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A BILL TO BE ENTITLED
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AN ACT
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relating to a franchise tax credit for research and development of |
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energy storage technologies. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 171, Tax Code, is amended by adding |
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Subchapter V to read as follows: |
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SUBCHAPTER V. TAX CREDIT FOR RESEARCH AND DEVELOPMENT OF ENERGY |
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STORAGE TECHNOLOGY |
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Sec. 171.901. DEFINITIONS. In this subchapter: |
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(1) "Base amount" and "qualified research expenses" |
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have the meanings assigned by Section 41, Internal Revenue Code, |
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except that all payments and expenses must be for research |
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conducted in this state that relates to the development of energy |
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storage technologies. |
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(2) "Energy storage technology" means a technology for |
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storing generated electricity for later transmission and |
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distribution. |
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Sec. 171.902. ENTITLEMENT TO CREDIT. A taxable entity is |
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entitled to a credit in the amount and under the conditions and |
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limitations provided by this subchapter against the tax imposed |
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under this chapter. |
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Sec. 171.903. AMOUNT; LIMITATIONS. (a) The credit for a |
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report is equal to the sum of the excess of qualified research |
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expenses incurred in this state during the accounting period on |
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which the tax is based over the base amount for that research. |
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(b) For the purposes of this section, "gross receipts" as |
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used in Section 41, Internal Revenue Code, means gross receipts as |
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determined under Section 171.103. |
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(c) The total credit claimed under this subchapter for a |
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report may not exceed the amount of franchise tax due after any |
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other applicable credits. |
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Sec. 171.904. CARRYFORWARD. (a) If a taxable entity is |
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eligible for a credit that exceeds the limitation under Section |
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171.903(c), the taxable entity may carry the unused credit forward |
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for not more than 20 consecutive reports. |
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(b) A carryforward is considered the remaining portion of a |
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credit that cannot be claimed in the current year because of the |
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limitation under Section 171.903(c). A carryforward is added to the |
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next year's credit in determining whether the limitation is met for |
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that year. A credit carryforward from a previous report is |
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considered to be used before the current year credit. |
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Sec. 171.905. ASSIGNMENT PROHIBITED. A taxable entity may |
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not convey, assign, or transfer the credit allowed under this |
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subchapter to another entity unless all of the assets of the taxable |
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entity are conveyed, assigned, or transferred. |
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Sec. 171.906. RULES. The comptroller shall adopt rules |
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necessary to implement this subchapter. |
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SECTION 2. This Act applies only to a report originally due |
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on or after the effective date of this Act. |
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SECTION 3. This Act takes effect January 1, 2022. |