Creighton Bill Lets Security Gear Wipe Out Franchise Tax

The text as introduced · 513 words

89R4902 JBD-D

By: Creighton
S.B. No. 1231

A BILL TO BE ENTITLED

AN ACT

relating to a franchise tax credit for taxable entities that

purchase certain theft deterrent and property loss prevention

equipment.

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 FOR PURCHASE OF THEFT DETERRENT AND

PROPERTY LOSS PREVENTION EQUIPMENT

Sec. 171.701. 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. 171.702. QUALIFICATION. A taxable entity qualifies

for a credit under this subchapter if the taxable entity purchases

one or more items of theft deterrent or property loss prevention

equipment included on the list of eligible equipment adopted under

Section 171.707.

Sec. 171.703. AMOUNT OF CREDIT; LIMITATION. (a) Subject to

Subsection (b), the amount of the credit for a report is equal to

the total amount of costs and expenses incurred by a taxable entity

to purchase items described by Section 171.702 during the period on

which the report is based, including the purchase price of those

items.

(b) The total credit claimed on a report, including the

amount of any carryforward under Section 171.704, may not exceed

the amount of franchise tax due for the report after applying all

other applicable credits.

Sec. 171.704. CARRYFORWARD. (a) A taxable entity that is

eligible for a credit that exceeds the limitation under Section

171.703(b) may carry the unused credit forward for not more than

five consecutive reports.

(b) A carryforward is considered the remaining portion of a

credit that cannot be claimed in the current year because of the

limitation under Section 171.703(b).

(c) Credits, including a carryforward, are considered to be

used in the following order:

(1) a carryforward under this subchapter; and

(2) a current year credit.

Sec. 171.705. APPLICATION FOR CREDIT. (a) A taxable entity

must apply for a credit under this subchapter on or with the report

for the period for which the credit is claimed.

(b) The comptroller shall prescribe the form and method a

taxable entity must use to apply for the credit.

(c) The comptroller may require a taxable entity to submit

with an application any information needed to determine whether the

taxable entity qualifies for the credit or the amount of the credit.

Sec. 171.706. ASSIGNMENT PROHIBITED; EXEMPTION. A taxable

entity may not convey, assign, or transfer the credit allowed under

this subchapter to another taxable entity unless substantially all

of the assets of the taxable entity are conveyed, assigned, or

transferred in the same transaction.

Sec. 171.707. RULES. The comptroller shall adopt rules

necessary to implement and administer this subchapter, including a

list of equipment useful or necessary to deter theft or prevent

property loss that is eligible for the credit.

SECTION 2. This Act applies only to a report originally due

on or after the effective date of this Act.

SECTION 3. This Act takes effect January 1, 2026.