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A BILL TO BE ENTITLED
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AN ACT
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relating to an exemption from ad valorem taxation for property of |
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certain fraternal organizations. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Sections 11.18(g) and (h), Tax Code, are amended |
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to read as follows: |
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(g) A charitable organization that performs a charitable |
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function specified by Subsection (d)(15) must: |
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(1) be affiliated with a state or national |
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organization that authorizes, approves, or sanctions volunteer |
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charitable fundraising organizations; |
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(2) qualify for exemption under Section 501(c)(3) or |
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(8), Internal Revenue Code of 1986, as amended; |
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(3) be governed by a volunteer board of directors; and |
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(4) distribute contributions to at least five other |
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associations to be used for general charitable purposes, with all |
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recipients meeting the following criteria: |
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(A) be governed by a volunteer board of |
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directors; |
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(B) qualify for exemption under Section |
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501(c)(3) or (8), Internal Revenue Code of 1986, as amended; |
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(C) receive a majority of annual revenue from |
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private or corporate charitable gifts and government agencies; and |
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(D) provide services without regard to the |
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ability of persons receiving the services to pay for the services. |
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(h) Performance of noncharitable functions by a charitable |
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organization that owns or uses exempt property does not result in |
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loss of an exemption authorized by this section if those other |
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functions are incidental to the organization's charitable |
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functions. The division of responsibilities between an |
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organization that qualifies as a charitable organization under |
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Subsection (c) and another organization will not disqualify the |
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organizations or any property owned or used by either organization |
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from receiving an exemption under this section if the collaboration |
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furthers the provision of one or more of the charitable functions |
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described in Subsection (d) and if the other organization: |
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(1) is exempt from federal income taxation under |
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Section 501(a), Internal Revenue Code of 1986, as an organization |
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described by Section 501(c)(3) or (8) of that code; |
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(2) meets the criteria for a charitable organization |
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under Subsections (e) and (f); and |
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(3) is under common control with the charitable |
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organization described in this subsection. |
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SECTION 2. 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 3. This Act takes effect January 1, 2008. |