The bill, S.B. No. 1231, proposes the addition of Subchapter N to Chapter 171 of the Texas Tax Code, establishing a franchise tax credit for taxable entities that purchase specific theft deterrent and property loss prevention equipment. The new legal language outlines the entitlement to the credit, qualifications for eligibility, the amount of the credit, limitations on its use, and the process for applying for the credit. Taxable entities can claim a credit equal to the costs incurred for eligible equipment purchases, with a cap on the total credit that can be claimed in a reporting period. Additionally, any unused credit can be carried forward for up to five consecutive reports.

The bill also includes provisions that prohibit the assignment or transfer of the credit to another entity unless a substantial portion of the assets is transferred in the same transaction. The comptroller is tasked with adopting rules to implement the subchapter, including maintaining a list of eligible equipment. The act is set to take effect on January 1, 2026, and applies only to reports due on or after that date.

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