The bill, H.B. No. 3994, proposes amendments to the Texas Tax Code regarding the computation of tax penalties and interest amounts. It introduces new provisions that clarify how to calculate interest and penalties by specifying that the amounts due should be determined after deducting any overpayments made by the taxpayer for the same tax. Specifically, Subsection (e) of Section 111.060 and Subsection (d) of Section 111.061 are added to define the amount of delinquent tax and tax due, respectively, as the remaining balance after accounting for overpayments for the same or preceding periods.

Additionally, the bill amends Section 111.064 to clarify the interest calculation on refunds, stating that the amount of an overpayment or erroneous payment is determined after deducting any underpayments. It also modifies Section 151.508 to require the comptroller to offset overpayments against underpayments, penalties, and interest accrued. The bill emphasizes that these amendments serve as clarifications of existing law rather than changes, ensuring consistency in the interpretation of tax regulations. The act is set to take effect immediately upon receiving a two-thirds vote from both houses or on September 1, 2025, if that vote is not achieved.

Statutes affected:
Introduced: Tax Code 111.060, Tax Code 111.061, Tax Code 111.064, Tax Code 151.508 (Tax Code 111, Tax Code 151)