Bill Text: TX HB381 | 2013-2014 | 83rd Legislature | Introduced
Bill Title: Relating to the imposition of a personal income tax on income that exceeds $250,000 to provide property tax relief and fund public education; providing penalties.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2013-02-11 - Referred to Ways & Means [HB381 Detail]
Download: Texas-2013-HB381-Introduced.html
83R1706 ADM-D | ||
By: Burnam | H.B. No. 381 |
|
||
|
||
relating to the imposition of a personal income tax on income that | ||
exceeds $250,000 to provide property tax relief and fund public | ||
education; providing penalties. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Title 2, Tax Code, is amended by adding Subtitle | ||
L to read as follows: | ||
SUBTITLE L. PERSONAL INCOME TAX | ||
CHAPTER 261. PERSONAL INCOME TAX | ||
SUBCHAPTER A. IMPOSITION OF TAX | ||
Sec. 261.001. TAX IMPOSED. (a) A tax is imposed for each | ||
tax year: | ||
(1) on the taxable income that exceeds $250,000 of | ||
every resident of this state; and | ||
(2) on the taxable income that exceeds $250,000 | ||
derived from sources in this state of every nonresident. | ||
(b) The tax rates for an individual are: | ||
(1) for taxable income that exceeds $250,000 but does | ||
not exceed $500,000, four percent of the taxable income that | ||
exceeds $250,000 but does not exceed $500,000; | ||
(2) for taxable income that exceeds $500,000 but does | ||
not exceed $1 million, $10,000 plus five percent of the taxable | ||
income that exceeds $500,000 but does not exceed $1 million; or | ||
(3) for taxable income that exceeds $1 million, | ||
$35,000 plus six percent of the taxable income that exceeds $1 | ||
million. | ||
Sec. 261.002. JOINT RETURN. If persons subject to the tax | ||
under this chapter file a joint federal income tax return, they may | ||
file a joint return under this chapter but they may not combine | ||
their incomes, deductions, exemptions, or credits for the purpose | ||
of determining the amount of tax owed. The separate incomes of each | ||
joint filer are taxed as individual incomes under Section 261.001. | ||
Sec. 261.003. MEANING OF TERMS. (a) In this chapter: | ||
(1) an individual is a resident of this state if the | ||
individual: | ||
(A) is domiciled in this state, unless the | ||
individual does not maintain a permanent abode in this state and | ||
does maintain a permanent abode elsewhere and spends, in the | ||
aggregate, not more than 30 days of the tax year in this state; or | ||
(B) is not domiciled in this state but maintains | ||
a permanent abode in this state and spends, in the aggregate, more | ||
than 183 days of the tax year in this state; and | ||
(2) an individual is a nonresident if the individual | ||
is not a resident of this state. | ||
(b) Any term used in this chapter and not defined by or for | ||
purposes of this chapter has the same meaning as when used in a | ||
comparable context in the laws of the United States relating to | ||
federal income taxes, unless a different meaning is clearly | ||
required. Any reference in this chapter to federal law means the | ||
provisions of the Internal Revenue Code of 1986 and other | ||
provisions of federal laws relating to federal income taxes. | ||
[Sections 261.004-261.050 reserved for expansion] | ||
SUBCHAPTER B. COMPUTATION OF TAXABLE INCOME | ||
Sec. 261.051. TAXABLE INCOME. The taxable income of a | ||
resident of this state is the resident's federal adjusted gross | ||
income as defined by federal law. | ||
Sec. 261.052. CREDIT FOR INCOME TAX PAID TO ANOTHER STATE. | ||
(a) A resident individual is allowed a credit against the tax | ||
otherwise due under this chapter for the amount of any income tax | ||
imposed on the individual for the tax year by another state of the | ||
United States on income that is derived from sources in that state | ||
and that is subject to tax under this chapter. | ||
(b) The credit provided by this section may not exceed an | ||
amount equal to the tax otherwise due under this chapter multiplied | ||
by a fraction, the numerator of which is the taxpayer's adjusted | ||
gross income derived from sources in the other taxing jurisdiction | ||
as modified by this subchapter and the denominator of which is the | ||
taxpayer's entire adjusted gross income as modified by this | ||
subchapter. | ||
Sec. 261.053. DUAL RESIDENCE; REDUCTION OF TAX. If a | ||
taxpayer is a resident of this state and is regarded as a resident | ||
of another jurisdiction for purposes of personal income taxation, | ||
the comptroller shall reduce the tax on that portion of the | ||
taxpayer's income that is subject to tax in both jurisdictions | ||
solely by virtue of dual residence. The reduction is an amount | ||
equal to the lower of the two taxes applicable to the income taxed | ||
twice multiplied by a fraction, the numerator of which is the tax | ||
imposed by this state on the income taxed twice and the denominator | ||
of which is the combined taxes of the two jurisdictions on the | ||
income taxed twice. | ||
Sec. 261.054. NONRESIDENT INDIVIDUALS--TAXABLE INCOME. | ||
The taxable income of a nonresident individual is that part of the | ||
individual's federal adjusted gross income derived from sources in | ||
this state determined under Section 261.055. | ||
Sec. 261.055. ADJUSTED GROSS INCOME FROM SOURCES IN THIS | ||
STATE--NONRESIDENT. (a) The adjusted gross income of a | ||
nonresident derived from sources in this state is the net amount of | ||
items of income, gain, loss, and deduction entering into the | ||
nonresident's federal adjusted gross income that are derived from | ||
or connected with sources in this state, including: | ||
(1) the nonresident's distributive share of | ||
partnership income and deductions determined under Section | ||
261.403; and | ||
(2) the nonresident's share of estate or trust income | ||
and deductions derived from sources in this state. | ||
(b) Items of income, gain, loss, and deduction derived from | ||
or connected with sources in this state are those items | ||
attributable to: | ||
(1) the ownership or disposition of an interest in | ||
real or tangible personal property in this state; and | ||
(2) a business, trade, profession, or occupation | ||
conducted in this state. | ||
(c) Income from intangible personal property, including | ||
annuities, dividends, interest, and gains from the disposition of | ||
intangible personal property, constitutes income derived from | ||
sources in this state only to the extent that the income is from | ||
property used in a business, trade, profession, or occupation | ||
carried on in this state. | ||
(d) Deductions for capital losses, net long-term capital | ||
gains, and net operating losses derived from or connected with | ||
sources in this state are determined in the same manner as the | ||
corresponding federal deductions. However, the extent to which the | ||
deductions are derived from or connected with sources in this state | ||
is determined under the comptroller's rules. | ||
(e) For a nonresident individual who is a shareholder of a | ||
corporation that is an electing small business corporation for | ||
federal income tax purposes, the undistributed taxable income of | ||
the corporation does not constitute income derived from sources in | ||
this state and a net operating loss of the corporation does not | ||
constitute a loss or deduction connected with sources in this | ||
state. | ||
(f) If a business, trade, profession, or occupation is | ||
carried on partly in and partly outside this state, the items of | ||
income and deduction derived from or connected with sources in this | ||
state are determined by apportionment and allocation consistent | ||
with Chapter 141 under the comptroller's rules. | ||
(g) Compensation paid by the United States for service in | ||
the armed forces of the United States performed by a nonresident is | ||
not income derived from sources in this state. | ||
[Sections 261.056-261.100 reserved for expansion] | ||
SUBCHAPTER C. [RESERVED] | ||
[Sections 261.101-261.200 reserved for expansion] | ||
SUBCHAPTER D. ACCOUNTING PERIODS AND METHODS | ||
Sec. 261.201. PERIOD FOR COMPUTATION OF TAXABLE INCOME. | ||
(a) For purposes of the tax imposed by this chapter, a taxpayer's | ||
tax year is the same as the taxpayer's tax year for federal income | ||
tax purposes. | ||
(b) If a taxpayer's tax year is changed for federal income | ||
tax purposes, the taxpayer's tax year for purposes of the tax | ||
imposed by this chapter is similarly changed. | ||
Sec. 261.202. METHODS OF ACCOUNTING. (a) A taxpayer's | ||
method of accounting is the same as the taxpayer's method of | ||
accounting for federal income tax purposes. If a single method of | ||
accounting has not been regularly used by the taxpayer, taxable | ||
income for purposes of this chapter shall be computed under any | ||
method that in the opinion of the comptroller fairly reflects | ||
income. | ||
(b) If a taxpayer's method of accounting is changed for | ||
federal income tax purposes, the taxpayer's method of accounting | ||
for purposes of this chapter is changed in the same manner. | ||
Sec. 261.203. ADJUSTMENTS. In computing a taxpayer's | ||
taxable income for any tax year under a method of accounting | ||
different from the method under which the taxpayer's taxable income | ||
for the previous year was computed, there shall be taken into | ||
account those adjustments that are determined, under rules | ||
prescribed by the comptroller, to be necessary solely by reason of | ||
the change in order to prevent amounts from being duplicated or | ||
omitted. | ||
Sec. 261.204. LIMITATION ON ADDITIONAL TAX. (a) If a | ||
taxpayer's method of accounting is changed, other than from an | ||
accrual to an installment method, an additional tax that results | ||
from adjustments determined to be necessary solely because of the | ||
change may not be greater than if those adjustments were ratably | ||
allocated and included for the tax year of the change and not more | ||
than two preceding tax years during which the taxpayer used the | ||
method of accounting from which the change is made. | ||
(b) If a taxpayer's method of accounting is changed from an | ||
accrual to an installment method, an additional tax for the year of | ||
the change of method and for a subsequent year that is attributable | ||
to the receipt of installment payments properly accrued in a prior | ||
year is reduced by the portion of tax for any prior tax year | ||
attributable to the accrual of the installment payments, under | ||
rules adopted by the comptroller. | ||
[Sections 261.205-261.400 reserved for expansion] | ||
SUBCHAPTER E. PARTNERS AND PARTNERSHIPS | ||
Sec. 261.401. ENTITY NOT TAXABLE. A partnership as an | ||
entity is not subject to the tax imposed by this chapter. Persons | ||
carrying on business as partners are liable for the tax imposed by | ||
this chapter only in their separate or individual capacities. | ||
Sec. 261.402. RESIDENT PARTNER--ADJUSTED GROSS INCOME. (a) | ||
Partnership income, gain, loss, or deduction is allocated in | ||
accordance with each partner's distributive share for federal | ||
income tax purposes. | ||
(b) Each item of partnership income, gain, loss, or | ||
deduction has the same character for a partner under this chapter as | ||
it has for federal income tax purposes. If an item is not | ||
characterized for federal income tax purposes, it has the same | ||
character for a partner as if the partner realized the item directly | ||
from the source from which the partnership realized the item or the | ||
partner incurred the item in the same manner as the partnership | ||
incurred the item. | ||
(c) If a partner's distributive share of an item of | ||
partnership income, gain, loss, or deduction is determined for | ||
federal income tax purposes by a special provision in the | ||
partnership agreement with respect to the item, and the principal | ||
purpose of the provision is the avoidance or evasion of tax under | ||
this chapter, the partner's distributive share of the item for | ||
purposes of the tax under this chapter is determined in accordance | ||
with the method of determining the partner's distributive share of | ||
the taxable income or loss of the partnership generally, excluding | ||
those items requiring separate computation under Section 702, | ||
Internal Revenue Code of 1986. | ||
Sec. 261.403. NONRESIDENT PARTNER--ADJUSTED GROSS INCOME | ||
FROM SOURCES IN THIS STATE. (a) In determining the adjusted gross | ||
income of a nonresident partner of any partnership, there shall be | ||
included only that part derived from or connected with sources in | ||
this state of the partner's distributive share of items of | ||
partnership income, gain, loss, and deduction entering into the | ||
partner's federal adjusted gross income, as that part is determined | ||
under rules adopted by the comptroller consistent with the rules | ||
adopted under Section 261.055. | ||
(b) Except as authorized by Subsection (c), in determining | ||
the sources of a nonresident partner's income, no effect is given to | ||
a provision in the partnership agreement that: | ||
(1) characterizes payments to the partner as being for | ||
services or for the use of capital; | ||
(2) allocates to the partner, as income or gain from | ||
sources outside this state, a greater proportion of the partner's | ||
distributive share of partnership income or gain than the ratio of | ||
partnership income or gain from sources outside this state to | ||
partnership income or gain from all sources; or | ||
(3) allocates to the partner a greater proportion of a | ||
partnership item of loss or deduction connected with sources in | ||
this state than the partner's proportionate share, for federal | ||
income tax purposes, of partnership loss or deduction generally. | ||
(c) The comptroller may, on application, authorize the use | ||
of other appropriate and equitable methods of determining a | ||
nonresident partner's portion of partnership items derived from or | ||
connected with sources in this state on terms the comptroller may | ||
require. | ||
(d) A nonresident partner's distributive share of items of | ||
income, gain, loss, or deduction is determined under Section | ||
261.402(a). The character of partnership items for a nonresident | ||
partner is determined under Section 261.402(b). The effect of a | ||
special provision in a partnership agreement, other than a | ||
provision described by Subsection (b), having as a principal | ||
purpose the avoidance or evasion of tax under this chapter is | ||
determined under Section 261.402(c). | ||
[Sections 261.404-261.500 reserved for expansion] | ||
SUBCHAPTER F. TAX RETURNS AND PAYMENTS | ||
Sec. 261.501. PERSONS REQUIRED TO MAKE RETURNS OF INCOME. | ||
An individual who has adjusted gross income from sources in this | ||
state in excess of $250,000 shall file a state income tax return. | ||
Sec. 261.502. RETURNS BY FIDUCIARIES. (a) The executor, | ||
administrator, or other person charged with the care of a | ||
decedent's property shall file a state income tax return for the | ||
decedent if the decedent had adjusted gross income from sources in | ||
this state in excess of $250,000. A decedent's final return is due | ||
when it would have been due if the decedent had not died. | ||
(b) An individual's authorized agent, guardian, conservator | ||
or fiduciary or another person charged with the care of the | ||
individual or the individual's property, other than a receiver in | ||
possession of only a part of the individual's property, shall file a | ||
state income tax return for an individual who is unable to make a | ||
return because of minority or other disability if the individual | ||
has adjusted gross income from sources in this state in excess of | ||
$250,000. | ||
(c) If two or more fiduciaries are acting jointly, any one | ||
of them may file the return. | ||
Sec. 261.503. NOTICE OF QUALIFICATION AS RECEIVER. A | ||
receiver, trustee in bankruptcy, assignee for benefit of creditors, | ||
or other similar fiduciary shall give notice of the person's | ||
qualification to the comptroller, as may be required by rule. | ||
Sec. 261.504. CHANGE OF STATUS AS RESIDENT OR NONRESIDENT | ||
DURING YEAR. (a) If the status of an individual changes during the | ||
individual's tax year from resident to nonresident or from | ||
nonresident to resident, the comptroller by rule may require the | ||
individual to file one return for the portion of the year during | ||
which the individual is a resident and one for the portion of the | ||
year during which the individual is a nonresident. | ||
(b) Except as provided by Subsection (c), the taxable income | ||
of an individual is determined as provided by Section 261.051 for | ||
residents and Section 261.054 for nonresidents as if the | ||
individual's tax year for federal income tax purposes were limited | ||
to the period of the individual's resident and nonresident status | ||
respectively. | ||
(c) If an individual's residency status changes during a tax | ||
year, the individual shall include in taxable income for the period | ||
before the change an item of income, gain, loss, or deduction that: | ||
(1) was accrued by the individual before the change; | ||
and | ||
(2) would otherwise be includable or allowed after the | ||
change. | ||
(d) If two returns are required to be filed under this | ||
section, the total of the taxes due may not be less than would be due | ||
if the total of the taxable incomes reported on the two returns were | ||
includable in one return. | ||
Sec. 261.505. TIME AND PLACE FOR FILING RETURNS AND PAYING | ||
TAX. (a) A person required to make and file an income tax return | ||
required by this chapter shall: | ||
(1) file the return not later than the 15th day of the | ||
fourth month following the end of the taxpayer's tax year; and | ||
(2) pay a tax due to the comptroller not later than the | ||
last day the filing of the return is allowed without penalty, | ||
excluding an extension of time for filing the return. | ||
(b) The comptroller by rule shall prescribe the place for | ||
filing a return, statement, or other document required by this | ||
chapter and for the payment of a tax. | ||
Sec. 261.506. ESTIMATED TAX. (a) An individual subject to | ||
the income tax imposed by this chapter shall make estimated | ||
payments of the tax. Section 6654, Internal Revenue Code of 1986, | ||
other than Subsections (a), (b), (d)(2), and (e) of that section, | ||
governing the payment of estimated federal income taxes on | ||
individuals applies to the payments required by this section, | ||
including exemptions from the estimated tax payment requirement. | ||
For purposes of this section, a reference in Section 6654, Internal | ||
Revenue Code of 1986, to: | ||
(1) the federal income tax imposed on an individual | ||
means the tax imposed by this chapter; and | ||
(2) a power or duty given to the United States | ||
secretary of the treasury means a power or duty assigned to the | ||
comptroller. | ||
(b) The comptroller shall adopt rules to administer this | ||
section. | ||
(c) Payment of the estimated tax or an installment is | ||
considered payment on account of the tax imposed by this chapter. | ||
Sec. 261.507. EXTENSION OF TIME FOR FILING AND PAYMENT. (a) | ||
The comptroller, on terms the comptroller may require, may grant a | ||
reasonable extension of time for payment of tax or an installment, | ||
or for filing a return, statement, or other document required under | ||
this chapter. Except for an extension for a taxpayer who is outside | ||
the United States, an extension for filing a return, statement, or | ||
document may not exceed six months. | ||
(b) If the time for the payment of an amount of tax is | ||
extended, the comptroller may require the taxpayer to furnish a | ||
bond or other security in an amount that does not exceed twice the | ||
amount of tax for which the extension of time for payment is | ||
granted, on terms the comptroller may require. | ||
Sec. 261.508. CHANGE OF ELECTION. An election expressly | ||
authorized by this chapter may be changed as authorized by the | ||
comptroller or by comptroller rule. | ||
Sec. 261.509. SIGNING OF RETURNS AND OTHER DOCUMENTS. (a) | ||
A return, statement, or other document required to be made or filed | ||
under this chapter must be signed as provided by the comptroller. | ||
An individual's name signed to a return, statement, or other | ||
document is prima facie evidence that the individual signed the | ||
return, statement, or other document. | ||
(b) A return, statement, or other document required of a | ||
partnership must be signed by at least one partner. A partner's | ||
name signed to a return, statement, or other document is prima facie | ||
evidence that the partner is authorized to sign on behalf of the | ||
partnership. | ||
(c) The making or filing of a return, statement, or other | ||
document or copy required to be made or filed under this chapter, | ||
including a copy of a federal income tax return, constitutes a | ||
certification by the person making or filing the return, statement, | ||
or other document or copy that the statements contained in it are | ||
true and that a copy filed is a true copy. | ||
[Sections 261.510-261.520 reserved for expansion] | ||
SUBCHAPTER G. INFORMATION RETURNS | ||
Sec. 261.521. GENERAL REQUIREMENTS. The comptroller by | ||
rule may require the keeping of records, the content and form of | ||
returns and statements, and the filing of copies of federal income | ||
tax returns and determinations. The comptroller may require a | ||
person, by rule or by notice served on the person, to make returns, | ||
provide statements, or keep records, as the comptroller considers | ||
sufficient to show whether the person is liable under this chapter | ||
for tax or for the collection of tax. | ||
Sec. 261.522. REPORT OF CHANGE IN FEDERAL TAXABLE INCOME. | ||
(a) If the amount of a taxpayer's federal taxable income reported | ||
on the taxpayer's federal income tax return for a tax year is | ||
changed or corrected by the United States Internal Revenue Service | ||
or other competent authority, or as the result of a renegotiation of | ||
a contract or subcontract with the United States, the taxpayer | ||
shall: | ||
(1) report the change or correction in federal taxable | ||
income not later than the 90th day after the final determination of | ||
the change, correction, or renegotiation, or as required by the | ||
comptroller; and | ||
(2) concede the accuracy of the determination or state | ||
in what way it is erroneous. | ||
(b) A taxpayer filing an amended federal income tax return | ||
shall also file, not later than the 90th day after filing the | ||
federal return, an amended return under this chapter, and shall | ||
give any information required by the comptroller. | ||
(c) The comptroller by rule may prescribe exceptions to the | ||
requirements of this section. | ||
[Sections 261.523-261.600 reserved for expansion] | ||
SUBCHAPTER H. ADDITIONS TO TAX; PENALTIES | ||
Sec. 261.601. FAILURE TO FILE TAX RETURN. (a) A person who | ||
does not file a return required under this chapter on or before the | ||
prescribed date is subject to the following penalty based on a | ||
percentage of the full amount of tax owed on the prescribed day: | ||
(1) if the return is filed not later than the 30th day | ||
after the prescribed date, five percent; | ||
(2) if the return is filed later than the 30th day | ||
after the prescribed date, but not later than the 60th day after the | ||
prescribed date, 10 percent; | ||
(3) if the return is filed later than the 60th day | ||
after the prescribed date, but not later than the 90th day after the | ||
prescribed date, 15 percent; | ||
(4) if the return is filed later than the 90th day | ||
after the prescribed date, but not later than the 120th day after | ||
the prescribed date, 20 percent; or | ||
(5) if the return is filed later than the 120th day | ||
after the prescribed date, 25 percent. | ||
(b) The prescribed date is determined with regard to an | ||
extension of time for filing. | ||
(c) In determining the amount owed on the prescribed date, | ||
the taxpayer is entitled to credit for a portion of the tax paid on | ||
or before the prescribed date and other credit that may be claimed | ||
on the return. | ||
(d) The penalty required by this section does not apply if | ||
the taxpayer shows that the failure to file a return was not the | ||
result of wilful neglect before the prescribed date or at any time | ||
during the delinquency and that good cause for the failure existed | ||
at all times before filing. | ||
Sec. 261.602. FAILURE TO PAY TAX. (a) A person who does not | ||
pay any amount of tax owed by the person on the prescribed date | ||
shall pay, in addition to all other penalties and interest, a | ||
penalty of 10 percent of the amount of the tax due on the prescribed | ||
date. | ||
(b) The prescribed date is determined with regard to | ||
extensions of time allowed by the comptroller. | ||
(c) A failure to pay all or part of an estimated tax is | ||
considered to be an underpayment of estimated tax. The comptroller | ||
by rule shall prescribe the method of determining the amount and | ||
period of underpayment. | ||
Sec. 261.603. PENALTIES AND INTEREST TREATED AS TAX. The | ||
taxpayer shall pay penalties and interest provided by this | ||
subchapter on receiving notice and demand. The comptroller shall | ||
assess and collect and the taxpayer shall pay penalties and | ||
interest in the same manner as other taxes. The comptroller may | ||
issue a deficiency notice for all or part of a penalty or interest | ||
along with or separate from the amount of tax owed in the absence of | ||
penalties or interest. | ||
[Sections 261.604-261.630 reserved for expansion] | ||
SUBCHAPTER I. CREDITS AND REFUNDS | ||
Sec. 261.631. CREDITS AND REFUNDS. (a) Within the | ||
applicable period of limitations, the comptroller may credit an | ||
overpayment of income tax and interest on the overpayment against a | ||
tax liability to this state of the person who made the overpayment. | ||
The comptroller shall refund the balance out of the proceeds of the | ||
tax retained by the comptroller. | ||
(b) The comptroller may prescribe rules that allow the | ||
comptroller to credit against the estimated tax for a tax year the | ||
amount determined to be an overpayment of the income tax for a | ||
preceding tax year. | ||
(c) If an amount of income tax is assessed and collected | ||
after the expiration of the period of limitations, the amount | ||
collected is an overpayment. | ||
Sec. 261.632. ABATEMENTS. (a) The comptroller may abate | ||
any unpaid portion of a tax or a tax liability that is excessive in | ||
amount, that is assessed after the expiration of the applicable | ||
period of limitations, or that is erroneously or illegally | ||
assessed. | ||
(b) The comptroller may abate the unpaid portion of a tax or | ||
a tax liability if the comptroller determines under rules | ||
prescribed by the comptroller that the administration and | ||
collection costs involved would not warrant collection of the | ||
amount due. | ||
Sec. 261.633. EXTENDED LIMITATION PERIOD. (a) If a | ||
taxpayer is required by Section 261.522 to report a change or | ||
correction in federal taxable income reported on a federal income | ||
tax return, to report a change or correction that is treated in the | ||
same manner as if it were an overpayment for federal income tax | ||
purposes, or to file an amended return with the comptroller, a claim | ||
for credit or refund of a resulting overpayment of tax must be filed | ||
by the taxpayer not later than the second anniversary of the date | ||
the notice of the change or correction or the amended return was | ||
required to be filed with the comptroller. If the report or amended | ||
return required by Section 261.522 is not filed within the period | ||
prescribed by that section, interest on a resulting refund or | ||
credit does not accrue after the period. The amount of credit or | ||
refund may not exceed the amount of the reduction in tax | ||
attributable to the federal change, correction, or amendment to | ||
items on the taxpayer's amended federal income tax return. This | ||
subsection does not affect the time within which or the amount for | ||
which a claim for credit or refund may be filed under a provision | ||
other than this section. | ||
(b) A taxpayer may file a claim for credit or refund, under | ||
rules adopted by the comptroller, not later than the seventh | ||
anniversary of the due date of the return for the period with | ||
respect to which the claim is made if the claim relates to an | ||
overpayment of tax resulting from: | ||
(1) the deduction of: | ||
(A) a debt that became worthless; or | ||
(B) a loss from the worthlessness of a security; | ||
or | ||
(2) the effect that a deduction described by | ||
Subdivision (1) has on the application to the taxpayer of a | ||
carryover. | ||
(c) If a claim for credit or refund relates to an | ||
overpayment attributable to a net operating loss carryback, the | ||
claim may be made, under rules adopted by the comptroller, not later | ||
than the 15th day of the 40th month following the end of the tax year | ||
of the net operating loss that resulted in the carryback or the | ||
period prescribed by Section 111.104, whichever expires later. | ||
[Sections 261.634-261.650 reserved for expansion] | ||
SUBCHAPTER J. MISCELLANEOUS ENFORCEMENT PROVISIONS | ||
Sec. 261.651. TAXPAYER NOT RESIDENT. If notice and demand | ||
for the payment of a tax is given to a nonresident and it appears to | ||
the comptroller that it is not practicable to locate property of the | ||
taxpayer sufficient in amount to cover the amount of tax due, the | ||
comptroller may authorize the institution of any available action | ||
or proceeding to collect or enforce the claim in any place by any | ||
procedure by which a civil judgment of a court of record of this | ||
state could be collected or enforced. The comptroller may | ||
designate agents or retain counsel outside this state for the | ||
purpose of collecting taxes due under this chapter and require of | ||
them bonds or other security for the faithful performance of their | ||
duties. The comptroller may enter into agreements with the tax | ||
department of another state for the collection of taxes from | ||
persons found in this state who are delinquent in the payment of | ||
income taxes imposed by that state on the condition that the other | ||
state provides similar assistance in the collection of taxes from | ||
persons found in that state who are delinquent in the payment of | ||
taxes imposed by this chapter. | ||
Sec. 261.652. INCOME TAX CLAIMS OF OTHER STATES. The courts | ||
of this state shall recognize and enforce liabilities for personal | ||
income taxes lawfully imposed by another state if that state | ||
recognizes and enforces liabilities under this chapter, and the | ||
authorized officer of the other state may sue for the collection of | ||
personal income tax in the courts of this state. A certificate by | ||
the secretary of state of the other state that an officer suing for | ||
the collection of the tax is authorized to collect the tax is | ||
conclusive proof of the officer's authority. In this section, | ||
"taxes" includes additions to tax, interest, and penalties. | ||
Sec. 261.653. ORDER TO COMPEL COMPLIANCE. (a) On | ||
application of the attorney general, a judge of a court that has | ||
personal jurisdiction over a taxpayer or other person who | ||
intentionally or knowingly refuses to file a tax return required by | ||
this chapter may, by order, direct the person to file the return. A | ||
person who fails or refuses to obey the order is guilty of contempt | ||
of court. | ||
(b) If any person intentionally or knowingly refuses to make | ||
available any books, papers, records, or memoranda for examination | ||
by the comptroller or wilfully refuses to attend and testify, in | ||
accordance with the powers conferred on the comptroller by Chapter | ||
111, on application of the comptroller, a judge of a court that has | ||
personal jurisdiction over the person may by order direct the | ||
person to comply with the comptroller's request for books, papers, | ||
records, or memoranda or for the person's attendance and testimony. | ||
If the books, papers, records, or memoranda required by the | ||
comptroller are in the custody of a corporation, the order of the | ||
court may be directed to any principal officer of the corporation. | ||
A person who fails or refuses to obey the order is guilty of | ||
contempt of court. | ||
Sec. 261.654. TRANSFEREES. (a) In this section, | ||
"transferee" includes an heir or a recipient of a donation, legacy, | ||
devise, or distribution. | ||
(b) If a transferee of a taxpayer's property is liable at | ||
law or in equity for any tax, addition to tax, penalty, or interest | ||
owed by the taxpayer under this chapter, the provisions and | ||
limitations of this chapter apply to the transferee as if the | ||
transferee were the taxpayer except as otherwise provided by this | ||
section. | ||
(c) The comptroller may not assess tax liability against a | ||
transferee of a taxpayer's property after: | ||
(1) the first anniversary of the expiration of the | ||
period of limitation against the taxpayer if the transferee is the | ||
initial transferee; | ||
(2) the first anniversary of the expiration of the | ||
period of limitation against the preceding transferee, but not | ||
later than the third anniversary of the expiration of the period of | ||
limitation for assessment against the taxpayer, if the transferee | ||
is not the initial transferee; or | ||
(3) notwithstanding Subdivisions (1) and (2), if | ||
before the expiration of the period of limitation under Subdivision | ||
(1) or (2) a proceeding for the collection of the liability has been | ||
initiated against the taxpayer or the last preceding transferee, | ||
the first anniversary of the date on which the proceeding is | ||
terminated. | ||
(d) If, before the expiration of the period of limitation | ||
applicable to a transferee, the comptroller and the transferee | ||
consent in writing to an assessment after that time, the liability | ||
may be assessed at any time before the expiration of the agreed | ||
period. The period of limitation on credit or refund to the | ||
transferee of overpayments of tax made by the transferee or by the | ||
taxpayer to which the transferee is legally entitled is extended by | ||
an agreement under this subsection and any extension of the | ||
agreement. | ||
(e) If a person dies, the period of limitation for | ||
assessment against that person is the period that would be in effect | ||
had death not occurred. | ||
Sec. 261.655. JEOPARDY DETERMINATIONS. (a) If the | ||
comptroller issues a jeopardy determination for a tax for a current | ||
period, the comptroller shall terminate the tax period of the | ||
taxpayer immediately, and the notice and demand for a return and | ||
immediate payment of the tax shall apply to the terminated period | ||
and to income accrued and deductions incurred on or before the | ||
termination date if not otherwise properly includable or deductible | ||
for the period. | ||
(b) The comptroller may abate the jeopardy determination if | ||
the comptroller finds that jeopardy does not exist. | ||
Sec. 261.656. BANKRUPTCY OR RECEIVERSHIP. (a) The | ||
comptroller may immediately assess any deficiency determined by the | ||
comptroller, together with additions to tax and interest provided | ||
by law, on the adjudication of bankruptcy of any taxpayer in any | ||
bankruptcy proceeding or the appointment of a receiver for any | ||
taxpayer in any receivership proceeding before any court of the | ||
United States or any state or territory. | ||
(b) The comptroller may present a claim for a deficiency, | ||
addition to tax, or interest to the court before which a bankruptcy | ||
or receivership proceeding is pending regardless of whether the | ||
taxpayer is contesting the deficiency, addition to tax, or interest | ||
under Chapter 111 or 112. A taxpayer may not contest a proposed | ||
assessment under Chapter 111 after the taxpayer is adjudged | ||
bankrupt or a receiver is appointed for the taxpayer. | ||
Sec. 261.657. EVIDENCE OF RELATED FEDERAL DETERMINATION. | ||
Evidence of a federal determination relevant to the taxes imposed | ||
by this chapter is admissible in an administrative or judicial | ||
proceeding relating to those taxes. | ||
[Sections 261.658-261.670 reserved for expansion] | ||
SUBCHAPTER K. OFFENSES | ||
Sec. 261.671. ATTEMPT TO EVADE OR DEFEAT TAX. (a) A person | ||
commits an offense if the person intentionally or knowingly | ||
attempts in any manner to evade or defeat a tax imposed by this | ||
chapter or the payment of tax imposed by this chapter. | ||
(b) An offense under this section is a felony of the third | ||
degree. | ||
Sec. 261.672. FAILURE TO PAY. (a) A person commits an | ||
offense if the person is required under this chapter to pay a tax | ||
imposed by this chapter and the person intentionally or knowingly | ||
fails to pay the tax. | ||
(b) An offense under this section is a felony of the third | ||
degree. | ||
Sec. 261.673. FAILURE TO FILE RETURN, KEEP RECORDS, SUPPLY | ||
INFORMATION, OR PAY TAX. (a) A person commits an offense if the | ||
person is required under this chapter to pay a tax, or required by | ||
this chapter or rule adopted under this chapter to make a return, to | ||
keep records, or to supply information, and the person | ||
intentionally or knowingly fails to pay the tax, make the return, | ||
keep the records, or supply the information at the time or times | ||
required by law. | ||
(b) An offense under this section is a Class A misdemeanor. | ||
[Sections 261.674-261.680 reserved for expansion] | ||
SUBCHAPTER L. POWERS OF COMPTROLLER | ||
Sec. 261.681. COOPERATION WITH OTHER JURISDICTIONS. The | ||
comptroller may permit the United States secretary of the treasury | ||
or the secretary's delegate, or the proper officer of any state or | ||
other jurisdiction imposing an income tax on the incomes of | ||
individuals, or the authorized representative of either officer, to | ||
inspect the income tax returns of an individual, or may furnish to | ||
the officer or authorized representative an abstract of the return | ||
of income of an individual or supply the officer with information | ||
concerning an item of income contained in a return, or disclosed by | ||
the report of an investigation of the income or return of income of | ||
an individual, but permission may be granted only if the statutes of | ||
the United States or of the other jurisdiction, as applicable, | ||
grant substantially similar privileges to the comptroller. | ||
Sec. 261.682. COOPERATION WITH OTHER TAX OFFICIALS OF THIS | ||
STATE. The comptroller may permit other tax officials of this state | ||
to inspect tax returns and reports filed under this chapter but the | ||
inspection is permitted only for purposes of enforcing a tax law and | ||
only to the extent and under the conditions prescribed by rule of | ||
the comptroller. | ||
Sec. 261.683. CONTRACT WITH SECRETARY OF TREASURY FOR | ||
COLLECTION OF TAX. The comptroller may enter into an agreement with | ||
the United States secretary of the treasury or the secretary's | ||
delegate under which, to the extent provided by the terms of the | ||
agreement, the secretary or delegate will administer, enforce, and | ||
collect a tax imposed by this chapter on behalf of this state. The | ||
cost of the services performed by the secretary or delegate in | ||
administering, enforcing, or collecting the tax under the terms of | ||
the agreement may be paid from the appropriations for the general | ||
operations of the comptroller. | ||
Sec. 261.684. ARMED FORCES RELIEF PROVISIONS. (a) The | ||
period of service in the armed forces of the United States in a | ||
combat zone plus a period of continuous hospitalization outside | ||
this state attributable to that service plus the next 180 days is | ||
disregarded in determining, under rules of the comptroller, whether | ||
an act required by this chapter was performed by a taxpayer or the | ||
taxpayer's representative within the time prescribed. | ||
(b) If an individual dies during an induction period while | ||
in active service as a member of the armed forces of the United | ||
States and the death occurred while the individual was serving in a | ||
combat zone or as a result of wounds, disease, or injury incurred | ||
while serving, the tax imposed by this chapter does not apply to the | ||
tax year in which the individual dies or to any prior tax year | ||
ending on or after the first day the individual served in a combat | ||
zone. | ||
Sec. 261.685. DISPOSITION OF PROCEEDS. The revenue from | ||
the tax imposed by this chapter shall be deposited as follows: | ||
(1) two-thirds of the revenue shall be deposited to | ||
the credit of a special account in the general revenue fund and may | ||
be appropriated only for the purpose of reducing the rate of ad | ||
valorem maintenance and operations taxes levied for the support of | ||
primary and secondary education in the manner provided by Sections | ||
24(h) and (i), Article VIII, Texas Constitution, for the reduction | ||
of that rate; and | ||
(2) one-third to the credit of the foundation school | ||
fund. | ||
SECTION 2. Section 111.201, Tax Code, is amended to read as | ||
follows: | ||
Sec. 111.201. ASSESSMENT LIMITATION. (a) No tax imposed by | ||
this title may be assessed after four years from the date that the | ||
tax becomes due and payable except as provided by Subsection (b). | ||
(b) Except as otherwise provided by Chapter 261, a tax | ||
imposed by that chapter may not be assessed after six years from the | ||
date the tax becomes due and payable. | ||
SECTION 3. A referendum as required by Section 24, Article | ||
VIII, Texas Constitution, on the adoption of the income tax under | ||
this Act shall be submitted to the voters at an election to be held | ||
November 5, 2013. The ballot for the referendum shall be printed to | ||
permit voting for or against the proposition: "The adoption of a | ||
personal income tax at graduated rates of four percent to six | ||
percent for taxable income in excess of $250,000." | ||
SECTION 4. (a) Except as provided by Subsection (b) of this | ||
section, this Act applies to income earned, accrued, or received on | ||
or after the effective date of this Act. | ||
(b) Income, deductions, losses, credits against income, or | ||
other adjustments allowed in determining the amount of tax under | ||
this Act or the amount of federal adjusted gross income under this | ||
Act, including carryovers, are not prohibited in computing the | ||
taxes for a tax period beginning on January 1, 2014, because those | ||
adjustments may have accrued or otherwise originated before the | ||
effective date of this Act. | ||
(c) In 2014, the comptroller by rule may suspend the | ||
application of Section 261.506, Tax Code, as added by this Act, | ||
wholly or partly and may extend the deadlines for estimated tax | ||
payments under that section. | ||
SECTION 5. (a) Except as provided by Section 6 of this Act, | ||
if the proposition in Section 3 of this Act is approved, this Act | ||
takes effect January 1, 2014. | ||
(b) Except as provided by Section 6 of this Act, if the | ||
proposition in Section 3 of this Act is not approved, this Act has | ||
no effect. | ||
SECTION 6. Section 3 of this Act takes effect September 1, | ||
2013. |