Texas Tax Code

§ 171.111 — TEMPORARY CREDIT ON TAXABLE MARGIN

TX § 171.111Title 2. STATE TAXATION · Part F. FRANCHISE TAX; CREDITS · Ch. 171. FRANCHISE TAX · Art. C. DETERMINATION OF TAXABLE MARGIN; ALLOCATION AND APPORTIONMENT

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(a)On the first report originally due under this chapter on or after January 1, 2008, a taxable entity must notify the comptroller in writing of its intent to take a credit in an amount allowed by this section on the tax due on taxable margin. The taxable entity may thereafter elect to claim the credit for the current year and future year at or before the original due date of any report due after January 1, 2008, until the taxable entity revokes the election or this section expires, whichever is earlier. A taxable entity may claim the credit for not more than 20 consecutive privilege periods beginning with the first report originally due under this chapter on or after January 1, 2008. A taxable entity may make only one election under this section and the election may not be conveyed, assigned, or transferred to another entity.

(b)The credit allowed under this section for any privilege period is computed by:

(1)determining the amount of the business loss carryforwards of the taxable entity under Section 171.110(e), as that section applied to annual reports originally due before January 1, 2008, that were not exhausted on a report originally due under this chapter before January 1, 2008;

(2)multiplying the amount determined under Subdivision (1) by:

(A)2.25 percent for reports originally due on or after January 1, 2008, and before January 1, 2018; and

(B)7.75 percent for reports originally due on or after January 1, 2018, and before September 1, 2027; and

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Legislative history

Acts 2006, 79th Leg., 3rd C.S., Ch. 1 (H.B. 3), Sec. 5, eff. January 1, 2008. Acts 2007, 80th Leg., R.S., Ch. 1282 (H.B. 3928), Sec. 23, eff. January 1, 2008.