H.B. No. 2476
 
 
 
 
AN ACT
  relating to the appraisal for ad valorem tax purposes of certain
  dealer's heavy equipment inventory; providing penalties.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Sections 23.1241(a)(1), (2), (6), (7), (8), and
  (9), Tax Code, are amended to read as follows:
               (1)  "Dealer" means a person engaged in the business in
  this state of selling, leasing, or renting heavy equipment.
               (2)  "Dealer's heavy equipment inventory" means all
  items of heavy equipment that a dealer holds for sale, lease, or
  rent during a 12-month period [at retail]. [The term includes items
  of heavy equipment that are leased or rented but subject to a
  purchase option by the lessee or renter.]
               (6)  "Heavy equipment" means self-propelled,
  self-powered, or pull-type equipment, including farm equipment or a
  diesel engine, that weighs at least 1,500 [3,000] pounds and is
  intended to be used for agricultural, construction, industrial,
  maritime, mining, or forestry uses. The term does not include a
  motor vehicle that is required by:
                     (A)  Chapter 501, Transportation Code, to be
  titled; or
                     (B)  Chapter 502, Transportation Code, to be
  registered.
               (7)  "Sales price" means:
                     (A)  the total amount of money paid or to be paid
  to a dealer for the purchase of an item of heavy equipment; or
                     (B)  for a lease or rental [with an option to
  purchase], the total amount of the lease or rental payments [plus
  any final consideration, excluding interest].
               (8)  "Subsequent sale" means a dealer-financed sale of
  an item of heavy equipment that, at the time of the sale, has been
  the subject of a dealer-financed sale from the same dealer's heavy
  equipment inventory in the same calendar year. The term does not
  include a rental or lease with an unexercised purchase option or
  without a purchase option.
               (9)  "Total annual sales" means the total of the:
                     (A)  sales price for each sale from a dealer's
  heavy equipment inventory in a 12-month period; and
                     (B)  lease and rental payments received for each
  lease or rental of heavy equipment inventory in a 12-month period.
         SECTION 2.  Section 23.1241, Tax Code, is amended by
  amending Subsections (b), (e), and (j) and adding Subsection (b-1)
  to read as follows:
         (b)  For the purpose of the computation of property tax,[:
               [(1)]  the market value of a dealer's heavy equipment
  inventory on January 1 is the total annual sales, less sales to
  dealers, fleet transactions, and subsequent sales, for the 12-month
  period corresponding to the preceding tax year, divided by 12[; and
               [(2)     a sale is considered to occur when possession of
  an item of heavy equipment is transferred from the dealer to the
  purchaser].
         (b-1)  For the purpose of the computation of property tax on
  the market value of the dealer's heavy equipment inventory, the
  sales price of an item of heavy equipment that is sold during the
  preceding tax year after being leased or rented for a portion of
  that same tax year is considered to be the sum of the sales price of
  the item plus the total lease and rental payments received for the
  item in the preceding tax year.
         (e)  A dealer is presumed to be an owner of a dealer's heavy
  equipment inventory on January 1 if, in the 12-month period ending
  on December 31 of the preceding year, the dealer sold, leased, or
  rented an item of heavy equipment to a person other than a dealer.
  The presumption is not rebutted by the fact that a dealer has no
  item of heavy equipment physically on hand for sale from the
  dealer's heavy equipment inventory on January 1.
         (j)  In addition to other penalties provided by law, a dealer
  who fails to file or fails to timely file a declaration required by
  Subsection (f) shall forfeit a penalty.  A tax lien attaches to the
  dealer's business personal property to secure payment of the
  penalty.  The appropriate district attorney, criminal district
  attorney, or county attorney may [shall] collect the penalty
  established by this section in the name of the [chief appraiser or]
  collector.  The chief appraiser may collect the penalty in the name
  of the chief appraiser. The chief appraiser or the appropriate
  district attorney, criminal district attorney, or county attorney
  may sue to enforce compliance with this section. Venue of an action
  brought under this subsection, including an action for injunctive
  relief, is in the county in which the violation occurred or in the
  county in which the owner maintains the owner's principal place of
  business or residence.  The court may award attorney's fees to a
  chief appraiser, district attorney, criminal district attorney, or
  county attorney who prevails in a suit to collect a penalty or
  enforce compliance with this section. A penalty forfeited under
  this subsection is $1,000 for each month or part of a month in which
  a declaration is not filed or timely filed after it is due.
         SECTION 3.  Sections 23.1242(b), (d), (e), (f), and (m), Tax
  Code, are amended to read as follows:
         (b)  Except for an item of heavy equipment sold to a dealer,
  an item of heavy equipment included in a fleet transaction, [or] an
  item of heavy equipment that is the subject of a subsequent sale, or
  an item of heavy equipment that is subject to a lease or rental, an
  owner or a person who has agreed by contract to pay the owner's
  current year property taxes levied against the owner's heavy
  equipment inventory shall assign a unit property tax to each item of
  heavy equipment sold from a dealer's heavy equipment inventory.  In
  the case of a lease or rental, the owner shall assign a unit
  property tax to each item of heavy equipment leased or rented.  The
  unit property tax of each item of heavy equipment is determined by
  multiplying the sales price of the item or the monthly lease or
  rental payment received for the item, as applicable, by the unit
  property tax factor.  If the transaction is a lease or rental, the
  owner shall collect the unit property tax from the lessee or renter
  at the time the lessee or renter submits payment for the lease or
  rental. The owner of the equipment shall state the amount of the
  unit property tax assigned as a separate line item on an invoice.
  On or before the 10th day of each month the owner shall, together
  with the statement filed by the owner as required by this section,
  deposit with the collector an amount equal to the total of unit
  property tax assigned to all items of heavy equipment sold, leased,
  or rented from the dealer's heavy equipment inventory in the
  preceding month to which a unit property tax was assigned.  The
  money shall be deposited by the collector to the credit of the
  owner's escrow account for prepayment of property taxes as provided
  by this section.  An escrow account required by this section is used
  to pay property taxes levied against the dealer's heavy equipment
  inventory, and the owner shall fund the escrow account as provided
  by this subsection.
         (d)  Except as provided by Section 23.1243, the [The] owner
  may not withdraw funds in an escrow account created under this
  section.
         (e)  The comptroller by rule shall adopt a dealer's heavy
  equipment inventory tax statement form.  Each month, a dealer shall
  complete the form regardless of whether an item of heavy equipment
  is sold, leased, or rented.  A dealer may use no other form for that
  purpose.  The statement may include the information the comptroller
  considers appropriate but shall include at least the following:
               (1)  a description of each item of heavy equipment
  sold, leased, or rented including any unique identification or
  serial number affixed to the item by the manufacturer;
               (2)  the sales price of or lease or rental payment
  received for the item of heavy equipment, as applicable;
               (3)  the unit property tax of the item of heavy
  equipment, if any; and
               (4)  the reason no unit property tax is assigned if no
  unit property tax is assigned.
         (f)  On or before the 10th day of each month, a dealer shall
  file with the collector the statement covering the sale, lease, or
  rental of each item of heavy equipment sold, leased, or rented by
  the dealer in the preceding month.  On or before the 10th day of a
  month following a month in which a dealer does not sell, lease, or
  rent an item of heavy equipment, the dealer must file the statement
  with the collector and indicate that no sales, leases, or rentals
  were made in the prior month.  A dealer shall file a copy of the
  statement with the chief appraiser and retain documentation
  relating to the disposition of each item of heavy equipment sold and
  the lease or rental of each item of heavy equipment.  A chief
  appraiser or collector may examine documents held by a dealer as
  provided by this subsection in the same manner, and subject to the
  same conditions, as provided by Section 23.1241(g).
         (m)  In addition to other penalties provided by law, a dealer
  who fails to file or fails to timely file a statement as required by
  this section shall forfeit a penalty.  A tax lien attaches to the
  dealer's [owner's] business personal property to secure payment of
  the penalty.  The appropriate district attorney, criminal district
  attorney, or county attorney may [shall] collect the penalty
  established by this section in the name of the [chief appraiser or]
  collector.  The chief appraiser may collect the penalty in the name
  of the chief appraiser. The chief appraiser or the appropriate
  district attorney, criminal district attorney, or county attorney
  may sue to enforce compliance with this section. Venue of an action
  brought under this subsection, including an action for injunctive
  relief, is in the county in which the violation occurred or in the
  county in which the owner maintains the owner's principal place of
  business or residence.  The court may award attorney's fees to a
  chief appraiser, district attorney, criminal district attorney, or
  county attorney who prevails in a suit to collect a penalty or
  enforce compliance with this section. A penalty forfeited under
  this subsection is $500 for each month or part of a month in which a
  statement is not filed or timely filed after it is due.
         SECTION 4.  Subchapter B, Chapter 23, Tax Code, is amended by
  adding Section 23.1243 to read as follows:
         Sec. 23.1243.  REFUND OF PREPAYMENT OF TAXES ON FLEET
  TRANSACTION. (a)  In this section, "dealer" and "fleet
  transaction" have the meanings assigned those terms by Section
  23.1241.
         (b)  A dealer may apply to the chief appraiser for a refund of
  the unit property tax paid on a sale that is a fleet transaction.
         (c)  The chief appraiser shall determine whether to approve
  or deny, wholly or partly, the refund requested in the application.
  The chief appraiser shall deliver a written notice of the chief
  appraiser's determination to the collector maintaining the escrow
  account described by Section 23.1242 and to the applicant that
  states the amount, if any, to be refunded.
         (d)  A collector who receives a notice described by
  Subsection (c) stating an amount to be refunded shall pay the amount
  to the dealer not later than the 45th day after the date the
  collector receives the notice. The dealer shall use the dealer's
  best efforts to pay the refund to the customer who paid the tax that
  relates to the fleet transaction for which the refund is requested
  not later than the 30th day after the date the dealer receives the
  refund.
         SECTION 5.  Section 41.44(a), Tax Code, is amended to read as
  follows:
         (a)  Except as provided by Subsections (b), (b-1), (c),
  (c-1), and (c-2), to be entitled to a hearing and determination of a
  protest, the property owner initiating the protest must file a
  written notice of the protest with the appraisal review board
  having authority to hear the matter protested:
               (1)  before May 1 or not later than the 30th day after
  the date that notice to the property owner was delivered to the
  property owner as provided by Section 25.19, if the property is a
  single-family residence that qualifies for an exemption under
  Section 11.13, whichever is later;
               (2)  before June 1 or not later than the 30th day after
  the date that notice was delivered to the property owner as provided
  by Section 25.19 in connection with any other property, whichever
  is later;
               (3)  in the case of a protest of a change in the
  appraisal records ordered as provided by Subchapter A of this
  chapter or by Chapter 25, not later than the 30th day after the date
  notice of the change is delivered to the property owner; [or]
               (4)  in the case of a determination that a change in the
  use of land appraised under Subchapter C, D, E, or H, Chapter 23,
  has occurred, not later than the 30th day after the date the notice
  of the determination is delivered to the property owner; or
               (5)  in the case of a determination of eligibility for a
  refund under Section 23.1243, not later than the 30th day after the
  date the notice of the determination is delivered to the property
  owner.
         SECTION 6.  Section 41.47, Tax Code, is amended by adding
  Subsection (c) to read as follows:
         (c)  If, in the case of a determination of eligibility for a
  refund requested under Section 23.1243, the appraisal review board
  determines that the dealer is entitled to a refund in excess of the
  amount, if any, to which the chief appraiser determined the dealer
  to be entitled, the board shall order the chief appraiser to deliver
  written notice of the board's determination to the collector and
  the dealer in the manner provided by Section 23.1243(c).
         SECTION 7.  Section 42.01, Tax Code, is amended to read as
  follows:
         Sec. 42.01.  RIGHT OF APPEAL BY PROPERTY OWNER. A property
  owner is entitled to appeal:
               (1)  an order of the appraisal review board
  determining:
                     (A)  a protest by the property owner as provided
  by Subchapter C of Chapter 41; [or]
                     (B)  a determination of an appraisal review board
  on a motion filed under Section 25.25; or
                     (C)  a determination of an appraisal review board
  of eligibility for a refund requested under Section 23.1243; or
               (2)  an order of the comptroller issued as provided by
  Subchapter B, Chapter 24, apportioning among the counties the
  appraised value of railroad rolling stock owned by the property
  owner.
         SECTION 8.  Sections 23.1241(i) and 23.1242(l), Tax Code,
  are repealed.
         SECTION 9.  This Act applies only to ad valorem taxes imposed
  for a tax year beginning on or after the effective date of this Act.
         SECTION 10.  This Act takes effect January 1, 2012.
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
 
         I certify that H.B. No. 2476 was passed by the House on April
  27, 2011, by the following vote:  Yeas 148, Nays 0, 2 present, not
  voting; and that the House concurred in Senate amendments to H.B.
  No. 2476 on May 21, 2011, by the following vote:  Yeas 141, Nays 0,
  3 present, not voting.
 
  ______________________________
  Chief Clerk of the House   
 
         I certify that H.B. No. 2476 was passed by the Senate, with
  amendments, on May 19, 2011, by the following vote:  Yeas 31, Nays
  0.
 
  ______________________________
  Secretary of the Senate   
  APPROVED: __________________
                  Date       
   
           __________________
                Governor