HBA-SEB S.B. 792 76(R)    BILL ANALYSIS


Office of House Bill AnalysisS.B. 792
By: Nixon, Drew
Energy Resources
5/10/1999
Engrossed



BACKGROUND AND PURPOSE 

Currently, there is some question as to whether companies that pay the
proceeds from the sale of gas are required to provide certain information
that would be useful to the payee for payment of federal taxes.  Many
companies already provide this information, but no definite requirement
exists.  S.B. 792 would require a payor of proceeds from the sale of gas to
provide a statement with the information necessary to compute the federal
income tax credit for the gas for which payment was made in the preceding
year.  This bill provides that the information must include identifying
information about the lease, property, or well and the volume of gas
measured. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Subchapter J, Chapter 91, Natural Resources Code, by
adding Section 91.408, as follows: 

Sec. 91.408.  INFORMATION FOR PAYEES OF PROCEEDS OF PRODUCTION FROM CERTAIN
GAS WELLS.  Requires a payor of the proceeds from the sale of gas produced
from a tight formation as defined by Section 29(c)(2)(B), Internal Revenue
Code of 1986, to annually furnish the payee a statement providing the
information necessary to compute the federal income tax credit provided by
that section for the gas for which payment was made in the preceding year.
Establishes that this information includes identifying information about
the lease, property, or well and the volume of gas measured.   

SECTION 2.  Requires the statement described by Section 91.408, Natural
Resources Code, as added by this Act, to be furnished no later than March
15.  

SECTION 3.  Effective date: September 1, 1999.

SECTION 4.  Emergency clause.