Texas Tax Code

§ 111.024 — LIABILITY IN FRAUDULENT TRANSFERS

TX § 111.024Title 2. STATE TAXATION · Part B. ENFORCEMENT AND COLLECTION · Ch. 111. COLLECTION PROCEDURES · Art. A. COLLECTION DUTIES AND POWERS

Statute text

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(a)A person who acquires a business or the assets of a business from a taxpayer through a fraudulent transfer or a sham transaction is liable for any tax, penalty, and interest owed by the taxpayer.

(b)A transfer of a business or the assets of a business is considered to be a fraudulent transfer or a sham transaction if the taxpayer made the transfer or undertook the transaction:

(1)with intent to evade, hinder, delay, or prevent the collection of any tax, penalty, or interest owed under this title; or

(2)without receiving a reasonably equivalent value in exchange for the business or business assets subject to the transfer or transaction.

(c)In determining the intent of the taxpayer under Subsection (b)(1), consideration may be given, among other factors, to whether:

(1)the transfer was to a current or former business insider, associate, or employee of the taxpayer or to a person related to the taxpayer within the third degree of consanguinity by blood or marriage;

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Legislative history

Added by Acts 2001, 77th Leg., ch. 442, Sec. 6, eff. Sept. 1, 2001.