Bill > HB5120

This bill creates a new franchise tax credit for taxable entities that construct nuclear projects in Texas, providing financial incentives for developing nuclear energy infrastructure. The bill defines "nuclear project" broadly to include nuclear power generation sites, reactors, reactor manufacturing facilities, nuclear fuel reprocessing facilities, and uranium enrichment facilities. Under the proposed legislation, a taxable entity can claim a tax credit equal to the lesser of 10% of the construction costs or $250 million for each nuclear project first placed in service during the reporting period. The credit is subject to a limitation that it cannot exceed the total franchise tax due, but any unused credit can be carried forward for up to 25 consecutive reporting periods. To claim the credit, entities must apply with their tax report and provide requested information to the comptroller. The credit generally cannot be transferred to another entity, with an exception for cases where substantially all of the entity's assets are transferred. The new tax credit provisions will apply to tax reports due on or after January 1, 2026, and the bill itself will take effect on that same date, providing a clear timeline for implementation and giving businesses advance notice of the new tax incentive.

Budget and Finance

https://capitol.texas.gov/BillLookup/History.aspx?LegSess=89R&Bill=HB5120