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(a)Effective date. For reports originally due on or after January 1, 2008, the additional tax imposed by Tax Code, §171.0011, applies to a taxable entity which no longer has sufficient nexus with Texas to be subject to the franchise tax. All provisions of Tax Code, Chapter 171, apply to the additional tax, unless they conflict with a provision in Tax Code, §171.0011. (b)Due date. A final report and payment of the additional tax are due within 60 days after the taxable entity no longer has sufficient nexus with Texas to be subject to the franchise tax. However, an estimated return and payment may need to be filed and paid before a taxable entity will receive clearance from the comptroller to terminate, dissolve, merge, or withdraw. As long as the proper amount is paid and an amended return, if needed, is filed within 60 days after the taxable entity terminates, dissolves, merges, or withdraws, then no penalty or interest will be assessed. (c)Rate and business based on. The additional tax rate is determined by Tax Code, §171.002 and is applied to taxable margin for the period from the day after the last day for which tax under Tax Code, Chapter 171, was based on a previous report through the date the taxable entity no longer has sufficient nexus with Texas to be subject to the franchise tax. (d)Passive entities. See §3.582(g) of this title (relating to Margin: Passive Entities) and Tax Code, §171.001(c). A passive entity must file a final report when the entity is no longer subject to the tax. If the entity has been a passive entity since the last report filed, no tax would be due with the report. (e)Combined reports. See §3.590 of this title (relating to Margin: Combined Reporting). An entity that is part of a combined report must file a final report when the entity is no longer subject to the tax to tell the comptroller the name of the reporting entity. No financial data would be included on the report, unless the entity becoming no longer subject to the tax is the reporting entity.
This agency hereby certifies that the adoption has
been reviewed by legal counsel and found to be a valid exercise of
the agency's legal authority.
Filed with the Office
of the Secretary of State on December 11, 2007
TRD-200706274 Martin Cherry
General Counsel
Comptroller of Public
Accounts
Effective date: January 1, 2008
Proposal publication date: September 14, 2007
For further information, please call: (512) 475-0387
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