SRC-TBR S.B. 63 77(R)   BILL ANALYSIS


Senate Research Center   S.B. 63
77R1521 DAK-DBy: Moncrief
Business & Commerce
3/13/2001
As Filed


DIGEST AND PURPOSE 

Currently, federal law allows businesses that hire qualified disabled
workers to apply for a federal work opportunity tax credit.  As proposed,
S.B. 63 allows corporations to claim a franchise tax credit for ten percent
of the wages paid to a disabled employee for a period of two years, and
sets forth conditions of the employees employment. 

RULEMAKING AUTHORITY

Rulemaking authority is expressly granted to the comptroller of public
accounts in SECTION 1 (Section 171.856 Tax code) of this bill. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Chapter 171, Tax Code, is amending by adding Subchapter
S, as follows: 

SUBCHAPTER S.  TAX CREDIT FOR WAGES PAID TO PERSONS WITH CERTAIN
DISABILITIES. 

Sec. 171.851.  ENTITLEMENT TO CREDIT.  Entitles a corporation to a credit
in the amount and under the conditions and limitations provided by this
subchapter against the tax imposed under this chapter. 

Sec. 171.852.  QUALIFICATION.  Provides that a corporation qualifies for a
credit under this subchapter for each employee: 
  _ originally hired on or after January 1, 2002;
_ who, at the time of being hired, is an individual eligible under 42
U.S.C. Section 1382 (Eligibility of Benefits), as amended, for supplemental
security income benefits on the basis of disability or blindness or is a
recipient of social security disability insurance benefits; and  
  _ who meets certain conditions.

Sec. 171.853.  AMOUNT; LIMITATIONS.   Provides the amount of the credit is
10 percent of the wages paid by the corporation for each qualified
employee.   Authorizes a corporation to claim the credit only for wages
paid the qualified employee during the first two years of employment.
Prohibits the credit claimed for each privilege period from exceeding 50
percent of the amount of net franchise tax due, after any other applicable
credits, for the privilege period. 

Sec. 171.854.  APPLICATION FOR CREDIT.  Requires that a corporation apply
for a credit under this subchapter on or with the tax report for the period
for which the credit is claimed.  Requires the comptroller to promulgate a
form for the application for the credit. Requires the corporation to use
the form in applying for the credit. 

Sec. 171.855.  PERIOD FOR WHICH CREDIT MAY BE CLAIMED.  Authorizes a
corporation to claim a credit under this subchapter for wages paid during
an accounting period only against the tax owed for the corresponding
privilege period. 

Sec. 171.856.  RULES.  Requires the comptroller to adopt rules necessary to
implement this subchapter. 

Section 2.  Effective date: January 1, 2002.
       Makes application of this Act prospective.