85R5095 ADM-F     By: Oliveira H.B. No. 2833       A BILL TO BE ENTITLED   AN ACT   relating to a tax refund or credit for wages paid to certain   employees.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 111.109, Tax Code, is amended to read as   follows:          Sec. 111.109.  TAX REFUND FOR WAGES PAID TO CERTAIN   EMPLOYEES [EMPLOYEE RECEIVING AID TO FAMILIES WITH DEPENDENT   CHILDREN].  (a) In this section:                (1)  "Taxable entity" has the meaning assigned by   Section 171.0002.                (2)  "Wages" has the meaning assigned by Section   171.9261.          (b)  This section applies only to a person that is not a   taxable entity or that is a taxable entity but does not owe any tax   for a regular annual period because of the application of Section   171.002(d)(2).          (c)  Subject to the limitations and conditions prescribed by   this section, a person to which this section applies is entitled to   a refund of each tax the person paid to this state that is   administered by the comptroller the revenue of which is not   constitutionally dedicated and all or part of which is deposited to   the credit of the general revenue fund.          (d)  A person may receive a refund under this section only if   the person:                (1)  paid or incurred wages for an employee who meets   the requirements under Section 171.9263(a);                (2)  requests and receives in accordance with Section   171.9264 certification from the Texas Workforce Commission that the   employee meets the requirements under Section 171.9263(a);                (3)  files an application with the comptroller for the   refund using a form promulgated by the comptroller; and                (4)  as a taxable entity, has not claimed a credit in   relation to those wages on a franchise tax report under Subchapter   W, Chapter 171.          (e)  The amount of the refund to which a person is entitled in   relation to each employee is equal to the amount prescribed by   Section 171.9265(a) or (b), as appropriate.          (f)  The total refund to which a person is entitled during a   calendar year may not exceed the total amount of taxes described by   Subsection (c) that the person paid to the state during that   calendar year, after any other applicable credits.          (g)  A person may not convey, assign, or transfer the right   to a refund allowed under this section to another person unless all   of the assets of the person, or of a discrete unit of the person that   paid or incurred the wages, are sold, conveyed, assigned, or   transferred in the same transaction or in a related transaction, to   a person that directly or indirectly owns, controls, or otherwise   directs, wholly or partly, an interest in the person from which the   right to the refund is conveyed, assigned, or transferred.          (h)  The comptroller shall adopt rules necessary to   administer this section [The comptroller shall issue a refund for a   tax paid by a person to this state in the amount of a tax refund   voucher issued by the Texas Workforce Commission under Subchapter   H, Chapter 301, Labor Code, subject to the provisions of that   subchapter].          SECTION 2.  Chapter 171, Tax Code, is amended by adding   Subchapter W to read as follows:   SUBCHAPTER W. TAX CREDIT FOR WAGES PAID TO CERTAIN EMPLOYEES          Sec. 171.9261.  DEFINITIONS. In this subchapter:                (1)  "Commission" means the Texas Workforce   Commission.                (2)  "Wages" means payments described by Sections   51(c)(1), (2), and (3), Internal Revenue Code of 1986.          Sec. 171.9262.  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. 171.9263.  QUALIFICATION. (a)  A taxable entity   qualifies for a credit under this subchapter for the wages paid or   incurred by the taxable entity for an employee only if the   commission certifies under Section 171.9264 that the employee is:                (1)  a resident of this state; and                (2)  a member of one of the following federal work   opportunity tax credit targeted groups:                      (A)  a qualified IV-A recipient, as defined by   Section 51(d)(2), Internal Revenue Code of 1986, in effect for the   federal tax year beginning January 1, 2018, and any regulations   adopted under that code applicable to that period;                      (B)  a qualified veteran, as defined by Section   51(d)(3), Internal Revenue Code of 1986, in effect for the federal   tax year beginning January 1, 2018, and any regulations adopted   under that code applicable to that period;                      (C)  a qualified supplemental nutrition   assistance program benefits recipient, as defined by Section   51(d)(8), Internal Revenue Code of 1986, in effect for the federal   tax year beginning January 1, 2018, and any regulations adopted   under that code applicable to that period; or                      (D)  a long-term family assistance recipient, as   defined by Section 51(d)(10), Internal Revenue Code of 1986, in   effect for the federal tax year beginning January 1, 2018, and any   regulations adopted under that code applicable to that period.          (b)  A taxable entity is not eligible for a credit on a report   against the tax imposed under this chapter for wages paid or   incurred during the period on which the report is based if the   taxable entity, or a member of the combined group if the taxable   entity is a combined group, received a refund in relation to those   wages under Section 111.109.          Sec. 171.9264.  CERTIFICATION BY COMMISSION. (a) A taxable   entity must request certification from the commission for each   employee not later than the 28th day after the date the employee   begins employment with the taxable entity.          (b)  The commission shall issue a certification to a taxable   entity for each employee the commission determines meets the   requirements under Section 171.9263(a).          (c)  The commission shall forward each certification to the   comptroller.          Sec. 171.9265.  AMOUNTS; LIMITATION. (a) The amount of the   credit in relation to each employee described by Section   171.9263(a)(2)(A), (B), or (D) is equal to 20 percent of the first   $10,000 in total wages paid or incurred by the taxable entity for   that employee beginning on the date the employee begins employment   and ending on the anniversary of that date.          (b)  The amount of the credit in relation to each employee   described by Section 171.9263(a)(2)(C) is equal to 10 percent of   the first $10,000 in total wages paid or incurred by the taxable   entity for that employee beginning on the date the employee begins   employment and ending on the anniversary of that date.          (c)  The total credit claimed under this subchapter for a   report, including the amount of any carryforward credit under   Section 171.9266, may not exceed the amount of tax due for the   report after any other applicable credits.          Sec. 171.9266.  CARRYFORWARD. (a) If a taxable entity is   eligible for a credit that exceeds the limitation under Section   171.9265(c), the taxable entity 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 171.9265(c).          Sec. 171.9267.  APPLICATION FOR CREDIT. (a) A taxable   entity must apply for a credit under this subchapter on or with the   tax report for the period for which the credit is claimed.          (b)  The comptroller shall promulgate a form for the   application for the credit. A taxable entity must use the form in   applying for the credit.          Sec. 171.9268.  ASSIGNMENT PROHIBITED. A taxable entity may   not convey, assign, or transfer a credit allowed under this   subchapter to another entity unless all of the assets of the taxable   entity, or of a discrete unit of the taxable entity that paid or   incurred the wages, are sold, conveyed, assigned, or transferred in   the same transaction or in a related transaction, to a taxable   entity that directly or indirectly owns, controls, or otherwise   directs, wholly or partly, an interest in the taxable entity from   which the credit is conveyed, assigned, or transferred.          Sec. 171.9269.  RULES. The comptroller and the commission   shall adopt rules necessary to administer this subchapter.          SECTION 3.  Section 19.011(a), Education Code, is amended to   read as follows:          (a)  In order to achieve the goals stated in Section 19.003,   the district with the cooperation of the Health and Human Services   Commission, the Texas Workforce Investment Council, the Texas   Workforce Commission, the Texas Economic Development and Tourism   Office, and the department shall provide persons confined or   imprisoned in the department:                (1)  information from local workforce [and]   development boards on job training and employment referral   services; and                (2)  information on the tax refund [voucher] program   under Section 111.109, Tax Code, and the franchise tax credit   program under Subchapter W, Chapter 171, Tax [H, Chapter 301,   Labor] Code.          SECTION 4.  Section 301.0671, Labor Code, is amended to read   as follows:          Sec. 301.0671.  FEDERAL WORK OPPORTUNITY TAX CREDIT AND   STATE TAX REFUND OR CREDIT FOR CERTAIN EMPLOYERS. (a) The   commission is the lead agency in promoting awareness of the federal   work opportunity tax credit program and the state tax refund or   credit for employers under Section 111.109, Tax Code, and    Subchapter W, Chapter 171, Tax Code [H].          (b)  The commission, in coordination with the comptroller's   office and the Health and Human Services Commission [Texas   Department of Human Services], shall develop and distribute   educational materials designed to increase awareness of the tax   [credit and tax] refund and credits described by Subsection (a) [to   encourage employers to hire recipients of the financial assistance   program for persons with dependent children under Chapter 31, Human   Resources Code].          SECTION 5.  Section 306.007(a), Labor Code, is amended to   read as follows:          (a)  To assist in the reintegration into the labor force of   persons formerly sentenced to the correctional institutions   division or committed to the Texas Juvenile Justice Department, the   commission through Project RIO shall provide:                (1)  to those persons:                      (A)  information from local workforce development   boards on job training and employment referral services;                      (B)  information from the Department of State   Health Services on substance abuse treatment services;                      (C)  information from the Texas Department of   Housing and Community Affairs on housing services;                      (D)  information from the Texas Veterans   Commission on services for veterans; and                      (E)  information on the tax refund program under   Section 111.109, Tax Code, and the franchise tax credit program    [voucher programs] under Subchapter W, Chapter 171, Tax Code [H,   Chapter 301]; and                (2)  to the employers and potential employers of those   persons:                      (A)  information from the Texas Economic   Development and Tourism Office on the enterprise zone program; and                      (B)  information from local workforce development   boards on services listed in Section 2308.304, Government Code.          SECTION 6.  Subchapter H, Chapter 301, Labor Code, is   repealed.          SECTION 7.  The repeal of Subchapter H, Chapter 301, Labor   Code, by this Act does not affect an eligible person's right to   claim a refund of state taxes that was established under Subchapter   H, Chapter 301, Labor Code, before the effective date of this Act.   An eligible person's right to claim a refund of state taxes that was   established under Subchapter H, Chapter 301, Labor Code, before the   effective date of this Act is governed by the law in effect on the   date the right to claim the refund was established, and the former   law is continued in effect for that purpose.          SECTION 8.  This Act applies only to a report originally due   on or after the effective date of this Act.          SECTION 9.  This Act takes effect January 1, 2018.