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TAX CODE

TITLE 2. STATE TAXATION

SUBTITLE B. ENFORCEMENT AND COLLECTION

CHAPTER 111. COLLECTION PROCEDURES

SUBCHAPTER A. COLLECTION DUTIES AND POWERS

Sec. 111.001. COMPTROLLER TO COLLECT TAXES. The comptroller

shall collect the taxes imposed by this title except as otherwise

provided by this title.

Acts 1981, 67th Leg., p. 1495, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.002. COMPTROLLER'S RULES; COMPLIANCE; FORFEITURE. (a)

The comptroller may adopt rules that do not conflict with the

laws of this state or the constitution of this state or the

United States for the enforcement of the provisions of this title

and the collection of taxes and other revenues under this title.

In addition to the discretion to adopt, repeal, or amend such

rules permitted under the constitution and laws of this state and

under the common law, the comptroller may adopt, repeal, or amend

such rules to reflect changes in the power of this state to

collect taxes and enforce the provisions of this title due to

changes in the constitution or laws of the United States and

judicial interpretations thereof.

(b) A person who does not comply with a rule made under this

section forfeits to the state an amount of not less than $25 nor

more than $500. Each day on which a failure to comply occurs or

continues is a separate violation.

(c) If a forfeiture is not paid, the attorney general shall file

suit to recover the forfeiture in a court of competent

jurisdiction in Travis County or in any other county where venue

lies.

(d) Any other provision of this code that imposes a different

penalty for the violation of a comptroller's rule made for the

enforcement or collection of a specific tax imposed by this title

prevails over the penalty provided by this section.

Acts 1981, 67th Leg., p. 1495, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1989, 71st Leg., ch. 231, Sec. 2, eff. Aug.

28, 1989.

Sec. 111.0021. APPLICATION TO OTHER TAXES AND FEES. This

chapter also applies to a tax or fee that the comptroller is

required to collect under a law not included in this title.

Added by Acts 1991, 72nd Leg., ch. 705, Sec. 1, eff. Sept. 1,

1991.

Sec. 111.0022. APPLICATION TO OTHER LAWS ADMINISTERED BY

COMPTROLLER. This subtitle and Subtitle A of this title apply to

the administration, collection, and enforcement of other taxes,

fees, and charges, including penalties, or other financial

transactions, that the comptroller is required or authorized to

collect or administer under other law, to the extent that the

other law does not conflict with this subtitle or Subtitle A of

this title.

Added by Acts 1993, 73rd Leg., ch. 486, Sec. 1.02, eff. Sept. 1,

1993.

Sec. 111.003. COMPTROLLER'S INVESTIGATIONS. (a) On the

governor's request, the comptroller shall:

(1) investigate the books and accounts of assessing and

collecting officers of the state and other officers or persons

receiving, disbursing, or possessing public funds;

(2) perform other duties and make investigations in relation to

public funds as requested by the governor; and

(3) investigate any state institution and its policies,

management, and operation, including the fiscal affairs and the

conduct and efficiency of any state employee of the institution.

(b) The comptroller shall report to the governor the results of

an investigation requested under Subsection (a) of this section.

The report must be written and include:

(1) a description of each violation of the revenue laws;

(2) a description of the failure, if any, to enforce revenue

laws;

(3) the name of each person reasonably believed to have

committed a violation or to have been guilty of nonfeasance; and

(4) if a state institution is investigated, a description of the

expenditures of the institution and of all sums of money due the

state, the ascertainment and collection of which does not devolve

upon other officers of the state under existing law.

(c) A person connected with the public service shall submit all

books, records, and accounts to the comptroller without delay on

the request of the comptroller when conducting an investigation

under Subsection (a) of this section.

(d) On the receipt of a report that indicates a violation of

revenue laws or neglect of duty, the governor shall notify the

attorney general, who shall institute criminal and civil

proceedings in the name of the state against persons accused of a

violation or neglect of duty.

(e) The comptroller may at any time examine and investigate the

expenditure of appropriated money for a state institution or for

any other purpose or for improvements made by the state on state

property or money received and disbursed by any board authorized

to receive and disburse state money. The comptroller shall

investigate any state institution when required by information

coming to his own knowledge.

Acts 1981, 67th Leg., p. 1495, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0034. ADVANCED DATABASE SYSTEM FOR AUDITS. (a) The

comptroller shall develop an advanced electronic audit database

system for use by the comptroller's audit division. The system

must:

(1) centralize management of audit transaction data;

(2) enhance the quality control of data; and

(3) be compatible with other data systems of the state.

(b) The comptroller may contract with a vendor to develop or

implement the system.

(c) If the comptroller contracts with a vendor to develop or

implement the system, the comptroller must protect any

confidential information provided to the vendor. A person who

receives confidential information under this section and each

employee or agent of that person is subject to the same

prohibitions against disclosure of the information, and the same

penalties and sanctions for improper disclosure, that apply to

the comptroller.

Added by Acts 2001, 77th Leg., ch. 1272, Sec. 5.01, eff. June 15,

2001.

Sec. 111.0035. ADVANCED DATABASE SYSTEM FOR TAX COLLECTIONS.

(a) The comptroller may contract with an appropriate vendor to

develop and implement an advanced database system to enhance tax

collections.

(b) Subject to Subsection (c), the total amount of compensation

paid to the vendor that develops, implements, and maintains the

advanced database system is equal to the product of:

(1) the percentage stated in the contract; and

(2) the amount of revenue collected from taxpayers by the

comptroller, after all available administrative and judicial

appeals are exhausted, as a result of audit and enforcement

actions taken on cases identified from the system.

(c) The amount of compensation paid to a vendor under Subsection

(b) may not exceed the maximum amount, if any, stated in the

contract between the comptroller and the vendor.

(d) The comptroller may pay compensation to a vendor under this

section periodically at the times specified in the contract

between the comptroller and the vendor. The comptroller shall

determine the amount of a periodic payment in accordance with

Subsections (b) and (c). In computing the amount under Subsection

(b)(2), the comptroller may include a case only if the case:

(1) becomes administratively final during the period covered by

the payment; and

(2) is not the subject of litigation at the end of that period.

(e) The comptroller may pay a vendor under this section only

through warrants issued or electronic funds transfers initiated

by the comptroller. The comptroller shall account for the

compensation as a subtraction from tax collections and not as a

general expense of the comptroller.

(f) Except as provided by Subsection (g), the comptroller shall

award a contract made under this section through a competitive

bidding process that complies with Section 2155.132, Government

Code. If the comptroller receives not more than three bids

through the competitive bidding process, the comptroller shall

report the number of bidders to the Legislative Budget Board

before awarding the contract.

(g) The comptroller may enter into separate contracts with

additional appropriate vendors willing and able to develop and

implement an advanced database system to enhance tax collections

at the same rate and under the same terms and conditions as the

contract awarded through competitive bidding.

(h) Except as specifically provided by this section, the

comptroller may include any term or condition in a contract made

under this section that the comptroller considers necessary or

advisable to maximize enhancement of tax collections while

otherwise protecting the state's interests.

(i) The comptroller shall report semiannually to the Legislative

Budget Board the:

(1) amount of revenue collected under this section; and

(2) amount of compensation awarded to a vendor under this

section.

(j) A person acting on behalf of this state under a contract

authorized by this section does not exercise any of the sovereign

power of this state, except that the person is an agent of this

state for purposes of developing and implementing an advanced

database system to enhance tax collections.

(k) The comptroller may provide to a person acting on behalf of

this state under a contract authorized by this section any

confidential information in the custody of the comptroller that

is necessary to develop and implement an advanced database system

to enhance tax collections and that the comptroller is not

prohibited from sharing under an agreement with another state or

the federal government. A person who receives confidential

information under this subsection and each employee or agent of

that person is subject to each prohibition against disclosure of

the information that applies to the comptroller or an employee of

the comptroller. A person, employee, or agent who receives

confidential information under this subsection and improperly

discloses that information is subject to the same penalties and

sanctions that would apply to the comptroller or an employee of

the comptroller for that disclosure.

Added by Acts 1997, 75th Leg., ch. 927, Sec. 1, eff. Sept. 1,

1997. Amended by Acts 2001, 77th Leg., ch. 1272, Sec. 5.02, eff.

June 15, 2001.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.108, eff. September 1, 2007.

Sec. 111.0036. OUT-OF-STATE AUDITS. (a) The comptroller may

contract with one or more appropriate persons to perform tax

audits in any state that is not covered by a comptroller field

office. A contract may provide for a person to perform tax audits

in more than one state.

(b) Subject to Subsection (c), the amount of compensation paid

to a person performing tax audits under this section is equal to

the product of:

(1) the percentage stated in the contract between the

comptroller and the person; and

(2) the amount of revenue collected from taxpayers by the

comptroller, after all available administrative and judicial

appeals are exhausted, as a result of those audits.

(c) The maximum percentage rate stated in a contract may not

exceed 12 percent. In addition, the amount of compensation paid

to a person under Subsection (b) may not exceed the maximum

amount, if any, stated in the contract between the comptroller

and the person.

(d) The comptroller may pay compensation to a person under this

section periodically at the times specified in the contract

between the comptroller and the person. The comptroller shall

determine the amount of a periodic payment in accordance with

Subsections (b) and (c). In computing the amount under Subsection

(b)(2), the comptroller may include a case only if the case:

(1) becomes administratively final during the period covered by

the payment; and

(2) is not the subject of litigation at the end of that period.

(e) The comptroller may pay a person under this section only

through warrants issued or electronic funds transfers initiated

by the comptroller. The comptroller shall account for the

compensation as a subtraction from tax collections and not as a

general expense of the comptroller.

(f) Except as provided by Subsection (g), the comptroller shall

award a contract made under this section through a competitive

bidding process that complies with Section 2155.132, Government

Code. If the comptroller receives not more than three bids

through the competitive bidding process, the comptroller shall

report the number of bidders to the Legislative Budget Board

before awarding the contract.

(g) The comptroller may enter into separate contracts with

additional appropriate persons willing and able to perform tax

audits in other states that are not covered by comptroller field

offices at the same rate and under the same terms and conditions

as the contract awarded through competitive bidding.

(h) The comptroller shall report semiannually to the Legislative

Budget Board the:

(1) amount of revenue collected under this section; and

(2) amount of compensation awarded to a person with whom the

comptroller contracts under this section.

(i) A person acting on behalf of this state under a contract

authorized by this section does not exercise any of the sovereign

power of this state, except that the person is an agent of this

state for purposes of performing tax audits.

(j) The comptroller may provide to a person acting on behalf of

this state under a contract authorized by this section any

confidential information in the custody of the comptroller

relating to a taxpayer that is necessary to the audit of the

taxpayer and that the comptroller is not prohibited from sharing

under an agreement with another state or the federal government.

A person who receives confidential information under this

subsection and each employee or agent of that person are subject

to each prohibition against disclosure of confidential

information obtained from a taxpayer or this state in connection

with a tax audit that applies to the comptroller or an employee

of the comptroller. A person, employee, or agent who receives

confidential information under this subsection and improperly

discloses that information is subject to the same penalties and

sanctions that would apply to the comptroller or an employee of

the comptroller for that disclosure.

Added by Acts 1997, 75th Leg., ch. 927, Sec. 1, eff. Sept. 1,

1997.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.109, eff. September 1, 2007.

Sec. 111.004. POWER TO EXAMINE RECORDS AND PERSONS. (a) For

the purpose of carrying out the terms of this title the

comptroller may examine at the principal or any other office in

the United States of any person, firm, agent, or corporation

permitted to do business in this state, all books, records and

papers and also any of their officers or employees under oath.

(b) If any person refuses to permit an examination or answer any

question authorized by Subsection (a) of this section, the

comptroller may certify the fact of the refusal to the secretary

of state, who shall immediately forfeit the charter or the permit

to do business of the person until the examination as required is

completed.

(c) No charge may be made by the comptroller to examine a book,

record, or paper or to question an officer or employee.

(d) The comptroller's authority to examine books, records, and

papers under this chapter extends to all books, records, papers,

and other objects which the comptroller determines are necessary

for conducting a complete examination under this title.

Acts 1981, 67th Leg., p. 1496, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0041. RECORDS. (a) Any taxpayer who is required by

this title to keep records shall keep those records open to

inspection by the comptroller, the attorney general, or the

authorized representatives of either of them for four years.

(b) This section prevails over any other conflicting provision

of this title.

Acts 1981, 67th Leg., p. 1496, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1999, 76th Leg., ch. 1467, Sec. 2.11, eff.

Oct. 1, 1999.

Sec. 111.0042. SAMPLING IN AUDITING; PROJECTING ASSESSMENTS.

(a) Repealed by Acts 1983, 68th Leg., p. 982, ch. 234, Sec. 1,

eff. May 25, 1983.

(b) Sampling auditing methods are appropriate if:

(1) the taxpayer's records are so detailed, complex, or

voluminous that an audit of all detailed records would be

unreasonable or impractical;

(2) the taxpayer's records are inadequate or insufficient, so

that a competent audit for the period in question is not

otherwise possible; or

(3) the cost of an audit of all detailed records to the taxpayer

or to the state will be unreasonable in relation to the benefits

derived, and sampling procedures will produce a reasonable

result.

(c) Before using a sample technique to establish a tax

liability, the comptroller or his designee must notify the

taxpayer in writing of the sampling procedure to be used.

(d) The sample must reflect as nearly as possible the normal

conditions under which the business was operated during the

period to which the audit applies. If a taxpayer can demonstrate

that a transaction in a sample period is not representative of

the taxpayer's business operations, the transaction shall be

eliminated from the sample and be separately assessed in the

audit. If records are inadequate to reflect accurately the

business operations of the taxpayer, the comptroller or his

designee shall determine the best information available and base

his audit report on that information.

(e) If the taxpayer demonstrates that any sampling method used

by the comptroller was not in accordance with generally

recognized sampling techniques, the audit will be dismissed as to

that portion of the audit established by projection based upon

the sampling method, and a new audit may be performed.

Acts 1981, 67th Leg., p. 1496, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1983, 68th Leg., p. 982, ch. 234, Sec. 1,

eff. May 25, 1983.

Sec. 111.0043. GENERAL AUDIT AND PREHEARING POWERS. (a) In

this section:

(1) "Person" includes an individual, corporation, partner,

partnership, officer, or director of a corporation, joint

venture, trust, trustee, agent, or association.

(2) "Taxpayer" means the person whose tax obligation the

comptroller is seeking to determine.

(b)(1) Before a determination of or a hearing on a taxpayer's tax

obligation, if any, the comptroller may issue a subpoena

addressed to the sheriff or constable of any county in this state

to require any person who the comptroller determines may provide

assistance in the examination of a taxpayer's tax obligation to

appear at the place and time stated in the subpoena for the

taking of his oral deposition before an official authorized to

take depositions. The subpoena may require the person to produce

at the time of the deposition books, documents, records, papers,

accounts, and other objects as may be specified by the

comptroller. The subpoena must include a statement setting out

the reason why the requested material is needed.

(2) The deposition shall be taken in the county of the person's

residence or in the county where the person is employed or

regularly transacts business. The subpoena shall specify that the

person shall remain in attendance from day to day until the

deposition is begun and completed.

(3) The officer taking the oral deposition may not sustain

objections to any of the testimony taken or exclude any of it.

(4) When the testimony is fully transcribed, the deposition

shall be submitted to the person for examination and read to or

by the person, unless the examination and reading are waived in

writing by the person and by the comptroller. However, if the

person is represented by an attorney of record, the deposition

officer shall notify the attorney of record in writing by

registered mail or certified mail that the deposition is ready

for examination and reading at the office of the deposition

officer. If the person does not appear and examine, read, and

sign the deposition within 10 days after the mailing of the

notice, the deposition shall be returned and may be used as fully

as though signed. The officer shall enter on the deposition any

changes in form or substance that the person desires to make and

a statement of the reasons given by the person for making them.

The deposition shall then be signed by the person, unless the

person and the comptroller by stipulation waive the signing or

the person is ill, cannot be found, or refuses to sign. If the

deposition is not signed by the person, the officer shall sign it

and state on the record the fact of the waiver, illness, or

absence of the person or the fact of the refusal to sign,

together with the reason, if any, given for failure to sign. The

deposition may then be used as fully as though signed.

(5) The deposition shall be returned to the comptroller by the

official taking the deposition either by mail or by delivering it

in person.

(c) Before a determination of or a hearing on a taxpayer's tax

obligation, if any, the comptroller may:

(1) issue a subpoena addressed to the sheriff or constable of

any county in this state to require any person to produce at the

place and time stated in the subpoena books, documents, records,

papers, accounts, and other objects that the comptroller

determines may assist in an examination of a person's tax

obligation;

(2) issue an order to a person to permit entry upon designated

land or other property in his possession or control for the

purpose of inspecting, measuring, surveying, or photographing the

property or any designated object or operation on the property

that may be material to any matter involved in the examination;

the order must specify the time, place, and manner of making the

inspection, measurement, or survey and taking the copies and

photographs and may prescribe any terms and conditions that are

just;

(3) copy or conduct a complete examination of books, documents,

records, papers, accounts, and other objects that are produced as

a result of the subpoenas or orders specified in this section;

and

(4) serve or have served by his designated agent any subpoena or

order issued under this section by delivering a copy of the

subpoena to the person.

(d) A person, other than the taxpayer, who is subpoenaed to give

a deposition or to produce books, records, papers, or other

objects under the authority of this section is entitled to

receive after presentation of a voucher sworn by the person and

approved by the comptroller:

(1) mileage of 20 cents a mile, or a greater amount as

prescribed by agency rule, for going to and returning from the

place of the hearing or the place where the deposition is taken,

if the place is more than 25 miles from the person's place of

residence; and

(2) a fee of $20 a day, or a greater amount as prescribed by

agency rule, for each day or part of a day the person is

necessarily present as a deponent.

(e) If a person fails to comply with a subpoena or order issued

under this section, the comptroller may:

(1) acting through the attorney general, bring suit to enforce

the subpoena or order in a district court of Travis County; the

court, if it determines that good cause exists for the issuance

of a subpoena or order, shall order the compliance with the

requirements of the subpoena or order; failure to obey the order

of the court may be punishable by the court as contempt;

(2) use records, books, papers, and other documents obtained or

depositions taken under this section only in an administrative

hearing of the comptroller or a judicial proceeding brought by or

against the comptroller; the information may be made available to

the federal government or to another state under an exchange

agreement; and

(3) delegate his authority to issue subpoenas or orders and to

participate in the taking of depositions as specified in this

section to any attorney employed by him.

(f) If a foreign corporation doing business in this state has

such contact with this state that it becomes subject to the taxes

administered and collected by the comptroller and fails to

appoint or maintain a registered agent in this state, or if the

registered agent cannot with reasonable diligence be found at the

registered office, then the secretary of state shall be an agent

of the corporation and may be served with any subpoena or other

order issued under this section in the manner provided for

service of process in Article 8.10, Texas Business Corporation

Act, as amended.

(g) Any person, including the taxpayer, shall be entitled to

obtain upon request a copy of any statement he has previously

made concerning the examination or its subject matter and which

is in the possession, custody, or control of the comptroller.

Copies of statements made to the comptroller by any person which

are used as a basis for an assessment against a taxpayer may be

obtained by the taxpayer upon request. If the request is refused,

the person may move for an agency order under this subsection.

For the purpose of this section, a statement previously made is:

(1) a written statement signed or otherwise adopted or approved

by the person making it; or

(2) a stenographic, mechanical, electrical, or other recording,

or a transcription thereof, which is a substantially verbatim

recital of an oral statement by the person making it and

contemporaneously recorded.

Acts 1981, 67th Leg., p. 1497, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0044. SPECIAL PROCEDURES FOR THIRD-PARTY ORDERS AND

SUBPOENAS. (a)(1) If any order or subpoena described in Section

111.0043 of this code is served on any person who is a

third-party recordkeeper, and the order or subpoena requires the

production of any portion of records made or kept of the business

transactions or affairs of any person (other than the person

ordered or subpoenaed) who is identified in the description of

the record contained in the order or subpoena, then notice of the

order or subpoena shall be given to any person so identified

within three days of the day on which the service on the

third-party recordkeeper is made but no later than the 14th day

before the day fixed in the order or subpoena as the day upon

which the records are to be examined. The notice shall be

accompanied by a copy of the order or subpoena which has been

served and shall contain directions for staying compliance with

the order or subpoena under Subsection (b)(2) of this section.

(2) The notice shall be sufficient if, on or before the third

day, the notice is delivered in hand to the person entitled to

notice or is mailed by certified or registered mail to the last

mailing address of the person or, in the absence of a last known

address, is left with the person ordered or subpoenaed. If the

notice is mailed, it shall be sufficient if mailed to the last

known address of the person entitled to notice.

(3) For purposes of this section, the term "third-party

recordkeeper" means:

(A) a mutual savings bank, cooperative bank, domestic building

and loan association, or other savings institution chartered and

supervised as a savings and loan or similar association under

federal or state law, a bank as defined in Section 581 of the

Internal Revenue Code of 1954, as amended (26 U.S.C. 581), or any

credit union within the meaning of Section 501(c)(14)(A),

Internal Revenue Code;

(B) any consumer reporting agency as defined under Section

603(f) of the Fair Credit Reporting Act (15 U.S.C. 1681a(f));

(C) any person extending credit through the use of credit cards

or similar devices; and

(D) any broker as defined in Section 3(a)(4) of the Securities

Exchange Act of 1934 (15 U.S.C. 78c(a)(4)).

(4) Subsection (a)(1) of this section may not apply to an order

or subpoena served on the person with respect to whose liability

the order or subpoena is issued or an officer or employee of the

person; or any order or subpoena to determine whether or not

records of the business transactions or affairs of an identified

person have been made or kept; or any order or subpoena described

in Subsection (e) of this section.

(5) An order or subpoena to which this subsection applies shall

identify the taxpayer to whom the order or subpoena relates and

to whom the records pertain and shall provide other information

to enable the person ordered or subpoenaed to locate the records

required under the order or subpoena.

(b)(1) Notwithstanding any other law or rule of law, a person who

is entitled to notice of an order or subpoena under Subsection

(a) of this section shall have the right to intervene in any

proceeding with respect to the enforcement of the order or

subpoena under Subsection (e) of Section 111.0043 of this code.

(2) Notwithstanding any other law or rule of law, a person who

is entitled to notice of an order or subpoena under Subsection

(a) of this section shall have the right to stay compliance with

the order or subpoena if, not later than the 14th day after the

day the notice is given in the manner provided in Subsection

(a)(2) of this section:

(A) notice in writing is given to the person ordered or

subpoenaed not to comply with the order or subpoena;

(B) a copy of the notice not to comply with the order or

subpoena is mailed by registered or certified mail to the person

and to the office the comptroller directs in the notice referred

to in Subsection (a)(1) of this section; and

(C) suit is filed against the comptroller in a district court of

Travis County to stay compliance with the order or subpoena.

(c) No examination of any records required to be produced under

an order or subpoena as to which notice is required under

Subsection (a) of this section may be made:

(1) before the expiration of the 14-day period allowed for the

notice not to comply under Subsection (b)(2) of this section; or

(2) when the requirements of Subsection (b)(2) of this section

have been met, except in accordance with an order issued by a

district court of Travis County authorizing examination of the

records or with the consent of the person staying compliance.

(d) If any person takes any action as provided in Subsection (b)

of this section and such person is the person with respect to

whose liability the order or subpoena is issued under Section

111.0043 of this code (or is the agent, nominee, or other person

acting under the direction or control of such person), then the

running of any period of limitations under Subchapter D of this

chapter with respect to the person shall be suspended for the

period during which a proceeding and appeals of the proceeding

with respect to the enforcement of such order are pending.

(e) Any order or subpoena issued under Section 111.0043 of this

code that does not identify the person with respect to whose

liability the order is issued may be served only after a court

proceeding in which the comptroller establishes that:

(1) the order relates to the investigation of a particular

person or ascertainable group or class of persons;

(2) there is a reasonable basis for believing that the person or

group or class of persons may fail or may have failed to comply

with any provision of state law; and

(3) the information sought to be obtained from the examination

of the records (and the identity of the person or persons with

respect to whose liability the order is issued) is not readily

available from other sources.

(f) In the case of an order or subpoena issued under Section

111.0043 of this code, the provisions of Subsections (a)(1) and

(b) of this section may not apply if, upon petition by the

comptroller, the court determines, on the basis of the facts and

circumstances alleged, that there is reasonable cause to believe

the giving of notice may lead to attempts to conceal, destroy, or

alter records relevant to the examination, to prevent the

communication of information from other persons through

intimidation, bribery, or collusion, or to flee to avoid

prosecution, testifying, or production of records.

(g)(1) A district court of Travis County has jurisdiction to hear

and determine proceedings brought under Subsection (e) or (f) of

this section. The determinations required to be made under

Subsections (e) and (f) of this section shall be ex parte and

shall be made solely upon the petition and supporting affidavits.

An order denying the petition shall be deemed a final order that

may be appealed.

(2) Except for cases the court considers of greater importance,

a proceeding brought for the enforcement of any order, or a

proceeding under this section, and appeals, take precedence on

the docket over all cases and shall be assigned for hearing and

decided at the earliest practicable date.

(h) The comptroller shall by rule establish the rates and

conditions for payments to reimburse reasonably necessary costs

directly incurred by third-party recordkeepers in searching for,

reproducing, or transporting books, papers, records, or other

data required to be produced by order or subpoena upon request of

the comptroller. The reimbursement shall be in addition to

mileage and fees paid under Subsections (d)(1) and (d)(2) of

Section 111.0043 of this code.

Acts 1981, 67th Leg., p. 1499, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0045. USE OF OUTSIDE PERSONNEL; DELEGATION OF POWERS.

(a) As necessary to enhance productivity, the comptroller may

employ or contract for the services of accountants, assistants,

auditors, clerks, information technology specialists, and

investigators to:

(1) provide or use the equipment acquired under Subchapter G;

and

(2) assist with the administration of this code.

(b) The comptroller may delegate to persons employed or

contracted under this section the power to perform duties as

required.

Added by Acts 2001, 77th Leg., ch. 1272, Sec. 5.03, eff. June 15,

2001.

Sec. 111.00455. CONTESTED CASES CONDUCTED BY TAX DIVISION OF

STATE OFFICE OF ADMINISTRATIVE HEARINGS. (a) The tax division

of the State Office of Administrative Hearings shall conduct any

contested case hearing as provided by Section 2003.101,

Government Code, in relation to the collection, receipt,

administration, and enforcement of:

(1) a tax imposed under this title; and

(2) any other tax, fee, or other amount that the comptroller is

required to collect, receive, administer, or enforce under a law

not included in this title.

(b) The following are not contested cases under Subsection (a)

and Section 2003.101, Government Code:

(1) a show cause hearing or any hearing not related to the

collection, receipt, administration, or enforcement of the amount

of a tax or fee imposed, or the penalty or interest associated

with that amount, except for a hearing under Section 151.157(f),

151.1575(c), 151.712(g), 154.1142, or 155.0592;

(2) a property value study hearing under Subchapter M, Chapter

403, Government Code;

(3) a hearing in which the issue relates to:

(A) Chapters 72-75, Property Code;

(B) forfeiture of a right to do business;

(C) a certificate of authority;

(D) articles of incorporation;

(E) a penalty imposed under Section 151.7031;

(F) the refusal or failure to settle under Section 111.101; or

(G) a request for or revocation of an exemption from taxation;

and

(4) any other hearing not related to the collection, receipt,

administration, or enforcement of the amount of a tax or fee

imposed, or the penalty or interest associated with that amount.

(c) A reference in law to the comptroller that relates to the

performance of a contested case hearing described by Subsection

(a) means the tax division of the State Office of Administrative

Hearings.

Added by Acts 2007, 80th Leg., R.S., Ch.

354, Sec. 1, eff. June 15, 2007.

Sec. 111.00457. INFORMATION RELATING TO OTHER PERMIT OR LICENSE

REQUIREMENTS. (a) The comptroller shall include the following

statement on each application for a permit or license issued by

the comptroller:

WARNING. You may be required to obtain an additional permit or

license from the State of Texas or from a local governmental

entity to conduct business. A listing of links relating to

acquiring licenses, permits, and registrations from the State of

Texas is available online at

https://www.TexasOnline.com/portal/tol/en/9/1. You may also want

to contact the municipality and county in which you will conduct

business to determine any local governmental requirements.

(b) The statement required by Subsection (a) must be placed in

the applicant signature box or, if the application does not have

an applicant signature box, on the last line above the applicant

signature line, and in bold typeface that is at least as large as

any other typeface appearing in the general instructions relating

to the application.

(c) The comptroller shall revise the statement required by

Subsection (a) as necessary to reflect any change in the Internet

address that provides the listing of links.

Added by Acts 2009, 81st Leg., R.S., Ch.

302, Sec. 1, eff. June 19, 2009.

Sec. 111.0046. PERMIT OR LICENSE. (a) The comptroller shall

refuse to issue or renew any permit or license to a person who:

(1) is not permitted or licensed as required by law for a

different tax or activity administered by the comptroller, except

if the issuance or renewal of such license or permit is pending

before the comptroller; or

(2) is currently delinquent in the payment of any tax collected

by the comptroller.

(b) The comptroller by rule may establish a minimum age for a

person to be eligible to apply for a permit or license issued by

the comptroller.

Added by Acts 1985, 69th Leg., ch. 59, Sec. 1, eff. April 30,

1985. Amended by Acts 2003, 78th Leg., ch. 209, Sec. 13, eff.

Oct. 1, 2003.

Sec. 111.0047. SUSPENSION AND REVOCATION OF PERMIT OR LICENSE.

(a) If a person fails to comply with any provision of this title

or with a rule of the comptroller adopted under this title, the

comptroller, after a hearing, may revoke or suspend any permit or

license issued to the person.

(b) A person whose permit or license the comptroller proposes to

revoke or suspend under this section is entitled to 20 days'

written notice of the time and place of the hearing on the

revocation or suspension. At the hearing the person must show

cause why each permit or license should not be suspended or

revoked.

(c) The comptroller shall give written notice of the revocation

or suspension of a permit or license to the holder of the permit

or license.

(d) Notices under this section may be served on the holder of

the permit or license personally or may be mailed to the holder's

address as shown in the records of the comptroller.

Added by Acts 1985, 69th Leg., ch. 59, Sec. 1, eff. April 30,

1985. Amended by Acts 1989, 71st Leg., ch. 238, Sec. 42, eff.

Jan. 1, 1990; Acts 1991, 72nd Leg., 1st C.S., ch. 6, Sec. 7; Acts

1993, 73rd Leg., ch. 107, Sec. 4.08, eff. Aug. 30, 1993; Acts

1993, 73rd Leg., ch. 284, Sec. 32, eff. Sept. 1, 1993; Acts 1997,

75th Leg., ch. 1040, Sec. 2, eff. Sept. 1, 1997.

Sec. 111.0048. REISSUED OR NEW PERMIT OR LICENSE AFTER

REVOCATION OR SUSPENSION. (a) A new permit or license may not

be issued to a former holder of a revoked permit or license

unless the comptroller is satisfied that the person will comply

with the provisions of this title and the rules of the

comptroller relating to this title.

(b) The comptroller may prescribe the terms under which a

suspended permit or license may be reissued.

Added by Acts 1985, 69th Leg., ch. 59, Sec. 1, eff. April 30,

1985. Amended by Acts 1989, 71st Leg., ch. 238, Sec. 43, eff.

Jan. 1, 1990; Acts 1991, 72nd Leg., 1st C.S., ch. 6, Sec. 8; Acts

1993, 73rd Leg., ch. 107, Sec. 4.09, eff. Aug. 30, 1993; Acts

1993, 73rd Leg., ch. 284, Sec. 33, eff. Sept. 1, 1993; Acts 1997,

75th Leg., ch. 1040, Sec. 3, eff. Sept. 1, 1997.

Sec. 111.0049. APPEALS. A taxpayer may appeal the revocation or

suspension of a permit or license under Section 111.0046 and

111.0047 of this code in the same manner that appeals are made

from a final deficiency determination.

Added by Acts 1985, 69th Leg., ch. 59, Sec. 1, eff. April 30,

1985.

Sec. 111.005. GOVERNMENTAL ENTITIES TO COOPERATE. Each

department, officer, and employee of the state or of a local

governmental entity shall cooperate with and give reasonable

assistance and information to the comptroller when performing

authorized duties.

Acts 1981, 67th Leg., p. 1502, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.006. CONFIDENTIALITY OF INFORMATION. (a) The

following matter is confidential and may not be used publicly,

opened to public inspection, or disclosed except as permitted by

this section:

(1) a federal tax return or federal tax return information

required to have been submitted to the comptroller with a state

tax return or report; and

(2) all information secured, derived, or obtained by the

comptroller or the attorney general during the course of an

examination of the taxpayer's books, records, papers, officers,

or employees, including an examination of the business affairs,

operations, source of income, profits, losses, or expenditures of

the taxpayer.

(b) All information made confidential in this title may not be

subject to subpoena directed to the comptroller or the attorney

general except in a judicial or an administrative proceeding in

which this state, another state, or the federal government is a

party.

(c) The comptroller or the attorney general may use information

or records made confidential by provisions of this title to

enforce any provisions of this title or may authorize their use

in a judicial or an administrative proceeding in which this

state, another state, or the federal government is a party.

(d) The comptroller or the attorney general may disclose to a

municipality or county the information described by Subsection

(a)(2) if:

(1) the information was derived from an examination performed

for the purpose of ascertaining compliance with the hotel

occupancy tax imposed under Chapter 156;

(2) the municipality or county makes a written request for the

information;

(3) the municipality or county making the request has imposed a

local hotel occupancy tax authorized by Chapter 351 or 352, as

applicable;

(4) the municipality or county uses the information only for the

enforcement or administration of its local hotel occupancy tax;

and

(5) to the extent consistent with the use authorized by

Subdivision (4), the municipality or county keeps the information

confidential as provided by this section.

(e) Information made confidential in this title may be examined

by a state officer, a law enforcement officer of this state, a

tax official of another state, a tax official of the United

Mexican States, an official of the United States, or an

authorized representative of any of these officers or officials,

if:

(1) the comptroller authorizes the examination; and

(2) for an official or officer of another state, the United

States, or the United Mexican States, a reciprocal agreement

exists allowing the comptroller to examine tax information under

the control of the officer or official in a manner substantially

equivalent to the officer's or official's access to information

under this subsection.

(f) Subsection (a)(2) does not apply to information obtained by

the comptroller or the attorney general during an examination of

a governmental body, as that term is defined in Section 552.003,

Government Code. However, information obtained by the comptroller

or the attorney general during an examination of the governmental

body that is confidential under law when in the possession of the

governmental body remains confidential while in the possession of

the comptroller or the attorney general.

(g) Information made confidential by Subsection (a)(2) that

relates to a taxpayer's responsibilities under Chapter 162 may be

examined by an official of another state or of the United States

if:

(1) the official has information that would assist the

comptroller in administering Chapter 162;

(2) the comptroller is conducting or may conduct an examination

or a criminal investigation of the taxpayer that is the subject

of the information made confidential by Subsection (a)(2); and

(3) a reciprocal agreement exists allowing the comptroller to

examine information under the control of the official in a manner

substantially equivalent to the official's access to information

under this subsection.

Acts 1981, 67th Leg., p. 1502, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1995, 74th Leg., ch. 175, Sec. 1, eff.

Sept. 1, 1995; Acts 1995, 74th Leg., ch. 351, Sec. 4, eff. Sept.

1, 1995; Acts 1997, 75th Leg., ch. 165, Sec. 29.10, eff. Sept. 1,

1997; Acts 1997, 75th Leg., ch. 1040, Sec. 4, eff. Sept. 1, 1997;

Acts 1999, 76th Leg., ch. 1218, Sec. 2, eff. Sept. 1, 1999.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

1227, Sec. 2, eff. September 1, 2009.

Sec. 111.007. CRIMINAL PENALTIES FOR DISCLOSING FEDERAL TAX

INFORMATION. (a) The comptroller, a person who formerly held

the office of comptroller, or an employee or former employee of

the comptroller commits an offense if he discloses in a manner

unauthorized by law a federal tax return or federal tax return

information that is required to be submitted to the comptroller

by any person.

(b) An offense under this section is a misdemeanor punishable by

a fine of not more than $1,000 or by confinement in jail for not

more than one year, or by both a fine and confinement.

Acts 1981, 67th Leg., p. 1502, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0075. USE OF INFORMATION RELATING TO TAX AUDITS. (a)

This section applies to information that:

(1) relates to a taxpayer that the comptroller is auditing or

intends to audit;

(2) is considered public information under Chapter 552,

Government Code; and

(3) is made available by the comptroller to a person who

requested that information under Chapter 552, Government Code.

(b) A person who obtains information described by Subsection (a)

and who is not a taxpayer to whom the information relates may

not, before the sixth day after the date the comptroller made the

information available to the person, use the information for the

direct solicitation of business or employment for pecuniary gain.

(c) If a direct solicitation of business or employment for

pecuniary gain is made by mail or by delivery by common or

contract carrier, the postmark or the receipt mark of the common

or contract carrier is prima facie evidence of the date the

information was used for that solicitation.

(d) A person who violates this section is subject to a civil

penalty of not more than:

(1) $500 for the first violation;

(2) $1,000 for the second violation; and

(3) $3,000 for each subsequent violation.

(e) At the request of the comptroller or the person to whom the

solicitation was directed, the attorney general or the

appropriate district or county attorney may institute and conduct

a suit to collect the penalty authorized by this section and to

restrain the person from continuing to violate this section.

(f) The penalty prescribed by this section is in addition to any

other penalty provided by law.

Added by Acts 2005, 79th Leg., Ch.

689, Sec. 1, eff. September 1, 2005.

Sec. 111.008. DEFICIENCY DETERMINATION. (a) If the comptroller

is not satisfied with a tax report or the amount of the tax

required to be paid to the state by a person, the comptroller may

compute and determine the amount of tax to be paid from

information contained in the report or from any other information

available to the comptroller.

(b) On making a determination under this section, the

comptroller shall notify the person against whom a determination

is made of the determination. The notice may be given by mail or

by personal service.

(c) If the notice is given by mail, it shall be addressed to the

taxpayer or other person at the taxpayer's address as it appears

in the records of the comptroller. Service by mail is complete

when the notice is deposited in a U.S. Post Office.

Acts 1981, 67th Leg., p. 1502, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0081. WHEN PAYMENT IS REQUIRED. (a) Except as

provided in Subsections (b) and (c) of this section, the amount

of a determination made under this code is due and payable 10

days after it becomes final. If the amount of the determination

is not paid within 10 days after the day it became final, a

penalty of 10 percent of the amount of the determination,

exclusive of penalties and interest, shall be added.

(b) This section does not apply to a determination under Section

111.022.

(c) The amount of a determination made under this code is due

and payable 20 days after a comptroller's decision in a

redetermination hearing becomes final. If the amount of the

determination is not paid within 20 days after the day the

decision became final, a penalty of 10 percent of the amount of

the determination, exclusive of penalties and interest, shall be

added.

Added by Acts 1985, 69th Leg., ch. 37, Sec. 9, eff. Aug. 26,

1985. Amended by Acts 2001, 77th Leg., ch. 1263, Sec. 8, eff.

Sept. 1, 2001.

Sec. 111.009. REDETERMINATION. (a) A person having a direct

interest in a determination may petition the comptroller for a

redetermination.

(b) A petition for redetermination must be filed before the

expiration of 30 days after the date on which the service of the

notice of determination is completed or the redetermination is

barred. If a petition for redetermination is not filed before the

expiration of the period provided by this subsection, the

determination is final on the expiration of the period.

(c) If the petition requests a hearing on the redetermination,

the person filing the petition is entitled to a hearing and to

receive notice of the hearing at least 20 days before the day of

the hearing.

(d) An order or decision of the comptroller on a petition for

redetermination becomes final 20 days after service on the

petitioner of the notice of the order or decision.

Acts 1981, 67th Leg., p. 1503, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1991, 72nd Leg., ch. 705, Sec. 2, eff.

Sept. 1, 1991.

Sec. 111.010. SUIT TO RECOVER TAXES. (a) The attorney general

shall bring suit in the name of the state to recover delinquent

state taxes, tax penalties, and interest owed to the state.

(b) This section applies to state taxes imposed by this title or

by other laws not included in this title but does not apply to

the state ad valorem tax on property.

(c) Venue for and jurisdiction of a suit arising under this

section is exclusively conferred upon the district courts of

Travis County.

(d) The state is entitled to interest at the rate of 10 percent

a year on the amount of a judgment for the state beginning on the

day the judgment is signed and ending on the day the judgment is

satisfied.

Acts 1981, 67th Leg., p. 1503, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1983, 68th Leg., p. 519, ch. 107, Sec. 2,

eff. Sept. 1, 1983; Acts 1991, 72nd Leg., ch. 705, Sec. 3, eff.

Sept. 1, 1991; Acts 1995, 74th Leg., ch. 1000, Sec. 1, eff. Oct.

1, 1995.

Sec. 111.0102. SUIT CHALLENGING COLLECTION ACTION. Venue for

and jurisdiction of a suit that challenges or is for the purpose

of avoiding a comptroller collection action or state tax lien in

any manner is exclusively conferred on the district courts of

Travis County.

Added by Acts 2007, 80th Leg., R.S., Ch.

931, Sec. 1, eff. June 15, 2007.

Sec. 111.011. TAX COLLECTIONS AND REPORTS BY BUSINESSES;

ENFORCEMENT OF DUTIES. (a) If a person engaged in a business

the operation of which involves the receipt, collection, or

withholding of a tax imposed by this title fails to file a report

or pay the tax as required by this title, the attorney general

may bring suit for an injunction prohibiting the person from

continuing in that business until the report is filed and the tax

is paid.

(b) If a person engaged in business the operation of which

involves the receipt, collection, or withholding of a tax imposed

by this title receives, collects, or withholds more tax than is

authorized by law to be received, collected, or withheld or if

the person receives, collects, or withholds money from any other

person under a claim or representation that the receipt,

collection, or withholding is a tax imposed by this title or

other law and the amount received, collected, or withheld is not

a tax authorized by law, and the person does not voluntarily

comply with the notice set forth in Subsection (c) herein, the

attorney general shall bring suit for an injunction prohibiting

the person from the wrongful receipt, collection, or withholding

of the tax or alleged tax.

(c) Prior to filing suit for an injunction, the attorney general

shall send written notice by certified mail requesting that the

person shall cease any wrongful collections of taxes allowing 15

days for compliance from the date of notice.

(d) The venue for a suit under this section is in Travis County.

Acts 1981, 67th Leg., p. 1503, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1985, 69th Leg., ch. 177, Sec. 1, eff.

Sept. 1, 1985.

Sec. 111.012. SECURITY FOR THE PAYMENT OF TAXES. (a) If the

comptroller finds that a tax imposed by this title is insecure,

the comptroller may require a taxpayer to:

(1) provide security for the payment of taxes; or

(2) establish a tax escrow account at a bank or other financial

institution.

(b) The security may consist of:

(1) a cash deposit filed with the comptroller;

(2) a surety bond; or

(3) other security as permitted by the comptroller.

(c) The amount and form of the security shall be set by the

comptroller, except that the amount may not be more than double

the amount of taxes that the comptroller estimates will be due

from the taxpayer during the succeeding 12 months.

(d) The comptroller shall give notice to a taxpayer from whom

security or the establishment of a tax escrow account is required

under this section.

(e) The tax escrow account must be established not later than

the 10th day after the date notice is received from the

comptroller requiring the establishment of the account.

(f) Before the comptroller requires a taxpayer to establish a

tax escrow account, the comptroller must determine that:

(1) the taxpayer remitted or should have remitted a monthly

average of $500 or more in tax collected from customers for the

six-month period preceding the date that the notice requiring the

establishment of a tax escrow account is sent by the comptroller

to the taxpayer; and

(2) the taxpayer:

(A) failed to file two or more tax returns during the 12 months

preceding the date that the notice requiring the establishment of

a tax escrow account is sent by the comptroller to the taxpayer;

(B) has been issued a jeopardy determination under Section

111.022;

(C) has previously been determined to have collected tax but not

remitted that tax under an administrative hearings decision

issued by the comptroller;

(D) is insolvent because the taxpayer's liabilities exceed the

taxpayer's assets or the taxpayer is unable to pay the taxpayer's

debts as they become due;

(E) has assets that are subject to a court administered

receivership; or

(F) has been notified that security is required under this

section but has failed to provide evidence of the security on or

before the 30th day after the date the security was requested.

(g) If a taxpayer does not furnish security to the comptroller

or establish a tax escrow account as required by the comptroller

before the expiration of 10 days following the day on which

notice is received, the comptroller may:

(1) bring suit in a district court in Travis County for an order

enjoining the taxpayer from engaging in business until the

security is furnished or the tax escrow account is established;

or

(2) pursue any other remedies or collection actions available to

the comptroller under this chapter or Chapter 113 to ensure the

security is furnished or the tax escrow account is established.

Acts 1981, 67th Leg., p. 1503, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1991, 72nd Leg., ch. 483, Sec. 1, eff.

Sept. 1, 1991; Acts 2003, 78th Leg., ch. 209, Sec. 14, eff. Oct.

1, 2003.

Sec. 111.013. EVIDENCE: TAX CLAIMS. (a) In a suit involving

the establishment or collection of a tax imposed under Title 2 or

3 of this code, a certificate of the comptroller that shows a

delinquency is prima facie evidence of:

(1) the stated tax or amount of the tax, after all just and

lawful offsets, payments, and credits have been allowed;

(2) the stated amount of penalties and interest;

(3) the delinquency of the amounts; and

(4) the compliance of the comptroller with the applicable

provisions of this code in computing and determining the amount

due.

(b) The defendant may not deny a claim for taxes, penalties, or

interest unless the defendant timely files a sworn written denial

that specifically identifies the taxes, penalties, and interest

the defendant asserts are not due and the amounts of tax,

penalties, and interest that are not due.

Acts 1981, 67th Leg., p. 1504, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1991, 72nd Leg., ch. 705, Sec. 4, eff.

Sept. 1, 1991.

Sec. 111.014. EVIDENCE: COPIES OF GRAPHIC MATTER. (a) A copy

of graphic matter is admissible, without further proof, in a

judicial or administrative proceeding concerning the

administration or enforcement of a tax imposed by this title if:

(1) the copy or information contained in the copy is relevant;

(2) the copy is a reproduction made by a photographic,

photostatic, magnetic, or other process that accurately

duplicates or forms a durable medium for accurately reproducing

the original matter or information contained in the original

matter; and

(3) the graphic matter was kept or recorded by the comptroller

in the performance of official functions.

(b) "Graphic matter" means a memorandum, entry, report, or other

document, a record of information contained in a memorandum,

entry, report, or other document, or a record of an action taken

by the comptroller.

(c) The admissibility of a copy of graphic matter as allowed

under this section does not affect the admissibility of the

original matter or other competent evidence offered to show the

incorrectness of the copy or of information reflected in the

copy.

Acts 1981, 67th Leg., p. 1504, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.015. REMEDIES CUMULATIVE. The rights, powers,

remedies, liens, and penalties provided by this title are

cumulative of other rights, powers, remedies, liens, and

penalties for the collection of taxes provided by this title and

by other law.

Acts 1981, 67th Leg., p. 1504, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.016. PAYMENT TO THE STATE OF TAX COLLECTIONS. (a) Any

person who receives or collects a tax or any money represented to

be a tax from another person holds the amount so collected in

trust for the benefit of the state and is liable to the state for

the full amount collected plus any accrued penalties and interest

on the amount collected.

(a-1) A person is presumed to have received or collected a tax

or money represented to be a tax for the purpose of this section

if the person files, or causes to be filed, a tax return or

report with the comptroller showing tax due. A person, including

a person who is on the accrual method of accounting, may rebut

this presumption by

State Codes and Statutes

Statutes > Texas > Tax-code > Title-2-state-taxation > Chapter-111-collection-procedures

TAX CODE

TITLE 2. STATE TAXATION

SUBTITLE B. ENFORCEMENT AND COLLECTION

CHAPTER 111. COLLECTION PROCEDURES

SUBCHAPTER A. COLLECTION DUTIES AND POWERS

Sec. 111.001. COMPTROLLER TO COLLECT TAXES. The comptroller

shall collect the taxes imposed by this title except as otherwise

provided by this title.

Acts 1981, 67th Leg., p. 1495, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.002. COMPTROLLER'S RULES; COMPLIANCE; FORFEITURE. (a)

The comptroller may adopt rules that do not conflict with the

laws of this state or the constitution of this state or the

United States for the enforcement of the provisions of this title

and the collection of taxes and other revenues under this title.

In addition to the discretion to adopt, repeal, or amend such

rules permitted under the constitution and laws of this state and

under the common law, the comptroller may adopt, repeal, or amend

such rules to reflect changes in the power of this state to

collect taxes and enforce the provisions of this title due to

changes in the constitution or laws of the United States and

judicial interpretations thereof.

(b) A person who does not comply with a rule made under this

section forfeits to the state an amount of not less than $25 nor

more than $500. Each day on which a failure to comply occurs or

continues is a separate violation.

(c) If a forfeiture is not paid, the attorney general shall file

suit to recover the forfeiture in a court of competent

jurisdiction in Travis County or in any other county where venue

lies.

(d) Any other provision of this code that imposes a different

penalty for the violation of a comptroller's rule made for the

enforcement or collection of a specific tax imposed by this title

prevails over the penalty provided by this section.

Acts 1981, 67th Leg., p. 1495, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1989, 71st Leg., ch. 231, Sec. 2, eff. Aug.

28, 1989.

Sec. 111.0021. APPLICATION TO OTHER TAXES AND FEES. This

chapter also applies to a tax or fee that the comptroller is

required to collect under a law not included in this title.

Added by Acts 1991, 72nd Leg., ch. 705, Sec. 1, eff. Sept. 1,

1991.

Sec. 111.0022. APPLICATION TO OTHER LAWS ADMINISTERED BY

COMPTROLLER. This subtitle and Subtitle A of this title apply to

the administration, collection, and enforcement of other taxes,

fees, and charges, including penalties, or other financial

transactions, that the comptroller is required or authorized to

collect or administer under other law, to the extent that the

other law does not conflict with this subtitle or Subtitle A of

this title.

Added by Acts 1993, 73rd Leg., ch. 486, Sec. 1.02, eff. Sept. 1,

1993.

Sec. 111.003. COMPTROLLER'S INVESTIGATIONS. (a) On the

governor's request, the comptroller shall:

(1) investigate the books and accounts of assessing and

collecting officers of the state and other officers or persons

receiving, disbursing, or possessing public funds;

(2) perform other duties and make investigations in relation to

public funds as requested by the governor; and

(3) investigate any state institution and its policies,

management, and operation, including the fiscal affairs and the

conduct and efficiency of any state employee of the institution.

(b) The comptroller shall report to the governor the results of

an investigation requested under Subsection (a) of this section.

The report must be written and include:

(1) a description of each violation of the revenue laws;

(2) a description of the failure, if any, to enforce revenue

laws;

(3) the name of each person reasonably believed to have

committed a violation or to have been guilty of nonfeasance; and

(4) if a state institution is investigated, a description of the

expenditures of the institution and of all sums of money due the

state, the ascertainment and collection of which does not devolve

upon other officers of the state under existing law.

(c) A person connected with the public service shall submit all

books, records, and accounts to the comptroller without delay on

the request of the comptroller when conducting an investigation

under Subsection (a) of this section.

(d) On the receipt of a report that indicates a violation of

revenue laws or neglect of duty, the governor shall notify the

attorney general, who shall institute criminal and civil

proceedings in the name of the state against persons accused of a

violation or neglect of duty.

(e) The comptroller may at any time examine and investigate the

expenditure of appropriated money for a state institution or for

any other purpose or for improvements made by the state on state

property or money received and disbursed by any board authorized

to receive and disburse state money. The comptroller shall

investigate any state institution when required by information

coming to his own knowledge.

Acts 1981, 67th Leg., p. 1495, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0034. ADVANCED DATABASE SYSTEM FOR AUDITS. (a) The

comptroller shall develop an advanced electronic audit database

system for use by the comptroller's audit division. The system

must:

(1) centralize management of audit transaction data;

(2) enhance the quality control of data; and

(3) be compatible with other data systems of the state.

(b) The comptroller may contract with a vendor to develop or

implement the system.

(c) If the comptroller contracts with a vendor to develop or

implement the system, the comptroller must protect any

confidential information provided to the vendor. A person who

receives confidential information under this section and each

employee or agent of that person is subject to the same

prohibitions against disclosure of the information, and the same

penalties and sanctions for improper disclosure, that apply to

the comptroller.

Added by Acts 2001, 77th Leg., ch. 1272, Sec. 5.01, eff. June 15,

2001.

Sec. 111.0035. ADVANCED DATABASE SYSTEM FOR TAX COLLECTIONS.

(a) The comptroller may contract with an appropriate vendor to

develop and implement an advanced database system to enhance tax

collections.

(b) Subject to Subsection (c), the total amount of compensation

paid to the vendor that develops, implements, and maintains the

advanced database system is equal to the product of:

(1) the percentage stated in the contract; and

(2) the amount of revenue collected from taxpayers by the

comptroller, after all available administrative and judicial

appeals are exhausted, as a result of audit and enforcement

actions taken on cases identified from the system.

(c) The amount of compensation paid to a vendor under Subsection

(b) may not exceed the maximum amount, if any, stated in the

contract between the comptroller and the vendor.

(d) The comptroller may pay compensation to a vendor under this

section periodically at the times specified in the contract

between the comptroller and the vendor. The comptroller shall

determine the amount of a periodic payment in accordance with

Subsections (b) and (c). In computing the amount under Subsection

(b)(2), the comptroller may include a case only if the case:

(1) becomes administratively final during the period covered by

the payment; and

(2) is not the subject of litigation at the end of that period.

(e) The comptroller may pay a vendor under this section only

through warrants issued or electronic funds transfers initiated

by the comptroller. The comptroller shall account for the

compensation as a subtraction from tax collections and not as a

general expense of the comptroller.

(f) Except as provided by Subsection (g), the comptroller shall

award a contract made under this section through a competitive

bidding process that complies with Section 2155.132, Government

Code. If the comptroller receives not more than three bids

through the competitive bidding process, the comptroller shall

report the number of bidders to the Legislative Budget Board

before awarding the contract.

(g) The comptroller may enter into separate contracts with

additional appropriate vendors willing and able to develop and

implement an advanced database system to enhance tax collections

at the same rate and under the same terms and conditions as the

contract awarded through competitive bidding.

(h) Except as specifically provided by this section, the

comptroller may include any term or condition in a contract made

under this section that the comptroller considers necessary or

advisable to maximize enhancement of tax collections while

otherwise protecting the state's interests.

(i) The comptroller shall report semiannually to the Legislative

Budget Board the:

(1) amount of revenue collected under this section; and

(2) amount of compensation awarded to a vendor under this

section.

(j) A person acting on behalf of this state under a contract

authorized by this section does not exercise any of the sovereign

power of this state, except that the person is an agent of this

state for purposes of developing and implementing an advanced

database system to enhance tax collections.

(k) The comptroller may provide to a person acting on behalf of

this state under a contract authorized by this section any

confidential information in the custody of the comptroller that

is necessary to develop and implement an advanced database system

to enhance tax collections and that the comptroller is not

prohibited from sharing under an agreement with another state or

the federal government. A person who receives confidential

information under this subsection and each employee or agent of

that person is subject to each prohibition against disclosure of

the information that applies to the comptroller or an employee of

the comptroller. A person, employee, or agent who receives

confidential information under this subsection and improperly

discloses that information is subject to the same penalties and

sanctions that would apply to the comptroller or an employee of

the comptroller for that disclosure.

Added by Acts 1997, 75th Leg., ch. 927, Sec. 1, eff. Sept. 1,

1997. Amended by Acts 2001, 77th Leg., ch. 1272, Sec. 5.02, eff.

June 15, 2001.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.108, eff. September 1, 2007.

Sec. 111.0036. OUT-OF-STATE AUDITS. (a) The comptroller may

contract with one or more appropriate persons to perform tax

audits in any state that is not covered by a comptroller field

office. A contract may provide for a person to perform tax audits

in more than one state.

(b) Subject to Subsection (c), the amount of compensation paid

to a person performing tax audits under this section is equal to

the product of:

(1) the percentage stated in the contract between the

comptroller and the person; and

(2) the amount of revenue collected from taxpayers by the

comptroller, after all available administrative and judicial

appeals are exhausted, as a result of those audits.

(c) The maximum percentage rate stated in a contract may not

exceed 12 percent. In addition, the amount of compensation paid

to a person under Subsection (b) may not exceed the maximum

amount, if any, stated in the contract between the comptroller

and the person.

(d) The comptroller may pay compensation to a person under this

section periodically at the times specified in the contract

between the comptroller and the person. The comptroller shall

determine the amount of a periodic payment in accordance with

Subsections (b) and (c). In computing the amount under Subsection

(b)(2), the comptroller may include a case only if the case:

(1) becomes administratively final during the period covered by

the payment; and

(2) is not the subject of litigation at the end of that period.

(e) The comptroller may pay a person under this section only

through warrants issued or electronic funds transfers initiated

by the comptroller. The comptroller shall account for the

compensation as a subtraction from tax collections and not as a

general expense of the comptroller.

(f) Except as provided by Subsection (g), the comptroller shall

award a contract made under this section through a competitive

bidding process that complies with Section 2155.132, Government

Code. If the comptroller receives not more than three bids

through the competitive bidding process, the comptroller shall

report the number of bidders to the Legislative Budget Board

before awarding the contract.

(g) The comptroller may enter into separate contracts with

additional appropriate persons willing and able to perform tax

audits in other states that are not covered by comptroller field

offices at the same rate and under the same terms and conditions

as the contract awarded through competitive bidding.

(h) The comptroller shall report semiannually to the Legislative

Budget Board the:

(1) amount of revenue collected under this section; and

(2) amount of compensation awarded to a person with whom the

comptroller contracts under this section.

(i) A person acting on behalf of this state under a contract

authorized by this section does not exercise any of the sovereign

power of this state, except that the person is an agent of this

state for purposes of performing tax audits.

(j) The comptroller may provide to a person acting on behalf of

this state under a contract authorized by this section any

confidential information in the custody of the comptroller

relating to a taxpayer that is necessary to the audit of the

taxpayer and that the comptroller is not prohibited from sharing

under an agreement with another state or the federal government.

A person who receives confidential information under this

subsection and each employee or agent of that person are subject

to each prohibition against disclosure of confidential

information obtained from a taxpayer or this state in connection

with a tax audit that applies to the comptroller or an employee

of the comptroller. A person, employee, or agent who receives

confidential information under this subsection and improperly

discloses that information is subject to the same penalties and

sanctions that would apply to the comptroller or an employee of

the comptroller for that disclosure.

Added by Acts 1997, 75th Leg., ch. 927, Sec. 1, eff. Sept. 1,

1997.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.109, eff. September 1, 2007.

Sec. 111.004. POWER TO EXAMINE RECORDS AND PERSONS. (a) For

the purpose of carrying out the terms of this title the

comptroller may examine at the principal or any other office in

the United States of any person, firm, agent, or corporation

permitted to do business in this state, all books, records and

papers and also any of their officers or employees under oath.

(b) If any person refuses to permit an examination or answer any

question authorized by Subsection (a) of this section, the

comptroller may certify the fact of the refusal to the secretary

of state, who shall immediately forfeit the charter or the permit

to do business of the person until the examination as required is

completed.

(c) No charge may be made by the comptroller to examine a book,

record, or paper or to question an officer or employee.

(d) The comptroller's authority to examine books, records, and

papers under this chapter extends to all books, records, papers,

and other objects which the comptroller determines are necessary

for conducting a complete examination under this title.

Acts 1981, 67th Leg., p. 1496, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0041. RECORDS. (a) Any taxpayer who is required by

this title to keep records shall keep those records open to

inspection by the comptroller, the attorney general, or the

authorized representatives of either of them for four years.

(b) This section prevails over any other conflicting provision

of this title.

Acts 1981, 67th Leg., p. 1496, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1999, 76th Leg., ch. 1467, Sec. 2.11, eff.

Oct. 1, 1999.

Sec. 111.0042. SAMPLING IN AUDITING; PROJECTING ASSESSMENTS.

(a) Repealed by Acts 1983, 68th Leg., p. 982, ch. 234, Sec. 1,

eff. May 25, 1983.

(b) Sampling auditing methods are appropriate if:

(1) the taxpayer's records are so detailed, complex, or

voluminous that an audit of all detailed records would be

unreasonable or impractical;

(2) the taxpayer's records are inadequate or insufficient, so

that a competent audit for the period in question is not

otherwise possible; or

(3) the cost of an audit of all detailed records to the taxpayer

or to the state will be unreasonable in relation to the benefits

derived, and sampling procedures will produce a reasonable

result.

(c) Before using a sample technique to establish a tax

liability, the comptroller or his designee must notify the

taxpayer in writing of the sampling procedure to be used.

(d) The sample must reflect as nearly as possible the normal

conditions under which the business was operated during the

period to which the audit applies. If a taxpayer can demonstrate

that a transaction in a sample period is not representative of

the taxpayer's business operations, the transaction shall be

eliminated from the sample and be separately assessed in the

audit. If records are inadequate to reflect accurately the

business operations of the taxpayer, the comptroller or his

designee shall determine the best information available and base

his audit report on that information.

(e) If the taxpayer demonstrates that any sampling method used

by the comptroller was not in accordance with generally

recognized sampling techniques, the audit will be dismissed as to

that portion of the audit established by projection based upon

the sampling method, and a new audit may be performed.

Acts 1981, 67th Leg., p. 1496, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1983, 68th Leg., p. 982, ch. 234, Sec. 1,

eff. May 25, 1983.

Sec. 111.0043. GENERAL AUDIT AND PREHEARING POWERS. (a) In

this section:

(1) "Person" includes an individual, corporation, partner,

partnership, officer, or director of a corporation, joint

venture, trust, trustee, agent, or association.

(2) "Taxpayer" means the person whose tax obligation the

comptroller is seeking to determine.

(b)(1) Before a determination of or a hearing on a taxpayer's tax

obligation, if any, the comptroller may issue a subpoena

addressed to the sheriff or constable of any county in this state

to require any person who the comptroller determines may provide

assistance in the examination of a taxpayer's tax obligation to

appear at the place and time stated in the subpoena for the

taking of his oral deposition before an official authorized to

take depositions. The subpoena may require the person to produce

at the time of the deposition books, documents, records, papers,

accounts, and other objects as may be specified by the

comptroller. The subpoena must include a statement setting out

the reason why the requested material is needed.

(2) The deposition shall be taken in the county of the person's

residence or in the county where the person is employed or

regularly transacts business. The subpoena shall specify that the

person shall remain in attendance from day to day until the

deposition is begun and completed.

(3) The officer taking the oral deposition may not sustain

objections to any of the testimony taken or exclude any of it.

(4) When the testimony is fully transcribed, the deposition

shall be submitted to the person for examination and read to or

by the person, unless the examination and reading are waived in

writing by the person and by the comptroller. However, if the

person is represented by an attorney of record, the deposition

officer shall notify the attorney of record in writing by

registered mail or certified mail that the deposition is ready

for examination and reading at the office of the deposition

officer. If the person does not appear and examine, read, and

sign the deposition within 10 days after the mailing of the

notice, the deposition shall be returned and may be used as fully

as though signed. The officer shall enter on the deposition any

changes in form or substance that the person desires to make and

a statement of the reasons given by the person for making them.

The deposition shall then be signed by the person, unless the

person and the comptroller by stipulation waive the signing or

the person is ill, cannot be found, or refuses to sign. If the

deposition is not signed by the person, the officer shall sign it

and state on the record the fact of the waiver, illness, or

absence of the person or the fact of the refusal to sign,

together with the reason, if any, given for failure to sign. The

deposition may then be used as fully as though signed.

(5) The deposition shall be returned to the comptroller by the

official taking the deposition either by mail or by delivering it

in person.

(c) Before a determination of or a hearing on a taxpayer's tax

obligation, if any, the comptroller may:

(1) issue a subpoena addressed to the sheriff or constable of

any county in this state to require any person to produce at the

place and time stated in the subpoena books, documents, records,

papers, accounts, and other objects that the comptroller

determines may assist in an examination of a person's tax

obligation;

(2) issue an order to a person to permit entry upon designated

land or other property in his possession or control for the

purpose of inspecting, measuring, surveying, or photographing the

property or any designated object or operation on the property

that may be material to any matter involved in the examination;

the order must specify the time, place, and manner of making the

inspection, measurement, or survey and taking the copies and

photographs and may prescribe any terms and conditions that are

just;

(3) copy or conduct a complete examination of books, documents,

records, papers, accounts, and other objects that are produced as

a result of the subpoenas or orders specified in this section;

and

(4) serve or have served by his designated agent any subpoena or

order issued under this section by delivering a copy of the

subpoena to the person.

(d) A person, other than the taxpayer, who is subpoenaed to give

a deposition or to produce books, records, papers, or other

objects under the authority of this section is entitled to

receive after presentation of a voucher sworn by the person and

approved by the comptroller:

(1) mileage of 20 cents a mile, or a greater amount as

prescribed by agency rule, for going to and returning from the

place of the hearing or the place where the deposition is taken,

if the place is more than 25 miles from the person's place of

residence; and

(2) a fee of $20 a day, or a greater amount as prescribed by

agency rule, for each day or part of a day the person is

necessarily present as a deponent.

(e) If a person fails to comply with a subpoena or order issued

under this section, the comptroller may:

(1) acting through the attorney general, bring suit to enforce

the subpoena or order in a district court of Travis County; the

court, if it determines that good cause exists for the issuance

of a subpoena or order, shall order the compliance with the

requirements of the subpoena or order; failure to obey the order

of the court may be punishable by the court as contempt;

(2) use records, books, papers, and other documents obtained or

depositions taken under this section only in an administrative

hearing of the comptroller or a judicial proceeding brought by or

against the comptroller; the information may be made available to

the federal government or to another state under an exchange

agreement; and

(3) delegate his authority to issue subpoenas or orders and to

participate in the taking of depositions as specified in this

section to any attorney employed by him.

(f) If a foreign corporation doing business in this state has

such contact with this state that it becomes subject to the taxes

administered and collected by the comptroller and fails to

appoint or maintain a registered agent in this state, or if the

registered agent cannot with reasonable diligence be found at the

registered office, then the secretary of state shall be an agent

of the corporation and may be served with any subpoena or other

order issued under this section in the manner provided for

service of process in Article 8.10, Texas Business Corporation

Act, as amended.

(g) Any person, including the taxpayer, shall be entitled to

obtain upon request a copy of any statement he has previously

made concerning the examination or its subject matter and which

is in the possession, custody, or control of the comptroller.

Copies of statements made to the comptroller by any person which

are used as a basis for an assessment against a taxpayer may be

obtained by the taxpayer upon request. If the request is refused,

the person may move for an agency order under this subsection.

For the purpose of this section, a statement previously made is:

(1) a written statement signed or otherwise adopted or approved

by the person making it; or

(2) a stenographic, mechanical, electrical, or other recording,

or a transcription thereof, which is a substantially verbatim

recital of an oral statement by the person making it and

contemporaneously recorded.

Acts 1981, 67th Leg., p. 1497, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0044. SPECIAL PROCEDURES FOR THIRD-PARTY ORDERS AND

SUBPOENAS. (a)(1) If any order or subpoena described in Section

111.0043 of this code is served on any person who is a

third-party recordkeeper, and the order or subpoena requires the

production of any portion of records made or kept of the business

transactions or affairs of any person (other than the person

ordered or subpoenaed) who is identified in the description of

the record contained in the order or subpoena, then notice of the

order or subpoena shall be given to any person so identified

within three days of the day on which the service on the

third-party recordkeeper is made but no later than the 14th day

before the day fixed in the order or subpoena as the day upon

which the records are to be examined. The notice shall be

accompanied by a copy of the order or subpoena which has been

served and shall contain directions for staying compliance with

the order or subpoena under Subsection (b)(2) of this section.

(2) The notice shall be sufficient if, on or before the third

day, the notice is delivered in hand to the person entitled to

notice or is mailed by certified or registered mail to the last

mailing address of the person or, in the absence of a last known

address, is left with the person ordered or subpoenaed. If the

notice is mailed, it shall be sufficient if mailed to the last

known address of the person entitled to notice.

(3) For purposes of this section, the term "third-party

recordkeeper" means:

(A) a mutual savings bank, cooperative bank, domestic building

and loan association, or other savings institution chartered and

supervised as a savings and loan or similar association under

federal or state law, a bank as defined in Section 581 of the

Internal Revenue Code of 1954, as amended (26 U.S.C. 581), or any

credit union within the meaning of Section 501(c)(14)(A),

Internal Revenue Code;

(B) any consumer reporting agency as defined under Section

603(f) of the Fair Credit Reporting Act (15 U.S.C. 1681a(f));

(C) any person extending credit through the use of credit cards

or similar devices; and

(D) any broker as defined in Section 3(a)(4) of the Securities

Exchange Act of 1934 (15 U.S.C. 78c(a)(4)).

(4) Subsection (a)(1) of this section may not apply to an order

or subpoena served on the person with respect to whose liability

the order or subpoena is issued or an officer or employee of the

person; or any order or subpoena to determine whether or not

records of the business transactions or affairs of an identified

person have been made or kept; or any order or subpoena described

in Subsection (e) of this section.

(5) An order or subpoena to which this subsection applies shall

identify the taxpayer to whom the order or subpoena relates and

to whom the records pertain and shall provide other information

to enable the person ordered or subpoenaed to locate the records

required under the order or subpoena.

(b)(1) Notwithstanding any other law or rule of law, a person who

is entitled to notice of an order or subpoena under Subsection

(a) of this section shall have the right to intervene in any

proceeding with respect to the enforcement of the order or

subpoena under Subsection (e) of Section 111.0043 of this code.

(2) Notwithstanding any other law or rule of law, a person who

is entitled to notice of an order or subpoena under Subsection

(a) of this section shall have the right to stay compliance with

the order or subpoena if, not later than the 14th day after the

day the notice is given in the manner provided in Subsection

(a)(2) of this section:

(A) notice in writing is given to the person ordered or

subpoenaed not to comply with the order or subpoena;

(B) a copy of the notice not to comply with the order or

subpoena is mailed by registered or certified mail to the person

and to the office the comptroller directs in the notice referred

to in Subsection (a)(1) of this section; and

(C) suit is filed against the comptroller in a district court of

Travis County to stay compliance with the order or subpoena.

(c) No examination of any records required to be produced under

an order or subpoena as to which notice is required under

Subsection (a) of this section may be made:

(1) before the expiration of the 14-day period allowed for the

notice not to comply under Subsection (b)(2) of this section; or

(2) when the requirements of Subsection (b)(2) of this section

have been met, except in accordance with an order issued by a

district court of Travis County authorizing examination of the

records or with the consent of the person staying compliance.

(d) If any person takes any action as provided in Subsection (b)

of this section and such person is the person with respect to

whose liability the order or subpoena is issued under Section

111.0043 of this code (or is the agent, nominee, or other person

acting under the direction or control of such person), then the

running of any period of limitations under Subchapter D of this

chapter with respect to the person shall be suspended for the

period during which a proceeding and appeals of the proceeding

with respect to the enforcement of such order are pending.

(e) Any order or subpoena issued under Section 111.0043 of this

code that does not identify the person with respect to whose

liability the order is issued may be served only after a court

proceeding in which the comptroller establishes that:

(1) the order relates to the investigation of a particular

person or ascertainable group or class of persons;

(2) there is a reasonable basis for believing that the person or

group or class of persons may fail or may have failed to comply

with any provision of state law; and

(3) the information sought to be obtained from the examination

of the records (and the identity of the person or persons with

respect to whose liability the order is issued) is not readily

available from other sources.

(f) In the case of an order or subpoena issued under Section

111.0043 of this code, the provisions of Subsections (a)(1) and

(b) of this section may not apply if, upon petition by the

comptroller, the court determines, on the basis of the facts and

circumstances alleged, that there is reasonable cause to believe

the giving of notice may lead to attempts to conceal, destroy, or

alter records relevant to the examination, to prevent the

communication of information from other persons through

intimidation, bribery, or collusion, or to flee to avoid

prosecution, testifying, or production of records.

(g)(1) A district court of Travis County has jurisdiction to hear

and determine proceedings brought under Subsection (e) or (f) of

this section. The determinations required to be made under

Subsections (e) and (f) of this section shall be ex parte and

shall be made solely upon the petition and supporting affidavits.

An order denying the petition shall be deemed a final order that

may be appealed.

(2) Except for cases the court considers of greater importance,

a proceeding brought for the enforcement of any order, or a

proceeding under this section, and appeals, take precedence on

the docket over all cases and shall be assigned for hearing and

decided at the earliest practicable date.

(h) The comptroller shall by rule establish the rates and

conditions for payments to reimburse reasonably necessary costs

directly incurred by third-party recordkeepers in searching for,

reproducing, or transporting books, papers, records, or other

data required to be produced by order or subpoena upon request of

the comptroller. The reimbursement shall be in addition to

mileage and fees paid under Subsections (d)(1) and (d)(2) of

Section 111.0043 of this code.

Acts 1981, 67th Leg., p. 1499, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0045. USE OF OUTSIDE PERSONNEL; DELEGATION OF POWERS.

(a) As necessary to enhance productivity, the comptroller may

employ or contract for the services of accountants, assistants,

auditors, clerks, information technology specialists, and

investigators to:

(1) provide or use the equipment acquired under Subchapter G;

and

(2) assist with the administration of this code.

(b) The comptroller may delegate to persons employed or

contracted under this section the power to perform duties as

required.

Added by Acts 2001, 77th Leg., ch. 1272, Sec. 5.03, eff. June 15,

2001.

Sec. 111.00455. CONTESTED CASES CONDUCTED BY TAX DIVISION OF

STATE OFFICE OF ADMINISTRATIVE HEARINGS. (a) The tax division

of the State Office of Administrative Hearings shall conduct any

contested case hearing as provided by Section 2003.101,

Government Code, in relation to the collection, receipt,

administration, and enforcement of:

(1) a tax imposed under this title; and

(2) any other tax, fee, or other amount that the comptroller is

required to collect, receive, administer, or enforce under a law

not included in this title.

(b) The following are not contested cases under Subsection (a)

and Section 2003.101, Government Code:

(1) a show cause hearing or any hearing not related to the

collection, receipt, administration, or enforcement of the amount

of a tax or fee imposed, or the penalty or interest associated

with that amount, except for a hearing under Section 151.157(f),

151.1575(c), 151.712(g), 154.1142, or 155.0592;

(2) a property value study hearing under Subchapter M, Chapter

403, Government Code;

(3) a hearing in which the issue relates to:

(A) Chapters 72-75, Property Code;

(B) forfeiture of a right to do business;

(C) a certificate of authority;

(D) articles of incorporation;

(E) a penalty imposed under Section 151.7031;

(F) the refusal or failure to settle under Section 111.101; or

(G) a request for or revocation of an exemption from taxation;

and

(4) any other hearing not related to the collection, receipt,

administration, or enforcement of the amount of a tax or fee

imposed, or the penalty or interest associated with that amount.

(c) A reference in law to the comptroller that relates to the

performance of a contested case hearing described by Subsection

(a) means the tax division of the State Office of Administrative

Hearings.

Added by Acts 2007, 80th Leg., R.S., Ch.

354, Sec. 1, eff. June 15, 2007.

Sec. 111.00457. INFORMATION RELATING TO OTHER PERMIT OR LICENSE

REQUIREMENTS. (a) The comptroller shall include the following

statement on each application for a permit or license issued by

the comptroller:

WARNING. You may be required to obtain an additional permit or

license from the State of Texas or from a local governmental

entity to conduct business. A listing of links relating to

acquiring licenses, permits, and registrations from the State of

Texas is available online at

https://www.TexasOnline.com/portal/tol/en/9/1. You may also want

to contact the municipality and county in which you will conduct

business to determine any local governmental requirements.

(b) The statement required by Subsection (a) must be placed in

the applicant signature box or, if the application does not have

an applicant signature box, on the last line above the applicant

signature line, and in bold typeface that is at least as large as

any other typeface appearing in the general instructions relating

to the application.

(c) The comptroller shall revise the statement required by

Subsection (a) as necessary to reflect any change in the Internet

address that provides the listing of links.

Added by Acts 2009, 81st Leg., R.S., Ch.

302, Sec. 1, eff. June 19, 2009.

Sec. 111.0046. PERMIT OR LICENSE. (a) The comptroller shall

refuse to issue or renew any permit or license to a person who:

(1) is not permitted or licensed as required by law for a

different tax or activity administered by the comptroller, except

if the issuance or renewal of such license or permit is pending

before the comptroller; or

(2) is currently delinquent in the payment of any tax collected

by the comptroller.

(b) The comptroller by rule may establish a minimum age for a

person to be eligible to apply for a permit or license issued by

the comptroller.

Added by Acts 1985, 69th Leg., ch. 59, Sec. 1, eff. April 30,

1985. Amended by Acts 2003, 78th Leg., ch. 209, Sec. 13, eff.

Oct. 1, 2003.

Sec. 111.0047. SUSPENSION AND REVOCATION OF PERMIT OR LICENSE.

(a) If a person fails to comply with any provision of this title

or with a rule of the comptroller adopted under this title, the

comptroller, after a hearing, may revoke or suspend any permit or

license issued to the person.

(b) A person whose permit or license the comptroller proposes to

revoke or suspend under this section is entitled to 20 days'

written notice of the time and place of the hearing on the

revocation or suspension. At the hearing the person must show

cause why each permit or license should not be suspended or

revoked.

(c) The comptroller shall give written notice of the revocation

or suspension of a permit or license to the holder of the permit

or license.

(d) Notices under this section may be served on the holder of

the permit or license personally or may be mailed to the holder's

address as shown in the records of the comptroller.

Added by Acts 1985, 69th Leg., ch. 59, Sec. 1, eff. April 30,

1985. Amended by Acts 1989, 71st Leg., ch. 238, Sec. 42, eff.

Jan. 1, 1990; Acts 1991, 72nd Leg., 1st C.S., ch. 6, Sec. 7; Acts

1993, 73rd Leg., ch. 107, Sec. 4.08, eff. Aug. 30, 1993; Acts

1993, 73rd Leg., ch. 284, Sec. 32, eff. Sept. 1, 1993; Acts 1997,

75th Leg., ch. 1040, Sec. 2, eff. Sept. 1, 1997.

Sec. 111.0048. REISSUED OR NEW PERMIT OR LICENSE AFTER

REVOCATION OR SUSPENSION. (a) A new permit or license may not

be issued to a former holder of a revoked permit or license

unless the comptroller is satisfied that the person will comply

with the provisions of this title and the rules of the

comptroller relating to this title.

(b) The comptroller may prescribe the terms under which a

suspended permit or license may be reissued.

Added by Acts 1985, 69th Leg., ch. 59, Sec. 1, eff. April 30,

1985. Amended by Acts 1989, 71st Leg., ch. 238, Sec. 43, eff.

Jan. 1, 1990; Acts 1991, 72nd Leg., 1st C.S., ch. 6, Sec. 8; Acts

1993, 73rd Leg., ch. 107, Sec. 4.09, eff. Aug. 30, 1993; Acts

1993, 73rd Leg., ch. 284, Sec. 33, eff. Sept. 1, 1993; Acts 1997,

75th Leg., ch. 1040, Sec. 3, eff. Sept. 1, 1997.

Sec. 111.0049. APPEALS. A taxpayer may appeal the revocation or

suspension of a permit or license under Section 111.0046 and

111.0047 of this code in the same manner that appeals are made

from a final deficiency determination.

Added by Acts 1985, 69th Leg., ch. 59, Sec. 1, eff. April 30,

1985.

Sec. 111.005. GOVERNMENTAL ENTITIES TO COOPERATE. Each

department, officer, and employee of the state or of a local

governmental entity shall cooperate with and give reasonable

assistance and information to the comptroller when performing

authorized duties.

Acts 1981, 67th Leg., p. 1502, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.006. CONFIDENTIALITY OF INFORMATION. (a) The

following matter is confidential and may not be used publicly,

opened to public inspection, or disclosed except as permitted by

this section:

(1) a federal tax return or federal tax return information

required to have been submitted to the comptroller with a state

tax return or report; and

(2) all information secured, derived, or obtained by the

comptroller or the attorney general during the course of an

examination of the taxpayer's books, records, papers, officers,

or employees, including an examination of the business affairs,

operations, source of income, profits, losses, or expenditures of

the taxpayer.

(b) All information made confidential in this title may not be

subject to subpoena directed to the comptroller or the attorney

general except in a judicial or an administrative proceeding in

which this state, another state, or the federal government is a

party.

(c) The comptroller or the attorney general may use information

or records made confidential by provisions of this title to

enforce any provisions of this title or may authorize their use

in a judicial or an administrative proceeding in which this

state, another state, or the federal government is a party.

(d) The comptroller or the attorney general may disclose to a

municipality or county the information described by Subsection

(a)(2) if:

(1) the information was derived from an examination performed

for the purpose of ascertaining compliance with the hotel

occupancy tax imposed under Chapter 156;

(2) the municipality or county makes a written request for the

information;

(3) the municipality or county making the request has imposed a

local hotel occupancy tax authorized by Chapter 351 or 352, as

applicable;

(4) the municipality or county uses the information only for the

enforcement or administration of its local hotel occupancy tax;

and

(5) to the extent consistent with the use authorized by

Subdivision (4), the municipality or county keeps the information

confidential as provided by this section.

(e) Information made confidential in this title may be examined

by a state officer, a law enforcement officer of this state, a

tax official of another state, a tax official of the United

Mexican States, an official of the United States, or an

authorized representative of any of these officers or officials,

if:

(1) the comptroller authorizes the examination; and

(2) for an official or officer of another state, the United

States, or the United Mexican States, a reciprocal agreement

exists allowing the comptroller to examine tax information under

the control of the officer or official in a manner substantially

equivalent to the officer's or official's access to information

under this subsection.

(f) Subsection (a)(2) does not apply to information obtained by

the comptroller or the attorney general during an examination of

a governmental body, as that term is defined in Section 552.003,

Government Code. However, information obtained by the comptroller

or the attorney general during an examination of the governmental

body that is confidential under law when in the possession of the

governmental body remains confidential while in the possession of

the comptroller or the attorney general.

(g) Information made confidential by Subsection (a)(2) that

relates to a taxpayer's responsibilities under Chapter 162 may be

examined by an official of another state or of the United States

if:

(1) the official has information that would assist the

comptroller in administering Chapter 162;

(2) the comptroller is conducting or may conduct an examination

or a criminal investigation of the taxpayer that is the subject

of the information made confidential by Subsection (a)(2); and

(3) a reciprocal agreement exists allowing the comptroller to

examine information under the control of the official in a manner

substantially equivalent to the official's access to information

under this subsection.

Acts 1981, 67th Leg., p. 1502, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1995, 74th Leg., ch. 175, Sec. 1, eff.

Sept. 1, 1995; Acts 1995, 74th Leg., ch. 351, Sec. 4, eff. Sept.

1, 1995; Acts 1997, 75th Leg., ch. 165, Sec. 29.10, eff. Sept. 1,

1997; Acts 1997, 75th Leg., ch. 1040, Sec. 4, eff. Sept. 1, 1997;

Acts 1999, 76th Leg., ch. 1218, Sec. 2, eff. Sept. 1, 1999.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

1227, Sec. 2, eff. September 1, 2009.

Sec. 111.007. CRIMINAL PENALTIES FOR DISCLOSING FEDERAL TAX

INFORMATION. (a) The comptroller, a person who formerly held

the office of comptroller, or an employee or former employee of

the comptroller commits an offense if he discloses in a manner

unauthorized by law a federal tax return or federal tax return

information that is required to be submitted to the comptroller

by any person.

(b) An offense under this section is a misdemeanor punishable by

a fine of not more than $1,000 or by confinement in jail for not

more than one year, or by both a fine and confinement.

Acts 1981, 67th Leg., p. 1502, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0075. USE OF INFORMATION RELATING TO TAX AUDITS. (a)

This section applies to information that:

(1) relates to a taxpayer that the comptroller is auditing or

intends to audit;

(2) is considered public information under Chapter 552,

Government Code; and

(3) is made available by the comptroller to a person who

requested that information under Chapter 552, Government Code.

(b) A person who obtains information described by Subsection (a)

and who is not a taxpayer to whom the information relates may

not, before the sixth day after the date the comptroller made the

information available to the person, use the information for the

direct solicitation of business or employment for pecuniary gain.

(c) If a direct solicitation of business or employment for

pecuniary gain is made by mail or by delivery by common or

contract carrier, the postmark or the receipt mark of the common

or contract carrier is prima facie evidence of the date the

information was used for that solicitation.

(d) A person who violates this section is subject to a civil

penalty of not more than:

(1) $500 for the first violation;

(2) $1,000 for the second violation; and

(3) $3,000 for each subsequent violation.

(e) At the request of the comptroller or the person to whom the

solicitation was directed, the attorney general or the

appropriate district or county attorney may institute and conduct

a suit to collect the penalty authorized by this section and to

restrain the person from continuing to violate this section.

(f) The penalty prescribed by this section is in addition to any

other penalty provided by law.

Added by Acts 2005, 79th Leg., Ch.

689, Sec. 1, eff. September 1, 2005.

Sec. 111.008. DEFICIENCY DETERMINATION. (a) If the comptroller

is not satisfied with a tax report or the amount of the tax

required to be paid to the state by a person, the comptroller may

compute and determine the amount of tax to be paid from

information contained in the report or from any other information

available to the comptroller.

(b) On making a determination under this section, the

comptroller shall notify the person against whom a determination

is made of the determination. The notice may be given by mail or

by personal service.

(c) If the notice is given by mail, it shall be addressed to the

taxpayer or other person at the taxpayer's address as it appears

in the records of the comptroller. Service by mail is complete

when the notice is deposited in a U.S. Post Office.

Acts 1981, 67th Leg., p. 1502, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0081. WHEN PAYMENT IS REQUIRED. (a) Except as

provided in Subsections (b) and (c) of this section, the amount

of a determination made under this code is due and payable 10

days after it becomes final. If the amount of the determination

is not paid within 10 days after the day it became final, a

penalty of 10 percent of the amount of the determination,

exclusive of penalties and interest, shall be added.

(b) This section does not apply to a determination under Section

111.022.

(c) The amount of a determination made under this code is due

and payable 20 days after a comptroller's decision in a

redetermination hearing becomes final. If the amount of the

determination is not paid within 20 days after the day the

decision became final, a penalty of 10 percent of the amount of

the determination, exclusive of penalties and interest, shall be

added.

Added by Acts 1985, 69th Leg., ch. 37, Sec. 9, eff. Aug. 26,

1985. Amended by Acts 2001, 77th Leg., ch. 1263, Sec. 8, eff.

Sept. 1, 2001.

Sec. 111.009. REDETERMINATION. (a) A person having a direct

interest in a determination may petition the comptroller for a

redetermination.

(b) A petition for redetermination must be filed before the

expiration of 30 days after the date on which the service of the

notice of determination is completed or the redetermination is

barred. If a petition for redetermination is not filed before the

expiration of the period provided by this subsection, the

determination is final on the expiration of the period.

(c) If the petition requests a hearing on the redetermination,

the person filing the petition is entitled to a hearing and to

receive notice of the hearing at least 20 days before the day of

the hearing.

(d) An order or decision of the comptroller on a petition for

redetermination becomes final 20 days after service on the

petitioner of the notice of the order or decision.

Acts 1981, 67th Leg., p. 1503, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1991, 72nd Leg., ch. 705, Sec. 2, eff.

Sept. 1, 1991.

Sec. 111.010. SUIT TO RECOVER TAXES. (a) The attorney general

shall bring suit in the name of the state to recover delinquent

state taxes, tax penalties, and interest owed to the state.

(b) This section applies to state taxes imposed by this title or

by other laws not included in this title but does not apply to

the state ad valorem tax on property.

(c) Venue for and jurisdiction of a suit arising under this

section is exclusively conferred upon the district courts of

Travis County.

(d) The state is entitled to interest at the rate of 10 percent

a year on the amount of a judgment for the state beginning on the

day the judgment is signed and ending on the day the judgment is

satisfied.

Acts 1981, 67th Leg., p. 1503, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1983, 68th Leg., p. 519, ch. 107, Sec. 2,

eff. Sept. 1, 1983; Acts 1991, 72nd Leg., ch. 705, Sec. 3, eff.

Sept. 1, 1991; Acts 1995, 74th Leg., ch. 1000, Sec. 1, eff. Oct.

1, 1995.

Sec. 111.0102. SUIT CHALLENGING COLLECTION ACTION. Venue for

and jurisdiction of a suit that challenges or is for the purpose

of avoiding a comptroller collection action or state tax lien in

any manner is exclusively conferred on the district courts of

Travis County.

Added by Acts 2007, 80th Leg., R.S., Ch.

931, Sec. 1, eff. June 15, 2007.

Sec. 111.011. TAX COLLECTIONS AND REPORTS BY BUSINESSES;

ENFORCEMENT OF DUTIES. (a) If a person engaged in a business

the operation of which involves the receipt, collection, or

withholding of a tax imposed by this title fails to file a report

or pay the tax as required by this title, the attorney general

may bring suit for an injunction prohibiting the person from

continuing in that business until the report is filed and the tax

is paid.

(b) If a person engaged in business the operation of which

involves the receipt, collection, or withholding of a tax imposed

by this title receives, collects, or withholds more tax than is

authorized by law to be received, collected, or withheld or if

the person receives, collects, or withholds money from any other

person under a claim or representation that the receipt,

collection, or withholding is a tax imposed by this title or

other law and the amount received, collected, or withheld is not

a tax authorized by law, and the person does not voluntarily

comply with the notice set forth in Subsection (c) herein, the

attorney general shall bring suit for an injunction prohibiting

the person from the wrongful receipt, collection, or withholding

of the tax or alleged tax.

(c) Prior to filing suit for an injunction, the attorney general

shall send written notice by certified mail requesting that the

person shall cease any wrongful collections of taxes allowing 15

days for compliance from the date of notice.

(d) The venue for a suit under this section is in Travis County.

Acts 1981, 67th Leg., p. 1503, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1985, 69th Leg., ch. 177, Sec. 1, eff.

Sept. 1, 1985.

Sec. 111.012. SECURITY FOR THE PAYMENT OF TAXES. (a) If the

comptroller finds that a tax imposed by this title is insecure,

the comptroller may require a taxpayer to:

(1) provide security for the payment of taxes; or

(2) establish a tax escrow account at a bank or other financial

institution.

(b) The security may consist of:

(1) a cash deposit filed with the comptroller;

(2) a surety bond; or

(3) other security as permitted by the comptroller.

(c) The amount and form of the security shall be set by the

comptroller, except that the amount may not be more than double

the amount of taxes that the comptroller estimates will be due

from the taxpayer during the succeeding 12 months.

(d) The comptroller shall give notice to a taxpayer from whom

security or the establishment of a tax escrow account is required

under this section.

(e) The tax escrow account must be established not later than

the 10th day after the date notice is received from the

comptroller requiring the establishment of the account.

(f) Before the comptroller requires a taxpayer to establish a

tax escrow account, the comptroller must determine that:

(1) the taxpayer remitted or should have remitted a monthly

average of $500 or more in tax collected from customers for the

six-month period preceding the date that the notice requiring the

establishment of a tax escrow account is sent by the comptroller

to the taxpayer; and

(2) the taxpayer:

(A) failed to file two or more tax returns during the 12 months

preceding the date that the notice requiring the establishment of

a tax escrow account is sent by the comptroller to the taxpayer;

(B) has been issued a jeopardy determination under Section

111.022;

(C) has previously been determined to have collected tax but not

remitted that tax under an administrative hearings decision

issued by the comptroller;

(D) is insolvent because the taxpayer's liabilities exceed the

taxpayer's assets or the taxpayer is unable to pay the taxpayer's

debts as they become due;

(E) has assets that are subject to a court administered

receivership; or

(F) has been notified that security is required under this

section but has failed to provide evidence of the security on or

before the 30th day after the date the security was requested.

(g) If a taxpayer does not furnish security to the comptroller

or establish a tax escrow account as required by the comptroller

before the expiration of 10 days following the day on which

notice is received, the comptroller may:

(1) bring suit in a district court in Travis County for an order

enjoining the taxpayer from engaging in business until the

security is furnished or the tax escrow account is established;

or

(2) pursue any other remedies or collection actions available to

the comptroller under this chapter or Chapter 113 to ensure the

security is furnished or the tax escrow account is established.

Acts 1981, 67th Leg., p. 1503, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1991, 72nd Leg., ch. 483, Sec. 1, eff.

Sept. 1, 1991; Acts 2003, 78th Leg., ch. 209, Sec. 14, eff. Oct.

1, 2003.

Sec. 111.013. EVIDENCE: TAX CLAIMS. (a) In a suit involving

the establishment or collection of a tax imposed under Title 2 or

3 of this code, a certificate of the comptroller that shows a

delinquency is prima facie evidence of:

(1) the stated tax or amount of the tax, after all just and

lawful offsets, payments, and credits have been allowed;

(2) the stated amount of penalties and interest;

(3) the delinquency of the amounts; and

(4) the compliance of the comptroller with the applicable

provisions of this code in computing and determining the amount

due.

(b) The defendant may not deny a claim for taxes, penalties, or

interest unless the defendant timely files a sworn written denial

that specifically identifies the taxes, penalties, and interest

the defendant asserts are not due and the amounts of tax,

penalties, and interest that are not due.

Acts 1981, 67th Leg., p. 1504, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1991, 72nd Leg., ch. 705, Sec. 4, eff.

Sept. 1, 1991.

Sec. 111.014. EVIDENCE: COPIES OF GRAPHIC MATTER. (a) A copy

of graphic matter is admissible, without further proof, in a

judicial or administrative proceeding concerning the

administration or enforcement of a tax imposed by this title if:

(1) the copy or information contained in the copy is relevant;

(2) the copy is a reproduction made by a photographic,

photostatic, magnetic, or other process that accurately

duplicates or forms a durable medium for accurately reproducing

the original matter or information contained in the original

matter; and

(3) the graphic matter was kept or recorded by the comptroller

in the performance of official functions.

(b) "Graphic matter" means a memorandum, entry, report, or other

document, a record of information contained in a memorandum,

entry, report, or other document, or a record of an action taken

by the comptroller.

(c) The admissibility of a copy of graphic matter as allowed

under this section does not affect the admissibility of the

original matter or other competent evidence offered to show the

incorrectness of the copy or of information reflected in the

copy.

Acts 1981, 67th Leg., p. 1504, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.015. REMEDIES CUMULATIVE. The rights, powers,

remedies, liens, and penalties provided by this title are

cumulative of other rights, powers, remedies, liens, and

penalties for the collection of taxes provided by this title and

by other law.

Acts 1981, 67th Leg., p. 1504, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.016. PAYMENT TO THE STATE OF TAX COLLECTIONS. (a) Any

person who receives or collects a tax or any money represented to

be a tax from another person holds the amount so collected in

trust for the benefit of the state and is liable to the state for

the full amount collected plus any accrued penalties and interest

on the amount collected.

(a-1) A person is presumed to have received or collected a tax

or money represented to be a tax for the purpose of this section

if the person files, or causes to be filed, a tax return or

report with the comptroller showing tax due. A person, including

a person who is on the accrual method of accounting, may rebut

this presumption by


State Codes and Statutes

State Codes and Statutes

Statutes > Texas > Tax-code > Title-2-state-taxation > Chapter-111-collection-procedures

TAX CODE

TITLE 2. STATE TAXATION

SUBTITLE B. ENFORCEMENT AND COLLECTION

CHAPTER 111. COLLECTION PROCEDURES

SUBCHAPTER A. COLLECTION DUTIES AND POWERS

Sec. 111.001. COMPTROLLER TO COLLECT TAXES. The comptroller

shall collect the taxes imposed by this title except as otherwise

provided by this title.

Acts 1981, 67th Leg., p. 1495, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.002. COMPTROLLER'S RULES; COMPLIANCE; FORFEITURE. (a)

The comptroller may adopt rules that do not conflict with the

laws of this state or the constitution of this state or the

United States for the enforcement of the provisions of this title

and the collection of taxes and other revenues under this title.

In addition to the discretion to adopt, repeal, or amend such

rules permitted under the constitution and laws of this state and

under the common law, the comptroller may adopt, repeal, or amend

such rules to reflect changes in the power of this state to

collect taxes and enforce the provisions of this title due to

changes in the constitution or laws of the United States and

judicial interpretations thereof.

(b) A person who does not comply with a rule made under this

section forfeits to the state an amount of not less than $25 nor

more than $500. Each day on which a failure to comply occurs or

continues is a separate violation.

(c) If a forfeiture is not paid, the attorney general shall file

suit to recover the forfeiture in a court of competent

jurisdiction in Travis County or in any other county where venue

lies.

(d) Any other provision of this code that imposes a different

penalty for the violation of a comptroller's rule made for the

enforcement or collection of a specific tax imposed by this title

prevails over the penalty provided by this section.

Acts 1981, 67th Leg., p. 1495, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1989, 71st Leg., ch. 231, Sec. 2, eff. Aug.

28, 1989.

Sec. 111.0021. APPLICATION TO OTHER TAXES AND FEES. This

chapter also applies to a tax or fee that the comptroller is

required to collect under a law not included in this title.

Added by Acts 1991, 72nd Leg., ch. 705, Sec. 1, eff. Sept. 1,

1991.

Sec. 111.0022. APPLICATION TO OTHER LAWS ADMINISTERED BY

COMPTROLLER. This subtitle and Subtitle A of this title apply to

the administration, collection, and enforcement of other taxes,

fees, and charges, including penalties, or other financial

transactions, that the comptroller is required or authorized to

collect or administer under other law, to the extent that the

other law does not conflict with this subtitle or Subtitle A of

this title.

Added by Acts 1993, 73rd Leg., ch. 486, Sec. 1.02, eff. Sept. 1,

1993.

Sec. 111.003. COMPTROLLER'S INVESTIGATIONS. (a) On the

governor's request, the comptroller shall:

(1) investigate the books and accounts of assessing and

collecting officers of the state and other officers or persons

receiving, disbursing, or possessing public funds;

(2) perform other duties and make investigations in relation to

public funds as requested by the governor; and

(3) investigate any state institution and its policies,

management, and operation, including the fiscal affairs and the

conduct and efficiency of any state employee of the institution.

(b) The comptroller shall report to the governor the results of

an investigation requested under Subsection (a) of this section.

The report must be written and include:

(1) a description of each violation of the revenue laws;

(2) a description of the failure, if any, to enforce revenue

laws;

(3) the name of each person reasonably believed to have

committed a violation or to have been guilty of nonfeasance; and

(4) if a state institution is investigated, a description of the

expenditures of the institution and of all sums of money due the

state, the ascertainment and collection of which does not devolve

upon other officers of the state under existing law.

(c) A person connected with the public service shall submit all

books, records, and accounts to the comptroller without delay on

the request of the comptroller when conducting an investigation

under Subsection (a) of this section.

(d) On the receipt of a report that indicates a violation of

revenue laws or neglect of duty, the governor shall notify the

attorney general, who shall institute criminal and civil

proceedings in the name of the state against persons accused of a

violation or neglect of duty.

(e) The comptroller may at any time examine and investigate the

expenditure of appropriated money for a state institution or for

any other purpose or for improvements made by the state on state

property or money received and disbursed by any board authorized

to receive and disburse state money. The comptroller shall

investigate any state institution when required by information

coming to his own knowledge.

Acts 1981, 67th Leg., p. 1495, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0034. ADVANCED DATABASE SYSTEM FOR AUDITS. (a) The

comptroller shall develop an advanced electronic audit database

system for use by the comptroller's audit division. The system

must:

(1) centralize management of audit transaction data;

(2) enhance the quality control of data; and

(3) be compatible with other data systems of the state.

(b) The comptroller may contract with a vendor to develop or

implement the system.

(c) If the comptroller contracts with a vendor to develop or

implement the system, the comptroller must protect any

confidential information provided to the vendor. A person who

receives confidential information under this section and each

employee or agent of that person is subject to the same

prohibitions against disclosure of the information, and the same

penalties and sanctions for improper disclosure, that apply to

the comptroller.

Added by Acts 2001, 77th Leg., ch. 1272, Sec. 5.01, eff. June 15,

2001.

Sec. 111.0035. ADVANCED DATABASE SYSTEM FOR TAX COLLECTIONS.

(a) The comptroller may contract with an appropriate vendor to

develop and implement an advanced database system to enhance tax

collections.

(b) Subject to Subsection (c), the total amount of compensation

paid to the vendor that develops, implements, and maintains the

advanced database system is equal to the product of:

(1) the percentage stated in the contract; and

(2) the amount of revenue collected from taxpayers by the

comptroller, after all available administrative and judicial

appeals are exhausted, as a result of audit and enforcement

actions taken on cases identified from the system.

(c) The amount of compensation paid to a vendor under Subsection

(b) may not exceed the maximum amount, if any, stated in the

contract between the comptroller and the vendor.

(d) The comptroller may pay compensation to a vendor under this

section periodically at the times specified in the contract

between the comptroller and the vendor. The comptroller shall

determine the amount of a periodic payment in accordance with

Subsections (b) and (c). In computing the amount under Subsection

(b)(2), the comptroller may include a case only if the case:

(1) becomes administratively final during the period covered by

the payment; and

(2) is not the subject of litigation at the end of that period.

(e) The comptroller may pay a vendor under this section only

through warrants issued or electronic funds transfers initiated

by the comptroller. The comptroller shall account for the

compensation as a subtraction from tax collections and not as a

general expense of the comptroller.

(f) Except as provided by Subsection (g), the comptroller shall

award a contract made under this section through a competitive

bidding process that complies with Section 2155.132, Government

Code. If the comptroller receives not more than three bids

through the competitive bidding process, the comptroller shall

report the number of bidders to the Legislative Budget Board

before awarding the contract.

(g) The comptroller may enter into separate contracts with

additional appropriate vendors willing and able to develop and

implement an advanced database system to enhance tax collections

at the same rate and under the same terms and conditions as the

contract awarded through competitive bidding.

(h) Except as specifically provided by this section, the

comptroller may include any term or condition in a contract made

under this section that the comptroller considers necessary or

advisable to maximize enhancement of tax collections while

otherwise protecting the state's interests.

(i) The comptroller shall report semiannually to the Legislative

Budget Board the:

(1) amount of revenue collected under this section; and

(2) amount of compensation awarded to a vendor under this

section.

(j) A person acting on behalf of this state under a contract

authorized by this section does not exercise any of the sovereign

power of this state, except that the person is an agent of this

state for purposes of developing and implementing an advanced

database system to enhance tax collections.

(k) The comptroller may provide to a person acting on behalf of

this state under a contract authorized by this section any

confidential information in the custody of the comptroller that

is necessary to develop and implement an advanced database system

to enhance tax collections and that the comptroller is not

prohibited from sharing under an agreement with another state or

the federal government. A person who receives confidential

information under this subsection and each employee or agent of

that person is subject to each prohibition against disclosure of

the information that applies to the comptroller or an employee of

the comptroller. A person, employee, or agent who receives

confidential information under this subsection and improperly

discloses that information is subject to the same penalties and

sanctions that would apply to the comptroller or an employee of

the comptroller for that disclosure.

Added by Acts 1997, 75th Leg., ch. 927, Sec. 1, eff. Sept. 1,

1997. Amended by Acts 2001, 77th Leg., ch. 1272, Sec. 5.02, eff.

June 15, 2001.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.108, eff. September 1, 2007.

Sec. 111.0036. OUT-OF-STATE AUDITS. (a) The comptroller may

contract with one or more appropriate persons to perform tax

audits in any state that is not covered by a comptroller field

office. A contract may provide for a person to perform tax audits

in more than one state.

(b) Subject to Subsection (c), the amount of compensation paid

to a person performing tax audits under this section is equal to

the product of:

(1) the percentage stated in the contract between the

comptroller and the person; and

(2) the amount of revenue collected from taxpayers by the

comptroller, after all available administrative and judicial

appeals are exhausted, as a result of those audits.

(c) The maximum percentage rate stated in a contract may not

exceed 12 percent. In addition, the amount of compensation paid

to a person under Subsection (b) may not exceed the maximum

amount, if any, stated in the contract between the comptroller

and the person.

(d) The comptroller may pay compensation to a person under this

section periodically at the times specified in the contract

between the comptroller and the person. The comptroller shall

determine the amount of a periodic payment in accordance with

Subsections (b) and (c). In computing the amount under Subsection

(b)(2), the comptroller may include a case only if the case:

(1) becomes administratively final during the period covered by

the payment; and

(2) is not the subject of litigation at the end of that period.

(e) The comptroller may pay a person under this section only

through warrants issued or electronic funds transfers initiated

by the comptroller. The comptroller shall account for the

compensation as a subtraction from tax collections and not as a

general expense of the comptroller.

(f) Except as provided by Subsection (g), the comptroller shall

award a contract made under this section through a competitive

bidding process that complies with Section 2155.132, Government

Code. If the comptroller receives not more than three bids

through the competitive bidding process, the comptroller shall

report the number of bidders to the Legislative Budget Board

before awarding the contract.

(g) The comptroller may enter into separate contracts with

additional appropriate persons willing and able to perform tax

audits in other states that are not covered by comptroller field

offices at the same rate and under the same terms and conditions

as the contract awarded through competitive bidding.

(h) The comptroller shall report semiannually to the Legislative

Budget Board the:

(1) amount of revenue collected under this section; and

(2) amount of compensation awarded to a person with whom the

comptroller contracts under this section.

(i) A person acting on behalf of this state under a contract

authorized by this section does not exercise any of the sovereign

power of this state, except that the person is an agent of this

state for purposes of performing tax audits.

(j) The comptroller may provide to a person acting on behalf of

this state under a contract authorized by this section any

confidential information in the custody of the comptroller

relating to a taxpayer that is necessary to the audit of the

taxpayer and that the comptroller is not prohibited from sharing

under an agreement with another state or the federal government.

A person who receives confidential information under this

subsection and each employee or agent of that person are subject

to each prohibition against disclosure of confidential

information obtained from a taxpayer or this state in connection

with a tax audit that applies to the comptroller or an employee

of the comptroller. A person, employee, or agent who receives

confidential information under this subsection and improperly

discloses that information is subject to the same penalties and

sanctions that would apply to the comptroller or an employee of

the comptroller for that disclosure.

Added by Acts 1997, 75th Leg., ch. 927, Sec. 1, eff. Sept. 1,

1997.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.109, eff. September 1, 2007.

Sec. 111.004. POWER TO EXAMINE RECORDS AND PERSONS. (a) For

the purpose of carrying out the terms of this title the

comptroller may examine at the principal or any other office in

the United States of any person, firm, agent, or corporation

permitted to do business in this state, all books, records and

papers and also any of their officers or employees under oath.

(b) If any person refuses to permit an examination or answer any

question authorized by Subsection (a) of this section, the

comptroller may certify the fact of the refusal to the secretary

of state, who shall immediately forfeit the charter or the permit

to do business of the person until the examination as required is

completed.

(c) No charge may be made by the comptroller to examine a book,

record, or paper or to question an officer or employee.

(d) The comptroller's authority to examine books, records, and

papers under this chapter extends to all books, records, papers,

and other objects which the comptroller determines are necessary

for conducting a complete examination under this title.

Acts 1981, 67th Leg., p. 1496, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0041. RECORDS. (a) Any taxpayer who is required by

this title to keep records shall keep those records open to

inspection by the comptroller, the attorney general, or the

authorized representatives of either of them for four years.

(b) This section prevails over any other conflicting provision

of this title.

Acts 1981, 67th Leg., p. 1496, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1999, 76th Leg., ch. 1467, Sec. 2.11, eff.

Oct. 1, 1999.

Sec. 111.0042. SAMPLING IN AUDITING; PROJECTING ASSESSMENTS.

(a) Repealed by Acts 1983, 68th Leg., p. 982, ch. 234, Sec. 1,

eff. May 25, 1983.

(b) Sampling auditing methods are appropriate if:

(1) the taxpayer's records are so detailed, complex, or

voluminous that an audit of all detailed records would be

unreasonable or impractical;

(2) the taxpayer's records are inadequate or insufficient, so

that a competent audit for the period in question is not

otherwise possible; or

(3) the cost of an audit of all detailed records to the taxpayer

or to the state will be unreasonable in relation to the benefits

derived, and sampling procedures will produce a reasonable

result.

(c) Before using a sample technique to establish a tax

liability, the comptroller or his designee must notify the

taxpayer in writing of the sampling procedure to be used.

(d) The sample must reflect as nearly as possible the normal

conditions under which the business was operated during the

period to which the audit applies. If a taxpayer can demonstrate

that a transaction in a sample period is not representative of

the taxpayer's business operations, the transaction shall be

eliminated from the sample and be separately assessed in the

audit. If records are inadequate to reflect accurately the

business operations of the taxpayer, the comptroller or his

designee shall determine the best information available and base

his audit report on that information.

(e) If the taxpayer demonstrates that any sampling method used

by the comptroller was not in accordance with generally

recognized sampling techniques, the audit will be dismissed as to

that portion of the audit established by projection based upon

the sampling method, and a new audit may be performed.

Acts 1981, 67th Leg., p. 1496, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1983, 68th Leg., p. 982, ch. 234, Sec. 1,

eff. May 25, 1983.

Sec. 111.0043. GENERAL AUDIT AND PREHEARING POWERS. (a) In

this section:

(1) "Person" includes an individual, corporation, partner,

partnership, officer, or director of a corporation, joint

venture, trust, trustee, agent, or association.

(2) "Taxpayer" means the person whose tax obligation the

comptroller is seeking to determine.

(b)(1) Before a determination of or a hearing on a taxpayer's tax

obligation, if any, the comptroller may issue a subpoena

addressed to the sheriff or constable of any county in this state

to require any person who the comptroller determines may provide

assistance in the examination of a taxpayer's tax obligation to

appear at the place and time stated in the subpoena for the

taking of his oral deposition before an official authorized to

take depositions. The subpoena may require the person to produce

at the time of the deposition books, documents, records, papers,

accounts, and other objects as may be specified by the

comptroller. The subpoena must include a statement setting out

the reason why the requested material is needed.

(2) The deposition shall be taken in the county of the person's

residence or in the county where the person is employed or

regularly transacts business. The subpoena shall specify that the

person shall remain in attendance from day to day until the

deposition is begun and completed.

(3) The officer taking the oral deposition may not sustain

objections to any of the testimony taken or exclude any of it.

(4) When the testimony is fully transcribed, the deposition

shall be submitted to the person for examination and read to or

by the person, unless the examination and reading are waived in

writing by the person and by the comptroller. However, if the

person is represented by an attorney of record, the deposition

officer shall notify the attorney of record in writing by

registered mail or certified mail that the deposition is ready

for examination and reading at the office of the deposition

officer. If the person does not appear and examine, read, and

sign the deposition within 10 days after the mailing of the

notice, the deposition shall be returned and may be used as fully

as though signed. The officer shall enter on the deposition any

changes in form or substance that the person desires to make and

a statement of the reasons given by the person for making them.

The deposition shall then be signed by the person, unless the

person and the comptroller by stipulation waive the signing or

the person is ill, cannot be found, or refuses to sign. If the

deposition is not signed by the person, the officer shall sign it

and state on the record the fact of the waiver, illness, or

absence of the person or the fact of the refusal to sign,

together with the reason, if any, given for failure to sign. The

deposition may then be used as fully as though signed.

(5) The deposition shall be returned to the comptroller by the

official taking the deposition either by mail or by delivering it

in person.

(c) Before a determination of or a hearing on a taxpayer's tax

obligation, if any, the comptroller may:

(1) issue a subpoena addressed to the sheriff or constable of

any county in this state to require any person to produce at the

place and time stated in the subpoena books, documents, records,

papers, accounts, and other objects that the comptroller

determines may assist in an examination of a person's tax

obligation;

(2) issue an order to a person to permit entry upon designated

land or other property in his possession or control for the

purpose of inspecting, measuring, surveying, or photographing the

property or any designated object or operation on the property

that may be material to any matter involved in the examination;

the order must specify the time, place, and manner of making the

inspection, measurement, or survey and taking the copies and

photographs and may prescribe any terms and conditions that are

just;

(3) copy or conduct a complete examination of books, documents,

records, papers, accounts, and other objects that are produced as

a result of the subpoenas or orders specified in this section;

and

(4) serve or have served by his designated agent any subpoena or

order issued under this section by delivering a copy of the

subpoena to the person.

(d) A person, other than the taxpayer, who is subpoenaed to give

a deposition or to produce books, records, papers, or other

objects under the authority of this section is entitled to

receive after presentation of a voucher sworn by the person and

approved by the comptroller:

(1) mileage of 20 cents a mile, or a greater amount as

prescribed by agency rule, for going to and returning from the

place of the hearing or the place where the deposition is taken,

if the place is more than 25 miles from the person's place of

residence; and

(2) a fee of $20 a day, or a greater amount as prescribed by

agency rule, for each day or part of a day the person is

necessarily present as a deponent.

(e) If a person fails to comply with a subpoena or order issued

under this section, the comptroller may:

(1) acting through the attorney general, bring suit to enforce

the subpoena or order in a district court of Travis County; the

court, if it determines that good cause exists for the issuance

of a subpoena or order, shall order the compliance with the

requirements of the subpoena or order; failure to obey the order

of the court may be punishable by the court as contempt;

(2) use records, books, papers, and other documents obtained or

depositions taken under this section only in an administrative

hearing of the comptroller or a judicial proceeding brought by or

against the comptroller; the information may be made available to

the federal government or to another state under an exchange

agreement; and

(3) delegate his authority to issue subpoenas or orders and to

participate in the taking of depositions as specified in this

section to any attorney employed by him.

(f) If a foreign corporation doing business in this state has

such contact with this state that it becomes subject to the taxes

administered and collected by the comptroller and fails to

appoint or maintain a registered agent in this state, or if the

registered agent cannot with reasonable diligence be found at the

registered office, then the secretary of state shall be an agent

of the corporation and may be served with any subpoena or other

order issued under this section in the manner provided for

service of process in Article 8.10, Texas Business Corporation

Act, as amended.

(g) Any person, including the taxpayer, shall be entitled to

obtain upon request a copy of any statement he has previously

made concerning the examination or its subject matter and which

is in the possession, custody, or control of the comptroller.

Copies of statements made to the comptroller by any person which

are used as a basis for an assessment against a taxpayer may be

obtained by the taxpayer upon request. If the request is refused,

the person may move for an agency order under this subsection.

For the purpose of this section, a statement previously made is:

(1) a written statement signed or otherwise adopted or approved

by the person making it; or

(2) a stenographic, mechanical, electrical, or other recording,

or a transcription thereof, which is a substantially verbatim

recital of an oral statement by the person making it and

contemporaneously recorded.

Acts 1981, 67th Leg., p. 1497, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0044. SPECIAL PROCEDURES FOR THIRD-PARTY ORDERS AND

SUBPOENAS. (a)(1) If any order or subpoena described in Section

111.0043 of this code is served on any person who is a

third-party recordkeeper, and the order or subpoena requires the

production of any portion of records made or kept of the business

transactions or affairs of any person (other than the person

ordered or subpoenaed) who is identified in the description of

the record contained in the order or subpoena, then notice of the

order or subpoena shall be given to any person so identified

within three days of the day on which the service on the

third-party recordkeeper is made but no later than the 14th day

before the day fixed in the order or subpoena as the day upon

which the records are to be examined. The notice shall be

accompanied by a copy of the order or subpoena which has been

served and shall contain directions for staying compliance with

the order or subpoena under Subsection (b)(2) of this section.

(2) The notice shall be sufficient if, on or before the third

day, the notice is delivered in hand to the person entitled to

notice or is mailed by certified or registered mail to the last

mailing address of the person or, in the absence of a last known

address, is left with the person ordered or subpoenaed. If the

notice is mailed, it shall be sufficient if mailed to the last

known address of the person entitled to notice.

(3) For purposes of this section, the term "third-party

recordkeeper" means:

(A) a mutual savings bank, cooperative bank, domestic building

and loan association, or other savings institution chartered and

supervised as a savings and loan or similar association under

federal or state law, a bank as defined in Section 581 of the

Internal Revenue Code of 1954, as amended (26 U.S.C. 581), or any

credit union within the meaning of Section 501(c)(14)(A),

Internal Revenue Code;

(B) any consumer reporting agency as defined under Section

603(f) of the Fair Credit Reporting Act (15 U.S.C. 1681a(f));

(C) any person extending credit through the use of credit cards

or similar devices; and

(D) any broker as defined in Section 3(a)(4) of the Securities

Exchange Act of 1934 (15 U.S.C. 78c(a)(4)).

(4) Subsection (a)(1) of this section may not apply to an order

or subpoena served on the person with respect to whose liability

the order or subpoena is issued or an officer or employee of the

person; or any order or subpoena to determine whether or not

records of the business transactions or affairs of an identified

person have been made or kept; or any order or subpoena described

in Subsection (e) of this section.

(5) An order or subpoena to which this subsection applies shall

identify the taxpayer to whom the order or subpoena relates and

to whom the records pertain and shall provide other information

to enable the person ordered or subpoenaed to locate the records

required under the order or subpoena.

(b)(1) Notwithstanding any other law or rule of law, a person who

is entitled to notice of an order or subpoena under Subsection

(a) of this section shall have the right to intervene in any

proceeding with respect to the enforcement of the order or

subpoena under Subsection (e) of Section 111.0043 of this code.

(2) Notwithstanding any other law or rule of law, a person who

is entitled to notice of an order or subpoena under Subsection

(a) of this section shall have the right to stay compliance with

the order or subpoena if, not later than the 14th day after the

day the notice is given in the manner provided in Subsection

(a)(2) of this section:

(A) notice in writing is given to the person ordered or

subpoenaed not to comply with the order or subpoena;

(B) a copy of the notice not to comply with the order or

subpoena is mailed by registered or certified mail to the person

and to the office the comptroller directs in the notice referred

to in Subsection (a)(1) of this section; and

(C) suit is filed against the comptroller in a district court of

Travis County to stay compliance with the order or subpoena.

(c) No examination of any records required to be produced under

an order or subpoena as to which notice is required under

Subsection (a) of this section may be made:

(1) before the expiration of the 14-day period allowed for the

notice not to comply under Subsection (b)(2) of this section; or

(2) when the requirements of Subsection (b)(2) of this section

have been met, except in accordance with an order issued by a

district court of Travis County authorizing examination of the

records or with the consent of the person staying compliance.

(d) If any person takes any action as provided in Subsection (b)

of this section and such person is the person with respect to

whose liability the order or subpoena is issued under Section

111.0043 of this code (or is the agent, nominee, or other person

acting under the direction or control of such person), then the

running of any period of limitations under Subchapter D of this

chapter with respect to the person shall be suspended for the

period during which a proceeding and appeals of the proceeding

with respect to the enforcement of such order are pending.

(e) Any order or subpoena issued under Section 111.0043 of this

code that does not identify the person with respect to whose

liability the order is issued may be served only after a court

proceeding in which the comptroller establishes that:

(1) the order relates to the investigation of a particular

person or ascertainable group or class of persons;

(2) there is a reasonable basis for believing that the person or

group or class of persons may fail or may have failed to comply

with any provision of state law; and

(3) the information sought to be obtained from the examination

of the records (and the identity of the person or persons with

respect to whose liability the order is issued) is not readily

available from other sources.

(f) In the case of an order or subpoena issued under Section

111.0043 of this code, the provisions of Subsections (a)(1) and

(b) of this section may not apply if, upon petition by the

comptroller, the court determines, on the basis of the facts and

circumstances alleged, that there is reasonable cause to believe

the giving of notice may lead to attempts to conceal, destroy, or

alter records relevant to the examination, to prevent the

communication of information from other persons through

intimidation, bribery, or collusion, or to flee to avoid

prosecution, testifying, or production of records.

(g)(1) A district court of Travis County has jurisdiction to hear

and determine proceedings brought under Subsection (e) or (f) of

this section. The determinations required to be made under

Subsections (e) and (f) of this section shall be ex parte and

shall be made solely upon the petition and supporting affidavits.

An order denying the petition shall be deemed a final order that

may be appealed.

(2) Except for cases the court considers of greater importance,

a proceeding brought for the enforcement of any order, or a

proceeding under this section, and appeals, take precedence on

the docket over all cases and shall be assigned for hearing and

decided at the earliest practicable date.

(h) The comptroller shall by rule establish the rates and

conditions for payments to reimburse reasonably necessary costs

directly incurred by third-party recordkeepers in searching for,

reproducing, or transporting books, papers, records, or other

data required to be produced by order or subpoena upon request of

the comptroller. The reimbursement shall be in addition to

mileage and fees paid under Subsections (d)(1) and (d)(2) of

Section 111.0043 of this code.

Acts 1981, 67th Leg., p. 1499, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0045. USE OF OUTSIDE PERSONNEL; DELEGATION OF POWERS.

(a) As necessary to enhance productivity, the comptroller may

employ or contract for the services of accountants, assistants,

auditors, clerks, information technology specialists, and

investigators to:

(1) provide or use the equipment acquired under Subchapter G;

and

(2) assist with the administration of this code.

(b) The comptroller may delegate to persons employed or

contracted under this section the power to perform duties as

required.

Added by Acts 2001, 77th Leg., ch. 1272, Sec. 5.03, eff. June 15,

2001.

Sec. 111.00455. CONTESTED CASES CONDUCTED BY TAX DIVISION OF

STATE OFFICE OF ADMINISTRATIVE HEARINGS. (a) The tax division

of the State Office of Administrative Hearings shall conduct any

contested case hearing as provided by Section 2003.101,

Government Code, in relation to the collection, receipt,

administration, and enforcement of:

(1) a tax imposed under this title; and

(2) any other tax, fee, or other amount that the comptroller is

required to collect, receive, administer, or enforce under a law

not included in this title.

(b) The following are not contested cases under Subsection (a)

and Section 2003.101, Government Code:

(1) a show cause hearing or any hearing not related to the

collection, receipt, administration, or enforcement of the amount

of a tax or fee imposed, or the penalty or interest associated

with that amount, except for a hearing under Section 151.157(f),

151.1575(c), 151.712(g), 154.1142, or 155.0592;

(2) a property value study hearing under Subchapter M, Chapter

403, Government Code;

(3) a hearing in which the issue relates to:

(A) Chapters 72-75, Property Code;

(B) forfeiture of a right to do business;

(C) a certificate of authority;

(D) articles of incorporation;

(E) a penalty imposed under Section 151.7031;

(F) the refusal or failure to settle under Section 111.101; or

(G) a request for or revocation of an exemption from taxation;

and

(4) any other hearing not related to the collection, receipt,

administration, or enforcement of the amount of a tax or fee

imposed, or the penalty or interest associated with that amount.

(c) A reference in law to the comptroller that relates to the

performance of a contested case hearing described by Subsection

(a) means the tax division of the State Office of Administrative

Hearings.

Added by Acts 2007, 80th Leg., R.S., Ch.

354, Sec. 1, eff. June 15, 2007.

Sec. 111.00457. INFORMATION RELATING TO OTHER PERMIT OR LICENSE

REQUIREMENTS. (a) The comptroller shall include the following

statement on each application for a permit or license issued by

the comptroller:

WARNING. You may be required to obtain an additional permit or

license from the State of Texas or from a local governmental

entity to conduct business. A listing of links relating to

acquiring licenses, permits, and registrations from the State of

Texas is available online at

https://www.TexasOnline.com/portal/tol/en/9/1. You may also want

to contact the municipality and county in which you will conduct

business to determine any local governmental requirements.

(b) The statement required by Subsection (a) must be placed in

the applicant signature box or, if the application does not have

an applicant signature box, on the last line above the applicant

signature line, and in bold typeface that is at least as large as

any other typeface appearing in the general instructions relating

to the application.

(c) The comptroller shall revise the statement required by

Subsection (a) as necessary to reflect any change in the Internet

address that provides the listing of links.

Added by Acts 2009, 81st Leg., R.S., Ch.

302, Sec. 1, eff. June 19, 2009.

Sec. 111.0046. PERMIT OR LICENSE. (a) The comptroller shall

refuse to issue or renew any permit or license to a person who:

(1) is not permitted or licensed as required by law for a

different tax or activity administered by the comptroller, except

if the issuance or renewal of such license or permit is pending

before the comptroller; or

(2) is currently delinquent in the payment of any tax collected

by the comptroller.

(b) The comptroller by rule may establish a minimum age for a

person to be eligible to apply for a permit or license issued by

the comptroller.

Added by Acts 1985, 69th Leg., ch. 59, Sec. 1, eff. April 30,

1985. Amended by Acts 2003, 78th Leg., ch. 209, Sec. 13, eff.

Oct. 1, 2003.

Sec. 111.0047. SUSPENSION AND REVOCATION OF PERMIT OR LICENSE.

(a) If a person fails to comply with any provision of this title

or with a rule of the comptroller adopted under this title, the

comptroller, after a hearing, may revoke or suspend any permit or

license issued to the person.

(b) A person whose permit or license the comptroller proposes to

revoke or suspend under this section is entitled to 20 days'

written notice of the time and place of the hearing on the

revocation or suspension. At the hearing the person must show

cause why each permit or license should not be suspended or

revoked.

(c) The comptroller shall give written notice of the revocation

or suspension of a permit or license to the holder of the permit

or license.

(d) Notices under this section may be served on the holder of

the permit or license personally or may be mailed to the holder's

address as shown in the records of the comptroller.

Added by Acts 1985, 69th Leg., ch. 59, Sec. 1, eff. April 30,

1985. Amended by Acts 1989, 71st Leg., ch. 238, Sec. 42, eff.

Jan. 1, 1990; Acts 1991, 72nd Leg., 1st C.S., ch. 6, Sec. 7; Acts

1993, 73rd Leg., ch. 107, Sec. 4.08, eff. Aug. 30, 1993; Acts

1993, 73rd Leg., ch. 284, Sec. 32, eff. Sept. 1, 1993; Acts 1997,

75th Leg., ch. 1040, Sec. 2, eff. Sept. 1, 1997.

Sec. 111.0048. REISSUED OR NEW PERMIT OR LICENSE AFTER

REVOCATION OR SUSPENSION. (a) A new permit or license may not

be issued to a former holder of a revoked permit or license

unless the comptroller is satisfied that the person will comply

with the provisions of this title and the rules of the

comptroller relating to this title.

(b) The comptroller may prescribe the terms under which a

suspended permit or license may be reissued.

Added by Acts 1985, 69th Leg., ch. 59, Sec. 1, eff. April 30,

1985. Amended by Acts 1989, 71st Leg., ch. 238, Sec. 43, eff.

Jan. 1, 1990; Acts 1991, 72nd Leg., 1st C.S., ch. 6, Sec. 8; Acts

1993, 73rd Leg., ch. 107, Sec. 4.09, eff. Aug. 30, 1993; Acts

1993, 73rd Leg., ch. 284, Sec. 33, eff. Sept. 1, 1993; Acts 1997,

75th Leg., ch. 1040, Sec. 3, eff. Sept. 1, 1997.

Sec. 111.0049. APPEALS. A taxpayer may appeal the revocation or

suspension of a permit or license under Section 111.0046 and

111.0047 of this code in the same manner that appeals are made

from a final deficiency determination.

Added by Acts 1985, 69th Leg., ch. 59, Sec. 1, eff. April 30,

1985.

Sec. 111.005. GOVERNMENTAL ENTITIES TO COOPERATE. Each

department, officer, and employee of the state or of a local

governmental entity shall cooperate with and give reasonable

assistance and information to the comptroller when performing

authorized duties.

Acts 1981, 67th Leg., p. 1502, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.006. CONFIDENTIALITY OF INFORMATION. (a) The

following matter is confidential and may not be used publicly,

opened to public inspection, or disclosed except as permitted by

this section:

(1) a federal tax return or federal tax return information

required to have been submitted to the comptroller with a state

tax return or report; and

(2) all information secured, derived, or obtained by the

comptroller or the attorney general during the course of an

examination of the taxpayer's books, records, papers, officers,

or employees, including an examination of the business affairs,

operations, source of income, profits, losses, or expenditures of

the taxpayer.

(b) All information made confidential in this title may not be

subject to subpoena directed to the comptroller or the attorney

general except in a judicial or an administrative proceeding in

which this state, another state, or the federal government is a

party.

(c) The comptroller or the attorney general may use information

or records made confidential by provisions of this title to

enforce any provisions of this title or may authorize their use

in a judicial or an administrative proceeding in which this

state, another state, or the federal government is a party.

(d) The comptroller or the attorney general may disclose to a

municipality or county the information described by Subsection

(a)(2) if:

(1) the information was derived from an examination performed

for the purpose of ascertaining compliance with the hotel

occupancy tax imposed under Chapter 156;

(2) the municipality or county makes a written request for the

information;

(3) the municipality or county making the request has imposed a

local hotel occupancy tax authorized by Chapter 351 or 352, as

applicable;

(4) the municipality or county uses the information only for the

enforcement or administration of its local hotel occupancy tax;

and

(5) to the extent consistent with the use authorized by

Subdivision (4), the municipality or county keeps the information

confidential as provided by this section.

(e) Information made confidential in this title may be examined

by a state officer, a law enforcement officer of this state, a

tax official of another state, a tax official of the United

Mexican States, an official of the United States, or an

authorized representative of any of these officers or officials,

if:

(1) the comptroller authorizes the examination; and

(2) for an official or officer of another state, the United

States, or the United Mexican States, a reciprocal agreement

exists allowing the comptroller to examine tax information under

the control of the officer or official in a manner substantially

equivalent to the officer's or official's access to information

under this subsection.

(f) Subsection (a)(2) does not apply to information obtained by

the comptroller or the attorney general during an examination of

a governmental body, as that term is defined in Section 552.003,

Government Code. However, information obtained by the comptroller

or the attorney general during an examination of the governmental

body that is confidential under law when in the possession of the

governmental body remains confidential while in the possession of

the comptroller or the attorney general.

(g) Information made confidential by Subsection (a)(2) that

relates to a taxpayer's responsibilities under Chapter 162 may be

examined by an official of another state or of the United States

if:

(1) the official has information that would assist the

comptroller in administering Chapter 162;

(2) the comptroller is conducting or may conduct an examination

or a criminal investigation of the taxpayer that is the subject

of the information made confidential by Subsection (a)(2); and

(3) a reciprocal agreement exists allowing the comptroller to

examine information under the control of the official in a manner

substantially equivalent to the official's access to information

under this subsection.

Acts 1981, 67th Leg., p. 1502, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1995, 74th Leg., ch. 175, Sec. 1, eff.

Sept. 1, 1995; Acts 1995, 74th Leg., ch. 351, Sec. 4, eff. Sept.

1, 1995; Acts 1997, 75th Leg., ch. 165, Sec. 29.10, eff. Sept. 1,

1997; Acts 1997, 75th Leg., ch. 1040, Sec. 4, eff. Sept. 1, 1997;

Acts 1999, 76th Leg., ch. 1218, Sec. 2, eff. Sept. 1, 1999.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

1227, Sec. 2, eff. September 1, 2009.

Sec. 111.007. CRIMINAL PENALTIES FOR DISCLOSING FEDERAL TAX

INFORMATION. (a) The comptroller, a person who formerly held

the office of comptroller, or an employee or former employee of

the comptroller commits an offense if he discloses in a manner

unauthorized by law a federal tax return or federal tax return

information that is required to be submitted to the comptroller

by any person.

(b) An offense under this section is a misdemeanor punishable by

a fine of not more than $1,000 or by confinement in jail for not

more than one year, or by both a fine and confinement.

Acts 1981, 67th Leg., p. 1502, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0075. USE OF INFORMATION RELATING TO TAX AUDITS. (a)

This section applies to information that:

(1) relates to a taxpayer that the comptroller is auditing or

intends to audit;

(2) is considered public information under Chapter 552,

Government Code; and

(3) is made available by the comptroller to a person who

requested that information under Chapter 552, Government Code.

(b) A person who obtains information described by Subsection (a)

and who is not a taxpayer to whom the information relates may

not, before the sixth day after the date the comptroller made the

information available to the person, use the information for the

direct solicitation of business or employment for pecuniary gain.

(c) If a direct solicitation of business or employment for

pecuniary gain is made by mail or by delivery by common or

contract carrier, the postmark or the receipt mark of the common

or contract carrier is prima facie evidence of the date the

information was used for that solicitation.

(d) A person who violates this section is subject to a civil

penalty of not more than:

(1) $500 for the first violation;

(2) $1,000 for the second violation; and

(3) $3,000 for each subsequent violation.

(e) At the request of the comptroller or the person to whom the

solicitation was directed, the attorney general or the

appropriate district or county attorney may institute and conduct

a suit to collect the penalty authorized by this section and to

restrain the person from continuing to violate this section.

(f) The penalty prescribed by this section is in addition to any

other penalty provided by law.

Added by Acts 2005, 79th Leg., Ch.

689, Sec. 1, eff. September 1, 2005.

Sec. 111.008. DEFICIENCY DETERMINATION. (a) If the comptroller

is not satisfied with a tax report or the amount of the tax

required to be paid to the state by a person, the comptroller may

compute and determine the amount of tax to be paid from

information contained in the report or from any other information

available to the comptroller.

(b) On making a determination under this section, the

comptroller shall notify the person against whom a determination

is made of the determination. The notice may be given by mail or

by personal service.

(c) If the notice is given by mail, it shall be addressed to the

taxpayer or other person at the taxpayer's address as it appears

in the records of the comptroller. Service by mail is complete

when the notice is deposited in a U.S. Post Office.

Acts 1981, 67th Leg., p. 1502, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.0081. WHEN PAYMENT IS REQUIRED. (a) Except as

provided in Subsections (b) and (c) of this section, the amount

of a determination made under this code is due and payable 10

days after it becomes final. If the amount of the determination

is not paid within 10 days after the day it became final, a

penalty of 10 percent of the amount of the determination,

exclusive of penalties and interest, shall be added.

(b) This section does not apply to a determination under Section

111.022.

(c) The amount of a determination made under this code is due

and payable 20 days after a comptroller's decision in a

redetermination hearing becomes final. If the amount of the

determination is not paid within 20 days after the day the

decision became final, a penalty of 10 percent of the amount of

the determination, exclusive of penalties and interest, shall be

added.

Added by Acts 1985, 69th Leg., ch. 37, Sec. 9, eff. Aug. 26,

1985. Amended by Acts 2001, 77th Leg., ch. 1263, Sec. 8, eff.

Sept. 1, 2001.

Sec. 111.009. REDETERMINATION. (a) A person having a direct

interest in a determination may petition the comptroller for a

redetermination.

(b) A petition for redetermination must be filed before the

expiration of 30 days after the date on which the service of the

notice of determination is completed or the redetermination is

barred. If a petition for redetermination is not filed before the

expiration of the period provided by this subsection, the

determination is final on the expiration of the period.

(c) If the petition requests a hearing on the redetermination,

the person filing the petition is entitled to a hearing and to

receive notice of the hearing at least 20 days before the day of

the hearing.

(d) An order or decision of the comptroller on a petition for

redetermination becomes final 20 days after service on the

petitioner of the notice of the order or decision.

Acts 1981, 67th Leg., p. 1503, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1991, 72nd Leg., ch. 705, Sec. 2, eff.

Sept. 1, 1991.

Sec. 111.010. SUIT TO RECOVER TAXES. (a) The attorney general

shall bring suit in the name of the state to recover delinquent

state taxes, tax penalties, and interest owed to the state.

(b) This section applies to state taxes imposed by this title or

by other laws not included in this title but does not apply to

the state ad valorem tax on property.

(c) Venue for and jurisdiction of a suit arising under this

section is exclusively conferred upon the district courts of

Travis County.

(d) The state is entitled to interest at the rate of 10 percent

a year on the amount of a judgment for the state beginning on the

day the judgment is signed and ending on the day the judgment is

satisfied.

Acts 1981, 67th Leg., p. 1503, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1983, 68th Leg., p. 519, ch. 107, Sec. 2,

eff. Sept. 1, 1983; Acts 1991, 72nd Leg., ch. 705, Sec. 3, eff.

Sept. 1, 1991; Acts 1995, 74th Leg., ch. 1000, Sec. 1, eff. Oct.

1, 1995.

Sec. 111.0102. SUIT CHALLENGING COLLECTION ACTION. Venue for

and jurisdiction of a suit that challenges or is for the purpose

of avoiding a comptroller collection action or state tax lien in

any manner is exclusively conferred on the district courts of

Travis County.

Added by Acts 2007, 80th Leg., R.S., Ch.

931, Sec. 1, eff. June 15, 2007.

Sec. 111.011. TAX COLLECTIONS AND REPORTS BY BUSINESSES;

ENFORCEMENT OF DUTIES. (a) If a person engaged in a business

the operation of which involves the receipt, collection, or

withholding of a tax imposed by this title fails to file a report

or pay the tax as required by this title, the attorney general

may bring suit for an injunction prohibiting the person from

continuing in that business until the report is filed and the tax

is paid.

(b) If a person engaged in business the operation of which

involves the receipt, collection, or withholding of a tax imposed

by this title receives, collects, or withholds more tax than is

authorized by law to be received, collected, or withheld or if

the person receives, collects, or withholds money from any other

person under a claim or representation that the receipt,

collection, or withholding is a tax imposed by this title or

other law and the amount received, collected, or withheld is not

a tax authorized by law, and the person does not voluntarily

comply with the notice set forth in Subsection (c) herein, the

attorney general shall bring suit for an injunction prohibiting

the person from the wrongful receipt, collection, or withholding

of the tax or alleged tax.

(c) Prior to filing suit for an injunction, the attorney general

shall send written notice by certified mail requesting that the

person shall cease any wrongful collections of taxes allowing 15

days for compliance from the date of notice.

(d) The venue for a suit under this section is in Travis County.

Acts 1981, 67th Leg., p. 1503, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1985, 69th Leg., ch. 177, Sec. 1, eff.

Sept. 1, 1985.

Sec. 111.012. SECURITY FOR THE PAYMENT OF TAXES. (a) If the

comptroller finds that a tax imposed by this title is insecure,

the comptroller may require a taxpayer to:

(1) provide security for the payment of taxes; or

(2) establish a tax escrow account at a bank or other financial

institution.

(b) The security may consist of:

(1) a cash deposit filed with the comptroller;

(2) a surety bond; or

(3) other security as permitted by the comptroller.

(c) The amount and form of the security shall be set by the

comptroller, except that the amount may not be more than double

the amount of taxes that the comptroller estimates will be due

from the taxpayer during the succeeding 12 months.

(d) The comptroller shall give notice to a taxpayer from whom

security or the establishment of a tax escrow account is required

under this section.

(e) The tax escrow account must be established not later than

the 10th day after the date notice is received from the

comptroller requiring the establishment of the account.

(f) Before the comptroller requires a taxpayer to establish a

tax escrow account, the comptroller must determine that:

(1) the taxpayer remitted or should have remitted a monthly

average of $500 or more in tax collected from customers for the

six-month period preceding the date that the notice requiring the

establishment of a tax escrow account is sent by the comptroller

to the taxpayer; and

(2) the taxpayer:

(A) failed to file two or more tax returns during the 12 months

preceding the date that the notice requiring the establishment of

a tax escrow account is sent by the comptroller to the taxpayer;

(B) has been issued a jeopardy determination under Section

111.022;

(C) has previously been determined to have collected tax but not

remitted that tax under an administrative hearings decision

issued by the comptroller;

(D) is insolvent because the taxpayer's liabilities exceed the

taxpayer's assets or the taxpayer is unable to pay the taxpayer's

debts as they become due;

(E) has assets that are subject to a court administered

receivership; or

(F) has been notified that security is required under this

section but has failed to provide evidence of the security on or

before the 30th day after the date the security was requested.

(g) If a taxpayer does not furnish security to the comptroller

or establish a tax escrow account as required by the comptroller

before the expiration of 10 days following the day on which

notice is received, the comptroller may:

(1) bring suit in a district court in Travis County for an order

enjoining the taxpayer from engaging in business until the

security is furnished or the tax escrow account is established;

or

(2) pursue any other remedies or collection actions available to

the comptroller under this chapter or Chapter 113 to ensure the

security is furnished or the tax escrow account is established.

Acts 1981, 67th Leg., p. 1503, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1991, 72nd Leg., ch. 483, Sec. 1, eff.

Sept. 1, 1991; Acts 2003, 78th Leg., ch. 209, Sec. 14, eff. Oct.

1, 2003.

Sec. 111.013. EVIDENCE: TAX CLAIMS. (a) In a suit involving

the establishment or collection of a tax imposed under Title 2 or

3 of this code, a certificate of the comptroller that shows a

delinquency is prima facie evidence of:

(1) the stated tax or amount of the tax, after all just and

lawful offsets, payments, and credits have been allowed;

(2) the stated amount of penalties and interest;

(3) the delinquency of the amounts; and

(4) the compliance of the comptroller with the applicable

provisions of this code in computing and determining the amount

due.

(b) The defendant may not deny a claim for taxes, penalties, or

interest unless the defendant timely files a sworn written denial

that specifically identifies the taxes, penalties, and interest

the defendant asserts are not due and the amounts of tax,

penalties, and interest that are not due.

Acts 1981, 67th Leg., p. 1504, ch. 389, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1991, 72nd Leg., ch. 705, Sec. 4, eff.

Sept. 1, 1991.

Sec. 111.014. EVIDENCE: COPIES OF GRAPHIC MATTER. (a) A copy

of graphic matter is admissible, without further proof, in a

judicial or administrative proceeding concerning the

administration or enforcement of a tax imposed by this title if:

(1) the copy or information contained in the copy is relevant;

(2) the copy is a reproduction made by a photographic,

photostatic, magnetic, or other process that accurately

duplicates or forms a durable medium for accurately reproducing

the original matter or information contained in the original

matter; and

(3) the graphic matter was kept or recorded by the comptroller

in the performance of official functions.

(b) "Graphic matter" means a memorandum, entry, report, or other

document, a record of information contained in a memorandum,

entry, report, or other document, or a record of an action taken

by the comptroller.

(c) The admissibility of a copy of graphic matter as allowed

under this section does not affect the admissibility of the

original matter or other competent evidence offered to show the

incorrectness of the copy or of information reflected in the

copy.

Acts 1981, 67th Leg., p. 1504, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.015. REMEDIES CUMULATIVE. The rights, powers,

remedies, liens, and penalties provided by this title are

cumulative of other rights, powers, remedies, liens, and

penalties for the collection of taxes provided by this title and

by other law.

Acts 1981, 67th Leg., p. 1504, ch. 389, Sec. 1, eff. Jan. 1,

1982.

Sec. 111.016. PAYMENT TO THE STATE OF TAX COLLECTIONS. (a) Any

person who receives or collects a tax or any money represented to

be a tax from another person holds the amount so collected in

trust for the benefit of the state and is liable to the state for

the full amount collected plus any accrued penalties and interest

on the amount collected.

(a-1) A person is presumed to have received or collected a tax

or money represented to be a tax for the purpose of this section

if the person files, or causes to be filed, a tax return or

report with the comptroller showing tax due. A person, including

a person who is on the accrual method of accounting, may rebut

this presumption by