82R751 ALL-F
 
  By: Paxton H.B. No. 98
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the E-Z computation and rate of the franchise tax.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 171.1016, Tax Code, is transferred to
  Subchapter C, Chapter 171, Tax Code, and amended to read as follows:
         Sec. 171.1016.  E-Z COMPUTATION AND RATE. (a)
  Notwithstanding any other provision of this chapter, a taxable
  entity whose total revenue from its entire business is not more than
  $10 million may elect to pay the tax imposed under this chapter in
  the amount computed and at the rate provided by this section rather
  than in the amount computed and at the tax rate provided by Section
  171.002.
         (b)  The amount of the tax for which a taxable entity that
  elects to pay the tax as provided by this section is liable is
  computed by:
               (1)  determining the taxable entity's total revenue
  from its entire business, as determined under Section 171.1011;
               (2)  apportioning the amount computed under
  Subdivision (1) to this state, as provided by Section 171.106, to
  determine the taxable entity's apportioned total revenue; [and]
               (3)  subtracting the amount of federal income taxes the
  taxable entity paid during the period on which the report is based
  from the apportioned total revenue computed under Subdivision (2);
               (4)  subtracting $1 million from [multiplying] the
  amount computed under Subdivision (3); and
               (5)  applying to the difference computed under
  Subdivision (4) the appropriate tax rate, as follows:
                     (A)  subject to Subsection (c), if the difference
  is $1 million or less, the tax rate is 0.25 percent of the
  difference; or
                     (B)  if the difference is more than $1 million,
  the tax rate is $2,500 plus 0.5 percent of the amount of the
  difference that exceeds $1 million.
         (c)  A taxable entity is not required to pay any tax and is
  not considered to owe any tax for a period if the amount computed
  under Subsection (b)(4) is zero or less [(2) by the rate of 0.575
  percent].
         (d) [(c)]  A taxable entity that elects to pay the tax as
  provided by this section may not take a credit, deduction, or other
  adjustment that is not specifically authorized by this section.
         [(d)  Section 171.0021 applies to a taxable entity that
  elects to pay the tax as provided by this section.]
         (e)  A reference in this chapter or other law to the rate of
  the franchise tax means, as appropriate, the rate under Section
  171.002 or, for a taxable entity that elects to pay the tax as
  provided by this section, the rate under this section.
         SECTION 2.  Section 171.204(b), Tax Code, is amended to read
  as follows:
         (b)  The comptroller may require a taxable entity that does
  not owe any tax because of the application of Section 171.002(d)(2)
  to file an abbreviated information report with the comptroller
  stating the amount of the taxable entity's total revenue from its
  entire business.  The comptroller may require a taxable entity that
  does not owe any tax because of the application of Section
  171.1016(c) to file an abbreviated information report with the
  comptroller stating the amount computed under Section
  171.1016(b)(3). The comptroller may not require a taxable entity
  described by this subsection to file an information report that
  requires the taxable entity to report or compute its margin.
         SECTION 3.  The changes in law made by this Act apply only to
  a report originally due on or after the effective date of this Act.
         SECTION 4.  This Act takes effect January 1, 2012.