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A BILL TO BE ENTITLED
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AN ACT
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relating to qualification for the exemption from ad valorem |
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taxation for property of certain charitable or religious |
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organizations. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 11.184, Tax Code, is amended by adding |
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Subsections (l), (m), and (n) to read as follows: |
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(l) Notwithstanding the other provisions of this section, |
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if the exemption authorized by this section is approved under |
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Subsection (b), a corporation that is not a qualified charitable |
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organization is entitled to an exemption from taxation of property |
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under this section if: |
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(1) the corporation is exempt from federal income |
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taxation under Section 501(a), Internal Revenue Code of 1986, by |
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being listed as an exempt entity under Section 501(c)(2) of that |
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code; |
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(2) the corporation holds title to the property for, |
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collects income from the property for, and turns over the entire |
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amount of that income, less expenses, to a qualified charitable |
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organization; and |
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(3) the qualified charitable organization would |
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qualify for an exemption from taxation of the property under this |
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section if the qualified charitable organization owned the |
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property. |
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(m) Before a corporation described by Subsection (l) may |
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submit an application for an exemption under this section, the |
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qualified charitable organization for which the corporation holds |
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title to the property must apply to the comptroller for the |
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determination described by Subsection (e) with regard to the |
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qualified charitable organization. The application for the |
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determination must also include an application to the comptroller |
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for a determination of whether the corporation meets the |
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requirements of Subsections (l)(1) and (2). The corporation shall |
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submit with the application for an exemption under this section a |
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copy of the determination letter issued by the comptroller. The |
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chief appraiser shall accept the copy of the letter as conclusive |
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evidence of the matters described by Subsection (h) as well as of |
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whether the corporation meets the requirements of Subsections |
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(l)(1) and (2). |
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(n) Notwithstanding Subsection (k), in order for a |
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corporation to continue to receive an exemption under Subsection |
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(l) after the fifth tax year after the year in which the exemption |
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is granted, the qualified charitable organization for which the |
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corporation holds title to property must obtain a new determination |
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letter and the corporation must reapply for the exemption. |
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SECTION 2. Section 11.20(j), Tax Code, is amended to read as |
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follows: |
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(j) A tract of land that is contiguous to the tract of land |
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on which the religious organization's place of regular religious |
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worship is located may not be exempted under Subsection (a)(6) for |
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more than 15 [six] years if the tract of land does not exceed three |
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acres or for more than 10 years if the tract of land exceeds three |
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acres. A tract of land that is not contiguous to the tract of land |
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on which the religious organization's place of regular religious |
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worship is located may not be exempted under Subsection (a)(6) for |
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more than five [three] years. For purposes of this subsection, a |
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tract of land is considered to be contiguous with another tract of |
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land if the tracts are divided only by a road, railroad track, |
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river, or stream. |
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SECTION 3. Sections 11.201(a) and (e), Tax Code, are |
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amended to read as follows: |
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(a) If land is sold or otherwise transferred to another |
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person in a year in which the land receives an exemption under |
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Section 11.20(a)(6), an additional tax is imposed on the land equal |
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to the tax that would have been imposed on the land had the land been |
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taxed for each of the seven [five] years preceding the year in which |
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the sale or transfer occurs in which the land received an exemption |
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under that subsection, plus interest at an annual rate of seven |
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percent calculated from the dates on which the taxes would have |
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become due. |
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(e) The sanctions provided by Subsection (a) do not apply if |
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the sale or transfer occurs as a result of: |
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(1) a sale for right-of-way; |
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(2) a condemnation; |
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(3) a transfer of property to the state or a political |
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subdivision of the state to be used for a public purpose; [or] |
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(4) a transfer of property to a religious organization |
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that qualifies the property for an exemption under Section 11.20 |
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for the tax year in which the transfer occurs; or |
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(5) a transfer of property to an educational, |
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religious, charitable, or other similar organization that is |
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qualified as a charitable organization under Section 501(c)(3), |
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Internal Revenue Code of 1986. |
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SECTION 4. This Act applies only to ad valorem taxes imposed |
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for a tax year beginning on or after the effective date of this Act. |
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SECTION 5. This Act takes effect January 1, 2008. |