85R5748 GRM-D
 
  By: Raymond H.B. No. 1127
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to a franchise tax credit pilot program for taxable
  entities that employ certain apprentices.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Chapter 171, Tax Code, is amended by adding
  Subchapter N to read as follows:
  SUBCHAPTER N.  TAX CREDIT PILOT PROGRAM FOR WAGES PAID TO CERTAIN
  APPRENTICES
         Sec. 171.701.  DEFINITION. In this subchapter, "registered
  apprenticeship" means an apprenticeship program that is:
               (1)  registered with the United States Department of
  Labor; and
               (2)  qualified to receive funding provided through the
  Texas Workforce Commission under Chapter 133, Education Code.
         Sec. 171.702.  ENTITLEMENT TO CREDIT. A taxable entity is
  entitled to a credit in the amount and under the conditions provided
  by this subchapter against the tax imposed under this chapter.
         Sec. 171.703.  QUALIFICATION. (a)  A taxable entity
  qualifies for a credit under this subchapter for wages paid to each
  apprentice who meets the requirements of Subsection (b) and is
  employed by the taxable entity in a registered apprenticeship
  position that is located or based in a county that borders the
  United Mexican States.
         (b)  The apprentice must: 
               (1)  be a member of a household with a total income that
  is at or below the income guidelines necessary to qualify for the
  national free or reduced-price lunch program established under 42
  U.S.C. Section 1751 et seq.; or
               (2)  reside in a census tract in which 30 percent or
  more of the population has a household income at or below 185
  percent of the federal poverty level. 
         Sec. 171.704.  AMOUNT; LIMITATIONS.  (a)  Subject to
  Subsection (b), the amount of the credit for a report in connection
  with each apprentice described by Section 171.703 is equal to the
  lesser of:
               (1)  50 percent of the wages paid by the taxable entity
  to the apprentice; or
               (2)  $5,000.
         (b)  The total amount of the credit for each report is equal
  to the lesser of:
               (1)  the total of the credits allowed under Subsection
  (a) for the reporting period for all apprentices; or
               (2)  the amount of franchise tax due after applying all
  other applicable credits.
         Sec. 171.705.  APPLICATION FOR CREDIT. (a)  A taxable entity
  must apply for a credit under this subchapter on or with the tax
  report for the period for which the credit is claimed.
         (b)  The comptroller shall promulgate a form for the
  application for the credit. A taxable entity must use the form in
  applying for the credit.
         Sec. 171.706.  PERIOD FOR WHICH CREDIT MAY BE CLAIMED. A
  taxable entity may claim a credit under this subchapter for a report
  only in connection with wages paid during the accounting period on
  which the report is based.
         Sec. 171.707.  REPORT ON PILOT PROGRAM.  (a)  Not later than
  September 1, 2022, the comptroller shall prepare and deliver to the
  governor, the lieutenant governor, the speaker of the house of
  representatives, and the presiding officer of each legislative
  standing committee with primary jurisdiction over taxation a report
  that evaluates the effect of the pilot program on the employment
  outcomes and earnings of apprentices with respect to whom credits
  are granted under the pilot program under this subchapter.  The
  report must include a recommendation regarding whether the pilot
  program should be continued, expanded, or terminated.
         (b)  A taxable entity that claims a credit under this
  subchapter shall provide to the comptroller information the
  comptroller requests to prepare the report described by Subsection
  (a). 
         Sec. 171.708.  EXPIRATION.  This subchapter expires December
  31, 2024.
         SECTION 2.  A taxable entity may claim the credit under
  Subchapter N, Chapter 171, Tax Code, as added by this Act, only for
  wages paid on or after the effective date of this Act and only on a
  franchise tax report originally due under Chapter 171, Tax Code, on
  or after that date.
         SECTION 3.  This Act takes effect January 1, 2018.