Entering Texas Deductions and Tax Adjustments in ProConnect

To enter Allowable Deductions:

1. From the Input Return tab, go to State & Local ⮕ Taxes ⮕ Texas Franchise Tax.
2. Go to the Adjustments & Apportionment tab at the top of the screen.
3. Enter amount in Allowable Deductions.

Enter the amount of allowable deductions to be subtracted from apportioned margin. The following are the allowable deductions:

1. A taxable entity may deduct 10 percent of the amortized cost of a solar energy device if the device meets the criteria in Sec 171.107(b). The deduction may not reduce apportioned margin below zero, and no carryover of unused deduction is allowed.
2. A taxable entity may deduct 10 percent of the amortized cost of equipment used in a clean coal project if the equipment meets the criteria in Sec 171.108(b). The deduction may not reduce apportioned margin below zero, and no carryover of unused deduction is allowed.

Use Calculation method: 1=COGS, 2=compensation, 3=70%, 4=EZ, 5=less 1 million [O] to override the programs method of calculating Texas Franchise tax, Enter 1 to use the Cost of Goods Sold method, Enter 2 to use the Compensation method, Enter 3 to use the Percentage (70%) method, Enter 4 to use the EZ method or Enter 5 to use the less one million dollars method.