75R7051 CBH-D By Shields H.B. No. 760 Substitute the following for H.B. No. 760: By Craddick C.S.H.B. No. 760 A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to a franchise tax credit for contributions made to 1-3 medical savings accounts. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Chapter 171, Tax Code, is amended by adding 1-6 Subchapter N to read as follows: 1-7 SUBCHAPTER N. TAX CREDIT FOR CONTRIBUTIONS TO 1-8 MEDICAL SAVINGS ACCOUNT 1-9 Sec. 171.701. DEFINITION. In this subchapter, "medical 1-10 savings account" has the meaning assigned by 26 U.S.C.A. Section 1-11 220(d)(1). 1-12 Sec. 171.702. CREDIT. A corporation that meets the 1-13 eligibility requirements under this subchapter is entitled to a 1-14 credit in the amount allowed under this subchapter against the tax 1-15 imposed under this chapter. 1-16 Sec. 171.703. CREDIT FOR CONTRIBUTIONS TO MEDICAL SAVINGS 1-17 ACCOUNT. (a) A corporation is eligible for a credit under this 1-18 subchapter only if the corporation: 1-19 (1) did not offer a health benefit plan to its 1-20 employees on or after January 1, 1997; 1-21 (2) made a contribution to a medical savings account 1-22 for an employee during the reporting period; and 1-23 (3) employed an average of 50 or fewer employees 1-24 during the reporting period. 2-1 (b) The amount of the credit is equal to 50 percent of the 2-2 total amount the employer contributed to medical savings accounts 2-3 for employees during the reporting period. 2-4 Sec. 171.704. APPLICATION FOR CREDIT. (a) A corporation 2-5 must apply for a credit under this subchapter on or with the tax 2-6 report for the period for which the credit is claimed. 2-7 (b) The corporation shall adopt a form for the application 2-8 for the credit. A corporation must use this form in applying for 2-9 the credit. 2-10 Sec. 171.705. PERIOD FOR WHICH CREDIT MAY BE CLAIMED. (a) 2-11 Except as provided by Subsection (b), a corporation may claim a 2-12 credit under this subchapter for contributions made during an 2-13 accounting period only against the tax owed for the corresponding 2-14 reporting period. 2-15 (b) A corporation may not claim a credit in an amount that 2-16 exceeds the amount of the tax due for the report. A corporation 2-17 shall apply unused credit each reporting period toward the tax due 2-18 under this chapter until the credit is used. 2-19 Sec. 171.706. ASSIGNMENT PROHIBITED. A corporation may not 2-20 convey, assign, or transfer the credit allowed under this 2-21 subchapter to another entity unless all of the assets of the 2-22 corporation are conveyed, assigned, or transferred in the same 2-23 transaction. 2-24 SECTION 2. This Act applies to reports originally due on or 2-25 after January 1, 2000. 2-26 SECTION 3. The importance of this legislation and the 2-27 crowded condition of the calendars in both houses create an 3-1 emergency and an imperative public necessity that the 3-2 constitutional rule requiring bills to be read on three several 3-3 days in each house be suspended, and this rule is hereby suspended.