The 80th Texas Legislature

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The 80th Texas Legislature

• Plans and Surprises

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Thanks to TSCPA Volunteers

• Special thanks to Sweeten Harris
• LAC
• HB 3 Task Force
• LAEC
• LRC
• KEY PERSONS
• CPA-PAC

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TSCPA Legislative Agenda

• Interstate Practice
• Privacy Policy Relief
• Margin Tax Recommendations

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The Lay of the Land

• Governor Perry Steps Out
• Lt. Gov. Dewhurst in the penalty box
• King Craddick?

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(No Transcript)
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The Numbers
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Privacy Policy Relief

• HB 863 by Cook/Ellis
• Signed by the Governor
• Effective Date September 1, 2007

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Interstate Practice

• HB 2144 by Flores/Williams
• Signed by the Governor
• Effective Date September 1, 2007
• License Required for Texas Audits
• Equivalent CPAs No Notice
• CPAs Subject to Texas Law TSBPA
• Ownership and Peer Review Apply

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Margin Tax Legislation

• Numerous Tax Bills Filed
• Revenue Neutral Requirement
• Comptrollers Revenue Estimate
• HB 3928 HB 1207 Passed
• 12 of 27 TSCPA Suggestions Accepted

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Major Rejections

• Flow-Through Funds
• Independent Contractor Deduction
• Personal Service Corp. Deduction

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Clarifications

• LLPs are taxable
• Deductions must be FIT deductible
• Natural persons include estates
• Eliminate FLP provisions
• IRC 401(a) and 501(c)(9) trusts are non-taxable
  entities
• Commodities, securities and capital gains are
  passive income

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Small Business Discount
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More Small Business Benefits

• .575 Alternative Tax
• Health Insurance Bonus Deductions
• 50 First Year
• 25 Second Year

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Combined Reporting

• Joyce vs. Finnegan
• More Than 50
• 70 Maximum Applies
• Same Tax Periods
• Joint and Several Liability
• 300,000 Max Cash Compensation

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Dates

• Franchise Tax due after June 30, 2007
• COGS vs. Compensation Election must be made by
  due date of return

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Line References Corrected

• Gross Rents for Partnerships
• Guaranteed Payments Corrected
• Must Comply with FIT

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Temporary Credit

• 4.5 of business loss carry forward
• 2.25 first ten years
• 7.75 second ten years

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Surprises

• Texas Accounting Principles
• Tax Collections and Liabilities
• Property Tax Consulting Prohibition
• Licenses for Convicted Felons
• SDSI Extension to 2013
• Head Tax Exemptions

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Other Tax Measures

• TIF Repeal
• 10 Appraisal Cap for Residences
• Sex Club Tax

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Whats Official in Texas

• The Bolo tie is the official tie
• The Cowboy boot is the official shoe
• Silver is the official precious metal
• Athens Home of the hamburger
• Friona Cheeseburger Capital of Texas
• Lewisville Lake Urban Bass Fishing Capital of
  Texas
• Robstown Birthplace of Texas HoldEm
• The Salamander Sinks