By Gutierrez                                          H.B. No. 3520
         Line and page numbers may not match official copy.
         Bill not drafted by TLC or Senate E&E.
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to a franchise tax credit for expenditures made toward the
 1-3     cost of nursing education.
 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 S to read as follows:
 1-7      SUBCHAPTER S.  TAX CREDIT FOR EXPENDITURES FOR NURSING EDUCATION
 1-8           Sec. 171.851.  DEFINITION: In the subchapter, "nursing
 1-9     education" means the education of students in:
1-10                 (1)  a nursing program preparing individuals for
1-11     initial licensure as a registered nurse; or
1-12                 (2)  a masters or doctoral program who intends to teach
1-13     in a nursing program preparing students for initial licensure as
1-14     registered nurses.
1-15           Sec. 171.852.  ELIGIBILITY. A corporation is eligible for a
1-16     credit against the tax imposed under this chapter in the amount and
1-17     under the conditions and limitations provided by this subchapter.
1-18           Sec. 171.853.  CREDIT FOR COST OF EDUCATION OF REGISTERED
1-19     NURSE STUDENTS. (a)  A corporation may claim a credit under this
1-20     subchapter only for an expenditure made toward the cost of nursing
1-21     education.
1-22           (b)  A corporation may claim a credit under this subchapter
1-23     regardless of whether the corporation:
 2-1                 (1)  provides or pays for the education directly; or
 2-2                 (2)  donates money to a nursing school or program that
 2-3     uses the money only to provide or pay for nursing education.
 2-4           Sec. 171.854.  LIMITATIONS. (a)  The total credit under this
 2-5     subchapter for a report may not exceed 20 percent of the amount of
 2-6     net franchise tax due for the privilege period after any other
 2-7     applicable tax credits.
 2-8           (b)  A corporation may claim a credit under this subchapter
 2-9     for an expenditure made during an accounting period only against
2-10     the tax owed for the corresponding reporting period.
2-11           Sec. 171.855.  APPLICATION FOR CREDIT. (a)  A corporation
2-12     must apply for a credit under this subchapter on or with the tax
2-13     report for the period for which the credit is claimed.
2-14           (b)  The comptroller shall adopt a form for the application
2-15     for the credit.  A corporation must use this form in applying for
2-16     the credit.
2-17           Sec. 171.856.  ASSIGNMENT PROHIBITED. A corporation may not
2-18     convey, assign, or transfer the credit allowed under this
2-19     subchapter to another entity unless all of the assets of the
2-20     corporation are conveyed, assigned, or transferred in the same
2-21     transaction.
2-22           SECTION 2. (a)  This Act takes effect January 1, 2002, and
2-23     applies only to a report due on or after that date.
2-24           (b)  A corporation may claim a credit under Subchapter S,
2-25     Chapter 171, Tax Code, as added by this Act, only for an
2-26     expenditure made on or after January 1, 2002.