SB524 - Relating to the exemption from the franchise tax and certain filing fees for certain businesses owned by veterans.

      By: Campbell, et al. S.B. No. 524     A BILL TO BE ENTITLED   AN ACT   relating to the exemption from the franchise tax and certain filing   fees for certain businesses owned by veterans.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Effective January 1, 2031, Section 171.0001(4),   Tax Code, is amended to read as follows:                (4)  "Beginning date" means:                      (A)  [ except as provided by Paragraph (B):                            [ (i) ]  for a taxable entity chartered or   organized in this state, the date on which the taxable entity's   charter or organization takes effect; and                       (B)  [ (ii) ]  for any other taxable entity, the date   on which the taxable entity begins doing business in this state[ ; or                      [ (B)     for a taxable entity that qualifies as a new   veteran-owned business as defined by Section 171.0005, the earlier   of:                            [ (i)     the fifth anniversary of the date on   which the taxable entity begins doing business in this state; or                            [ (ii)     the date the taxable entity ceases to   qualify as a new veteran-owned business as defined by Section   171.0005 ].          SECTION 2.  Effective January 1, 2031, Section 171.063(g),   Tax Code, is amended to read as follows:          (g)  If a corporation's federal tax exemption is withdrawn by   the Internal Revenue Service for failure of the corporation to   qualify or maintain its qualification for the exemption, the   corporation's exemption under this section ends on the effective   date of that withdrawal by the Internal Revenue Service.  The   effective date of the withdrawal is considered the corporation's   beginning date for purposes of determining the corporation's   privilege periods and for all other purposes of this chapter[ ,   except that if the corporation would have been subject to Section   171.001(d) in the absence of the federal tax exemption, and the   effective date of the withdrawal is a date earlier than the date the   corporation would have become subject to the franchise tax as   provided by Section 171.001(d), the date the corporation would have   become subject to the franchise tax under that section is   considered the corporation's beginning date for those purposes ].          SECTION 3.  Effective January 1, 2031, the following   sections are repealed:                (1)  Section 12.005, Business Organizations Code;                (2)  Section 171.0005, Tax Code; and                (3)  Section 171.001(d), Tax Code.          SECTION 4.  The following provisions are repealed:                (1)  Section 3, Chapter 859 (S.B. 938), Acts of the 87th   Legislature, Regular Session, 2021, as effective January 1, 2026,   which amended Section 171.0001(4), Tax Code;                (2)  Section 7, Chapter 859 (S.B. 938), Acts of the 87th   Legislature, Regular Session, 2021, as effective January 1, 2026,   which amended Section 171.063(g), Tax Code; and                (3)  Section 9, Chapter 859 (S.B. 938), Acts of the 87th   Legislature, Regular Session, 2021, as effective January 1, 2026,   which provided for the repeal of Section 12.005, Business   Organizations Code, and Sections 171.0005, 171.001(d), and   171.204(d), Tax Code.          SECTION 5.  Except as otherwise provided by this Act, this   Act takes effect September 1, 2025.