Bill Text: TX HB2940 | 2015-2016 | 84th Legislature | Introduced
Bill Title: Relating to the determination of compensation for purposes of the franchise tax.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2015-03-16 - Referred to Ways & Means [HB2940 Detail]
Download: Texas-2015-HB2940-Introduced.html
84R13304 BEF-F | ||
By: Capriglione | H.B. No. 2940 |
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relating to the determination of compensation for purposes of the | ||
franchise tax. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 171.1013, Tax Code, is amended by | ||
amending Subsection (a) and adding Subsection (i) to read as | ||
follows: | ||
(a) Except as otherwise provided by this section, "wages and | ||
cash compensation" means the amount entered in the Medicare wages | ||
and tips box of Internal Revenue Service Form W-2 or any subsequent | ||
form with a different number or designation that substantially | ||
provides the same information. The term also includes, to the | ||
extent not included above: | ||
(1) net distributive income from a taxable entity | ||
treated as a partnership for federal income tax purposes, but only | ||
if the person receiving the distribution is a natural person; | ||
(2) net distributive income from limited liability | ||
companies and corporations treated as S corporations for federal | ||
income tax purposes, but only if the person receiving the | ||
distribution is a natural person; | ||
(3) stock awards and stock options deducted for | ||
federal income tax purposes; [ |
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(4) net distributive income from a limited liability | ||
company treated as a sole proprietorship for federal income tax | ||
purposes, but only if the person receiving the distribution is a | ||
natural person; and | ||
(5) payroll taxes paid by a taxable entity in | ||
connection with the employment of an officer, director, owner, | ||
partner, or employee. | ||
(i) Subject to Section 171.1014 and the limitation in | ||
Subsection (c), a taxable entity that elects to subtract | ||
compensation for the purpose of computing its taxable margin under | ||
Section 171.101 may include as wages and cash compensation any | ||
nonemployee compensation paid to an independent contractor as | ||
reported on Internal Revenue Service Form 1099 or any subsequent | ||
form with a different number or designation that substantially | ||
provides the same information. | ||
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, 2016. |