1-1 By: Ellis, Zaffirini, West S.B. No. 1113
1-2 (In the Senate - Filed March 11, 1997; March 13, 1997, read
1-3 first time and referred to Committee on Health and Human Services;
1-4 March 26, 1997, reported favorably by the following vote: Yeas 11,
1-5 Nays 0; March 26, 1997, sent to printer.)
1-6 A BILL TO BE ENTITLED
1-7 AN ACT
1-8 relating to a state tax refund and federal income tax credit
1-9 available to certain employers of AFDC recipients.
1-10 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11 SECTION 1. Subchapter D, Chapter 301, Labor Code, is amended
1-12 by adding Section 301.067 to read as follows:
1-13 Sec. 301.067. FEDERAL WORK OPPORTUNITY TAX CREDIT AND STATE
1-14 TAX REFUND FOR CERTAIN EMPLOYERS. (a) The commission is the lead
1-15 agency in promoting awareness of the federal work opportunity tax
1-16 credit program and the state tax refund for employers under
1-17 Subchapter H.
1-18 (b) The commission, in coordination with the comptroller's
1-19 office and the Texas Department of Human Services, shall develop
1-20 and distribute educational materials designed to increase awareness
1-21 of the tax credit and tax refund described by Subsection (a) to
1-22 encourage employers to hire recipients of the financial assistance
1-23 program for persons with dependent children under Chapter 31, Human
1-24 Resources Code.
1-25 SECTION 2. Subchapter D, Chapter 31, Human Resources Code,
1-26 is transferred to Chapter 301, Labor Code, redesignated as
1-27 Subchapter H, and amended to read as follows:
1-28 SUBCHAPTER H [D]. TAX REFUND FOR WAGES PAID
1-29 TO EMPLOYEE RECEIVING FINANCIAL ASSISTANCE
1-30 Sec. 301.101 [31.071]. DEFINITION. In this subchapter,
1-31 "wages" has the meaning assigned by Sections 51(c)(1), (2), and
1-32 (3), Internal Revenue Code of 1986 (26 U.S.C. Section 51).
1-33 Sec. 301.102 [31.072]. TAX REFUND VOUCHER. (a) The
1-34 commission [department] shall issue a tax refund voucher in the
1-35 amount allowed by this subchapter and subject to the restrictions
1-36 imposed by this subchapter to a person that meets the eligibility
1-37 requirements under this subchapter.
1-38 (b) A person issued a tax refund voucher may, subject to the
1-39 provisions of this subchapter, apply for the amount of the refund
1-40 of a tax that is paid by the person to this state if the tax is
1-41 administered by the comptroller and deposited to the credit of the
1-42 general revenue fund without dedication.
1-43 Sec. 301.103 [31.073]. AMOUNT OF REFUND; LIMITATION.
1-44 (a) The amount of the refund allowed under this subchapter is
1-45 equal to 20 percent of the total wages, up to a maximum of $10,000
1-46 in wages for each employee, paid or incurred by a person for
1-47 services rendered by an employee of the person during the period
1-48 beginning with the date the employee begins work for the person and
1-49 ending on the first anniversary of that date.
1-50 (b) The refund claimed for a calendar year may not exceed
1-51 the amount of net tax paid by the person to this state, after any
1-52 other applicable tax credits, in that calendar year.
1-53 Sec. 301.104 [31.074]. ELIGIBILITY. A person is eligible
1-54 for the refund for wages paid or incurred by the person, during
1-55 each calendar year for which the refund is claimed, only if:
1-56 (1) the wages paid or incurred by the person are for
1-57 services of an employee who is:
1-58 (A) a resident of this state; and
1-59 (B) a recipient of financial assistance and
1-60 services in accordance with Chapter 31, Human Resources Code [this
1-61 chapter];
1-62 (2) the person satisfies the certification
1-63 requirements under Section 301.105 [31.075]; and
1-64 (3) the person provides and pays for the benefit of
2-1 the employee a part of the cost of coverage under:
2-2 (A) a health plan provided by a health
2-3 maintenance organization established under the Texas Health
2-4 Maintenance Organization Act (Chapter 20A, Vernon's Texas Insurance
2-5 Code);
2-6 (B) a health benefit plan approved by the
2-7 commissioner of insurance; or
2-8 (C) a self-funded or self-insured employee
2-9 welfare benefit plan that provides health benefits and is
2-10 established in accordance with the Employee Retirement Income
2-11 Security Act of 1974 (29 U.S.C. 1001 et seq.) [at least 80 percent
2-12 of the cost of major medical health insurance coverage that
2-13 provides for:]
2-14 [(A) a maximum $300 deductible to the employee;
2-15 and]
2-16 [(B) payment by the insurance provider of at
2-17 least 70 percent of insurance claims during the claim year in
2-18 excess of the deductible].
2-19 Sec. 301.105 [31.075]. CERTIFICATION. A person is not
2-20 eligible for the refund for wages paid or incurred by the person
2-21 unless the person has received a written certification from the
2-22 commission [appropriate state agency responsible for certification]
2-23 that the employee is a recipient of financial assistance and
2-24 services on or before the day the employee begins employment with
2-25 the person.
2-26 Sec. 301.106 [31.076]. APPLICATION FOR REFUND; ISSUANCE.
2-27 (a) A person may apply for a tax refund voucher for wages paid an
2-28 employee in a calendar year only on or after January 1 and before
2-29 April 1 of the following calendar year.
2-30 (b) The commission [department] shall promulgate a form for
2-31 the application for the tax refund voucher. A person must use this
2-32 form in applying for the refund.
2-33 (c) On issuance of the tax refund voucher to the person by
2-34 the commission [department], the person may apply the voucher
2-35 against a tax paid by the person to this state only for the
2-36 calendar year for which the voucher is issued.
2-37 Sec. 301.107. RULES. (a) The commission shall adopt rules
2-38 as necessary to carry out its powers and duties under this
2-39 subchapter.
2-40 (b) The Texas Department of Human Services shall provide to
2-41 the commission information as necessary to enable the commission to
2-42 determine whether a person is eligible for the tax refund
2-43 authorized by this subchapter.
2-44 SECTION 3. Section 111.109, Tax Code, is amended to read as
2-45 follows:
2-46 Sec. 111.109. TAX REFUND FOR WAGES PAID TO EMPLOYEE
2-47 RECEIVING AID TO FAMILIES WITH DEPENDENT CHILDREN. The comptroller
2-48 shall issue a refund for a tax paid by a person to this state in
2-49 the amount of a tax refund voucher issued by the Texas Workforce
2-50 Commission [Department of Human Services] under Subchapter H [D],
2-51 Chapter 301 [31], Labor [Human Resources] Code, subject to the
2-52 provisions of that subchapter.
2-53 SECTION 4. (a) Except as provided by Subsection (b) of this
2-54 section, this Act takes effect September 1, 1997.
2-55 (b) The changes in law made by this Act to Section 301.104,
2-56 Labor Code, as added by this Act, take effect January 1, 1998. A
2-57 person may claim the refund under Section 301.104, Labor Code, as
2-58 added by this Act, only for wages paid or incurred on or after the
2-59 effective date of this Act and only on a tax report due on or after
2-60 that date.
2-61 (c) As soon as possible after the effective date of this
2-62 Act, the Texas Department of Human Services shall transfer to the
2-63 Texas Workforce Commission any forms in the custody of the
2-64 department that were prescribed by the department to issue a tax
2-65 refund voucher to eligible employers.
2-66 (d) Rules of the Texas Department of Human Services under
2-67 Subchapter D, Chapter 31, Human Resources Code, are continued in
2-68 effect as rules of the Texas Workforce Commission under Subchapter
2-69 H, Chapter 301, Labor Code, until superseded by a rule of the Texas
3-1 Workforce Commission.
3-2 SECTION 5. The importance of this legislation and the
3-3 crowded condition of the calendars in both houses create an
3-4 emergency and an imperative public necessity that the
3-5 constitutional rule requiring bills to be read on three several
3-6 days in each house be suspended, and this rule is hereby suspended.
3-7 * * * * *