SB1781 - Relating to a franchise tax credit for taxable entities that provide child care.

  89R8401 SRA-D     By: Miles S.B. No. 1781       A BILL TO BE ENTITLED   AN ACT   relating to a franchise tax credit for taxable entities that   provide child care.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Chapter 171, Tax Code, is amended by adding   Subchapter V to read as follows:   SUBCHAPTER V.     TAX CREDIT FOR PROVISION OF CHILD CARE           Sec.   171.9241.     DEFINITION. In this subchapter, "employee"   means an individual who performs services for an employer for   compensation under an oral or written contract of hire, whether   express or implied.   The term does not include an independent   contractor.           Sec.   171.9242.     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.   171.9243.     QUALIFICATION. A taxable entity qualifies   for a credit under this subchapter if the taxable entity subsidizes   all or a portion of the entity's employees' costs for child care at:                 (1)     a licensed child-care center operated by the   entity; or                 (2)     a licensed commercial or home-based child-care   center.           Sec.   171.9244.     AMOUNT OF CREDIT.   The amount of a taxable   entity's credit for a report is equal to the lesser of:                 (1)     the amount of the costs attributable to   subsidizing employee child care in the manner described by Section   171.9243 during the period on which the report is based; or                 (2)     the amount equal to 1.5 percent of the franchise   tax due for the report after applying all other applicable credits.           Sec.   171.9245.     APPLICATION FOR CREDIT.   (a)   A taxable   entity must apply for a credit under this subchapter on or with the   report for which the credit is claimed.           (b)     A taxable entity must apply for the credit in the manner   prescribed by the comptroller and include with the application any   information requested by the comptroller to determine whether the   entity is eligible for the credit under this subchapter.           Sec.   171.9246.     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.   171.9247.     RULES.   The comptroller shall adopt rules   necessary to implement and administer this subchapter.          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.