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Ezel / Tax Rulings / TX
TX 9712509L Franchise Tax (PRIOR TO 01/01/2008) 1997-12-16

How were zero Texas receipts, an apportionment ratio over 100%, and weekend due dates handled on 1997 Texas franchise-tax reports?

Short answer: On Form 05-147, zero Texas gross receipts meant entering zero in Item 23 and leaving lines 17-22 blank. Texas receipts could not exceed receipts everywhere, so the apportionment factor could not exceed 100%. If an original or extended report due date fell on a Saturday, Sunday, or listed legal holiday, it moved to the next business day; the letter applied the same business-day rule to the 60th day used for interest accrual.

Apply this to your situation

This page answers the general question as of 1997. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1997
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is an official Texas Comptroller of Public Accounts letter published on the State Tax Automated Research (STAR) system. Letters on STAR can be the basis of a detrimental reliance claim only for the taxpayer to whom the letter was directly issued (see 34 Tex. Admin. Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded. The instructions apply to historical Forms 05-147 and 05-139 and the 1997-1998 deadlines described in the letter. Confirm current forms, holiday lists, due-date, and interest rules. Taxpayer-identifying details are redacted. This summary is informational only and is not legal or tax advice. Consult a licensed Texas tax professional about your specific situation.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page) is the authoritative source for any reliance.

Plain-English summary

The letter gave three filing instructions for the former annual and final franchise-tax reports.

  • With zero Texas gross receipts on Form 05-147, the taxpayer entered zero in Item 23 and left lines 17 through 22 blank.
  • The apportionment factor could not exceed 100% because Texas gross receipts could not exceed gross receipts everywhere.
  • An original or extended report deadline falling on a Saturday, Sunday, or listed legal holiday moved to the next business day.

For a business ceasing on December 31, 1997, the final report deadline moved from Sunday, March 1 to Monday, March 2, 1998. The letter also said the 60th day used when calculating interest could not fall on a weekend or listed legal holiday and moved to the next business day.

What this means for you

Historical return preparers

The response addressed specific line instructions and calendar rules for Forms 05-147 and 05-139.

Tax professionals

Do not apply these obsolete form-line references to current reports without checking the current form and instructions.

Common questions

Q: Could the apportionment factor exceed 100%?
A: No.

Q: Did a Sunday due date remain due Sunday?
A: No. It moved to the next business day.

Citations and references

  • The ruling identifies no statute or rule by section number

Source

Original ruling text

December 16, 1997

Dear **:

In your FAX of December 8, you requested information regarding the proper
completion of Schedule B of the regular annual franchise tax report (Form
05-147) and the final franchise tax report (Form 05-139).

I have restated your questions followed by a response:

  1. Form 05-147, line 16 states that if there are "0" gross receipts in Texas,
    enter "0" in Item 23 and complete the remainder of the report. Does this mean
    that lines 17 through 22 should be blank and not completed?

Response

Yes.

  1. Form 05-147, line 18 Apportionment Factor: Should this amount be limited
    to 100% if the apportionment ratio happens to exceed 100%?

Response

The Texas gross receipts cannot exceed the gross receipts everywhere.
Therefore, the apportionment factor cannot exceed 100%.

  1. Form 05-139: If the 60th day falls on a Saturday or Sunday, will the due
    date be that Saturday or Sunday or does Texas allow for the Monday following
    (1st business workday)? If Texas does not allow for the 1st business workday,
    does interest begin on the 61st day if the 60th day falls on a Saturday. For
    example, a business ceasing on 12/31/97 60th day would fall on March 1, 1998 (a
    Sunday). Would the due date be 3/1/98 or 3/2/98?

Response

If the original or extended due date for a report falls on a Saturday, Sunday,
or legal holiday included on the list published before January 1 of each year
in the Texas Register, the due date of the report will be the next business
day. Therefore, if a business ceased doing business on 12/31/97, the due date
for the final report would be 3/2/98.

If you are calculating the date upon which interest begins to accrue, the 60th
day after the due date cannot fall on a Saturday, Sunday, or legal holiday (as
defined above). In this situation, the 60th day will be the next business day.

This response is based on the facts presented and current law. If there are
different or additional facts, the response may change.

If you have any questions, contact Tax Policy Division. You may call toll free
1-800-531-5441, or our regular number is 512/463-4600. My extension is 3-4662.
You may write me at Tax Policy Division, Comptroller of Public Accounts.

Sincerely,

Bob Jeffcoat
Tax Policy Division

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