE 11.
MANUFACTURED HOUSING SALES AND USE TAX in its entirety.
(22) On page 362, beginning on line 5, strike ARTICLE 12.
GAS, ELECTRIC, AND WATER SERVICE TAX in its entirety.
(23) On page 364, beginning on line 20, strike ARTICLE 13.
INTERSTATE MOTOR CARRIER SALES AND USE TAX in its entirety.
(24) On page 373, beginning on line 1, strike ARTICLE 14.
CEMENT PRODUCTION TAX in its entirety.
(25) On page 373, beginning on line 12, strike ARTICLE 15.
COAL AND LIGNITE USE TAX in its entirety.
(26) On page 376, beginning on line 3, strike ARTICLE 16.
PARI-MUTUEL WAGERING in its entirety.
(27) On page 378, beginning on line 22, strike ARTICLE 17.
GAS TARIFFS in its entirety.
(28) On page 380, beginning on line 1, strike ARTICLE 18.
INTERIOR DESIGN PROFESSIONAL FEE in its entirety.
(29) On page 380, beginning on line 20, strike ARTICLE 19.
TAXI CAB PERMITS in its entirety.
(30) On page 386, beginning on line 3, strike ARTICLE 20.
COIN OPERATED MACHINES in its entirety.