TITLE 34. PUBLIC FINANCE

PART 1. COMPTROLLER OF PUBLIC ACCOUNTS

CHAPTER 3. TAX ADMINISTRATION

SUBCHAPTER O. STATE AND LOCAL SALES AND USE TAXES

34 TAC §3.355

The Comptroller of Public Accounts adopts amendments to §3.355, concerning insurance services, without changes to the proposed text as published in the March 16, 2018, issue of the Texas Register (43 TexReg 1613). The amendments implement Senate Bill 1083, 85th Legislature, 2017, which revises the definition of "insurance services" in Tax Code, §151.0039 ("Insurance Service"). Senate Bill 1083 is effective January 1, 2018.

Subsection (a) addresses definitions. The comptroller adds new paragraph (1) to define the term "affiliated group" using the definition cross-referenced in Tax Code, §151.0039(c) ("Insurance Service"). The comptroller adds new paragraph (2) to define the term "certified public accountancy firm." The comptroller derives the proposed definition from the definition of the term in Occupations Code, §901.002 (General Definitions), which Tax Code, §151.0039(c) references. The comptroller adds new paragraph (3) to define the term "controlling interest," which appears in the definition of "affiliated group." The comptroller gives this term the meaning assigned by Tax Code, §171.0001(8) (General Definitions). The comptroller renumbers subsequent paragraphs accordingly.

Subsection (c) addresses nontaxable insurance services. The comptroller adds new paragraphs (5) and (6) to implement the provision in Senate Bill 1083 excluding insurance services provided by or on behalf of certain certified public accountancy firms from the definition of taxable insurance services.

The comptroller amends subsection (d) to update a reference to subsection (a)(10) due to renumbering of paragraphs.

No comments were received regarding adoption of the amendment.

The amendments are adopted under Tax Code, §111.002 (Comptroller's Rules; Compliance; Forfeiture) which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of Tax Code, Title 2.

The amendments implement Tax Code, §151.0039 ("Insurance Service").

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 17, 2018.

TRD-201801657

William Hamner

Special Counsel for Tax Administration

Comptroller of Public Accounts

Effective date: May 7, 2018

Proposal publication date: March 16, 2018

For further information, please call: (512) 475-0387