AN ACT
1-1 relating to a state tax refund and federal income tax credit
1-2 available to certain employers of AFDC recipients.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Subchapter D, Chapter 301, Labor Code, is amended
1-5 by adding Section 301.067 to read as follows:
1-6 Sec. 301.067. FEDERAL WORK OPPORTUNITY TAX CREDIT AND STATE
1-7 TAX REFUND FOR CERTAIN EMPLOYERS. (a) The commission is the lead
1-8 agency in promoting awareness of the federal work opportunity tax
1-9 credit program and the state tax refund for employers under
1-10 Subchapter H.
1-11 (b) The commission, in coordination with the comptroller's
1-12 office and the Texas Department of Human Services, shall develop
1-13 and distribute educational materials designed to increase awareness
1-14 of the tax credit and tax refund described by Subsection (a) to
1-15 encourage employers to hire recipients of the financial assistance
1-16 program for persons with dependent children under Chapter 31, Human
1-17 Resources Code.
1-18 SECTION 2. Subchapter D, Chapter 31, Human Resources Code,
1-19 is transferred to Chapter 301, Labor Code, redesignated as
1-20 Subchapter H, and amended to read as follows:
1-21 SUBCHAPTER H [D]. TAX REFUND FOR WAGES PAID
1-22 TO EMPLOYEE RECEIVING FINANCIAL ASSISTANCE
1-23 Sec. 301.101 [31.071]. DEFINITION. In this subchapter,
2-1 "wages" has the meaning assigned by Sections 51(c)(1), (2), and
2-2 (3), Internal Revenue Code of 1986 (26 U.S.C. Section 51).
2-3 Sec. 301.102 [31.072]. TAX REFUND VOUCHER. (a) The
2-4 commission [department] shall issue a tax refund voucher in the
2-5 amount allowed by this subchapter and subject to the restrictions
2-6 imposed by this subchapter to a person that meets the eligibility
2-7 requirements under this subchapter.
2-8 (b) A person issued a tax refund voucher may, subject to the
2-9 provisions of this subchapter, apply for the amount of the refund
2-10 of a tax that is paid by the person to this state if the tax is
2-11 administered by the comptroller and deposited to the credit of the
2-12 general revenue fund without dedication.
2-13 Sec. 301.103 [31.073]. AMOUNT OF REFUND; LIMITATION.
2-14 (a) The amount of the refund allowed under this subchapter is
2-15 equal to 20 percent of the total wages, up to a maximum of $10,000
2-16 in wages for each employee, paid or incurred by a person for
2-17 services rendered by an employee of the person during the period
2-18 beginning with the date the employee begins work for the person and
2-19 ending on the first anniversary of that date.
2-20 (b) The refund claimed for a calendar year may not exceed
2-21 the amount of net tax paid by the person to this state, after any
2-22 other applicable tax credits, in that calendar year.
2-23 Sec. 301.104 [31.074]. ELIGIBILITY. A person is eligible
2-24 for the refund for wages paid or incurred by the person, during
2-25 each calendar year for which the refund is claimed, only if:
3-1 (1) the wages paid or incurred by the person are for
3-2 services of an employee who is:
3-3 (A) a resident of this state; and
3-4 (B) a recipient of financial assistance and
3-5 services in accordance with Chapter 31, Human Resources Code [this
3-6 chapter];
3-7 (2) the person satisfies the certification
3-8 requirements under Section 301.105 [31.075]; and
3-9 (3) the person provides and pays for the benefit of
3-10 the employee a part of the cost of coverage under:
3-11 (A) a health plan provided by a health
3-12 maintenance organization established under the Texas Health
3-13 Maintenance Organization Act (Chapter 20A, Vernon's Texas Insurance
3-14 Code);
3-15 (B) a health benefit plan approved by the
3-16 commissioner of insurance; or
3-17 (C) a self-funded or self-insured employee
3-18 welfare benefit plan that provides health benefits and is
3-19 established in accordance with the Employee Retirement Income
3-20 Security Act of 1974 (29 U.S.C. 1001 et seq.) [at least 80 percent
3-21 of the cost of major medical health insurance coverage that
3-22 provides for:]
3-23 [(A) a maximum $300 deductible to the employee;
3-24 and]
3-25 [(B) payment by the insurance provider of at
4-1 least 70 percent of insurance claims during the claim year in
4-2 excess of the deductible].
4-3 Sec. 301.105 [31.075]. CERTIFICATION. A person is not
4-4 eligible for the refund for wages paid or incurred by the person
4-5 unless the person has received a written certification from the
4-6 commission [appropriate state agency responsible for certification]
4-7 that the employee is a recipient of financial assistance and
4-8 services on or before the day the employee begins employment with
4-9 the person.
4-10 Sec. 301.106 [31.076]. APPLICATION FOR REFUND; ISSUANCE.
4-11 (a) A person may apply for a tax refund voucher for wages paid an
4-12 employee in a calendar year only on or after January 1 and before
4-13 April 1 of the following calendar year.
4-14 (b) The commission [department] shall promulgate a form for
4-15 the application for the tax refund voucher. A person must use this
4-16 form in applying for the refund.
4-17 (c) On issuance of the tax refund voucher to the person by
4-18 the commission [department], the person may apply the voucher
4-19 against a tax paid by the person to this state only for the
4-20 calendar year for which the voucher is issued.
4-21 Sec. 301.107. RULES. (a) The commission shall adopt rules
4-22 as necessary to carry out its powers and duties under this
4-23 subchapter.
4-24 (b) The Texas Department of Human Services shall provide to
4-25 the commission information as necessary to enable the commission to
5-1 determine whether a person is eligible for the tax refund
5-2 authorized by this subchapter.
5-3 SECTION 3. Section 111.109, Tax Code, is amended to read as
5-4 follows:
5-5 Sec. 111.109. TAX REFUND FOR WAGES PAID TO EMPLOYEE
5-6 RECEIVING AID TO FAMILIES WITH DEPENDENT CHILDREN. The comptroller
5-7 shall issue a refund for a tax paid by a person to this state in
5-8 the amount of a tax refund voucher issued by the Texas Workforce
5-9 Commission [Department of Human Services] under Subchapter H [D],
5-10 Chapter 301 [31], Labor [Human Resources] Code, subject to the
5-11 provisions of that subchapter.
5-12 SECTION 4. (a) Except as provided by Subsection (b) of this
5-13 section, this Act takes effect September 1, 1997.
5-14 (b) The changes in law made by this Act to Section 301.104,
5-15 Labor Code, as added by this Act, take effect January 1, 1998. A
5-16 person may claim the refund under Section 301.104, Labor Code, as
5-17 added by this Act, only for wages paid or incurred on or after the
5-18 effective date of this Act and only on a tax report due on or after
5-19 that date.
5-20 (c) As soon as possible after the effective date of this
5-21 Act, the Texas Department of Human Services shall transfer to the
5-22 Texas Workforce Commission any forms in the custody of the
5-23 department that were prescribed by the department to issue a tax
5-24 refund voucher to eligible employers.
5-25 (d) Rules of the Texas Department of Human Services under
6-1 Subchapter D, Chapter 31, Human Resources Code, are continued in
6-2 effect as rules of the Texas Workforce Commission under Subchapter
6-3 H, Chapter 301, Labor Code, until superseded by a rule of the Texas
6-4 Workforce Commission.
6-5 SECTION 5. The importance of this legislation and the
6-6 crowded condition of the calendars in both houses create an
6-7 emergency and an imperative public necessity that the
6-8 constitutional rule requiring bills to be read on three several
6-9 days in each house be suspended, and this rule is hereby suspended.
_______________________________ _______________________________
President of the Senate Speaker of the House
I hereby certify that S.B. No. 1113 passed the Senate on
April 3, 1997, by the following vote: Yeas 31, Nays 0.
_______________________________
Secretary of the Senate
I hereby certify that S.B. No. 1113 passed the House on
May 7, 1997, by a non-record vote.
_______________________________
Chief Clerk of the House
Approved:
_______________________________
Date
_______________________________
Governor