By: Ratliff S.B. No. 1321
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the settlement and collection of taxes and penalties
1-2 and interest on taxes, refunds, and credits.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 111.060, Tax Code, is amended to read as
1-5 follows:
1-6 Sec. 111.060. INTEREST ON DELINQUENT TAX. (a) The yearly
1-7 interest rate on all delinquent taxes imposed by this title is at
1-8 the rate of 12 percent for report periods originally due on or
1-9 before December 31, 1999, after which the rate of interest is
1-10 variable and determined as provided in Subsection (b).
1-11 (b) The rate of interest to be charged to the taxpayer is
1-12 the prime rate plus one percent, as published in The Wall Street
1-13 Journal on the first day of each calendar year that is not a
1-14 Saturday, Sunday, or legal holiday.
1-15 (c) Except as provided by Subsection (d) [(c) of this
1-16 section], delinquent taxes draw interest beginning 60 days after
1-17 [from] the date due.
1-18 (d) [(c)] Subsection (c) [(b) of this section] does not
1-19 apply to the taxes imposed by Chapters 152 and 211 [of this code]
1-20 or under an agreement made under Section 153.017 [of this code].
1-21 SECTION 2. Subchapter B, Chapter 111, Tax Code, is amended
1-22 by adding Section 111.064 to read as follows:
1-23 Sec. 111.064. INTEREST ON REFUND OR CREDIT. (a) Except as
1-24 provided by Subsections (b) and (c), in a comptroller's final
2-1 decision on a claim for refund or in an audit, interest is at the
2-2 rate set in Section 111.060 on the amount found to be erroneously
2-3 paid for a period:
2-4 (1) beginning on the later of 60 days after the date
2-5 of payment or the due date of the tax report; and
2-6 (2) ending on, as determined by the comptroller,
2-7 either the date of allowance of credit on account of the
2-8 comptroller's final decision or audit or a date not more than 10
2-9 days before the date of the refund warrant.
2-10 (b) A credit taken by a taxpayer on the taxpayer's return
2-11 does not accrue interest.
2-12 (c) For a refund granted for a report period due on or after
2-13 January 1, 2000, the rate of interest is the rate set in Section
2-14 111.060. A refund for a report period due before January 1, 2000,
2-15 does not accrue interest.
2-16 (d) This section does not apply to an amount paid to the
2-17 comptroller under Title 6, Property Code, or under an agreement
2-18 made under Section 153.017.
2-19 (e) All warrants for interest payments shall be drawn
2-20 against the fund or account into which the erroneously paid tax was
2-21 deposited. The interest shall be paid from funds appropriated for
2-22 that purpose.
2-23 SECTION 3. Section 111.101, Tax Code, is amended to read as
2-24 follows:
2-25 Sec. 111.101. SETTLEMENT [BEFORE REDETERMINATION]. (a) The
2-26 [After the comptroller examines a taxpayer's records and before a
3-1 petition for redetermination of the tax is filed, the] comptroller
3-2 may settle a claim for a tax, penalty, or interest imposed by this
3-3 title if the total costs [cost] of collection, as conclusively
3-4 determined by the comptroller, of the total amount due would exceed
3-5 the total amount [of tax] due [and if the amount due is not more
3-6 than $300].
3-7 (b) The comptroller may settle a claim for a refund of tax,
3-8 penalty, or interest imposed by this title if the total costs of
3-9 defending a denial of the claim, as conclusively determined by the
3-10 comptroller, would exceed the total amount claimed.
3-11 SECTION 4. Section 111.102, Tax Code, is amended to read as
3-12 follows:
3-13 Sec. 111.102. SETTLEMENT ON REDETERMINATION. As a part of a
3-14 redetermination order, the comptroller may settle a claim for a
3-15 tax, penalty, or interest imposed by this title if:
3-16 (1) [the cost of collection of the amount of tax due
3-17 would exceed the amount of tax due and the amount of tax due is not
3-18 more than $1,000;]
3-19 [(2)] collection of the total amount [of tax] due
3-20 would make the taxpayer insolvent and the taxpayer has submitted to
3-21 the comptroller all financial records, including income tax reports
3-22 and an inventory of all property owned wherever located; or
3-23 (2) [(3)] the taxpayer is insolvent, is in
3-24 liquidation, or has ceased to do business and:
3-25 (A) the taxpayer has no property that may be
3-26 seized by the courts of this or another state; or
4-1 (B) the value of the taxpayer's property is less
4-2 than the total amount [of tax] due and the amount of debts against
4-3 the property.
4-4 SECTION 5. The comptroller of public accounts may adopt
4-5 rules and take other actions before January 1, 2000, as the
4-6 comptroller considers necessary or advisable to prepare for
4-7 Sections 3 and 4 of this Act taking effect.
4-8 SECTION 6. (a) Sections 3, 4, and 5 of this Act take effect
4-9 on the first date on which they may take effect under Section 39,
4-10 Article III, Texas Constitution.
4-11 (b) Sections 1 and 2 of this Act take effect January 1,
4-12 2000.
4-13 SECTION 7. The importance of this legislation and the
4-14 crowded condition of the calendars in both houses create an
4-15 emergency and an imperative public necessity that the
4-16 constitutional rule requiring bills to be read on three several
4-17 days in each house be suspended, and this rule is hereby suspended,
4-18 and that this Act take effect and be in force according to its
4-19 terms, and it is so enacted.