IncludedIn Opinlon,No.C-519
IylLL WILSON A-l-roRNEY OENIDIIAI. September16, 1960
Mr. R. E. Swift OpinionNo. W-935 County Attorney AndersonCounty Re: Permlsslblllty of deducting Palestine,Texas reservefor bad debt8 aet up by NationalRank pursuant to FederalRuling8In arriving at the value of ehareholder8e sh@reafor state and county Dear Mr. Swift: ad valoremtax purposes. We quote the r0n0ting excqrptfrom your letter requesting Our opinionon the above captionedmatter. "For state and countytax purpoees,la a NationalBank requiredto .includein Its capitalstructurea reservefor bad debts set up under the federal. statuteor ruling eometlmetireferredto 88 the.'20year moving average'statuteor z+lng? "Attachedhereto are two stat&mentamade by the bank In ,questlon,' one of them labeled statementA and the other labeledstatement B. "An inspectionof the two etatementa'will dlacloeea differenceor $98,505.33In the total llabllltlea.and capitalaccounts,and It le agreedby the bank in questionthat thle dlfll~rence.iaa reservefor bad debts set up under the followingrulings:
:
"Thlereservefor bad debta has been set up under the above statuteor ruU.ng and the bank In questionhae.atatedthat the limit .oithese reservesunder the~federalt3tatUte or ruling haa not been exceeded. Included ln OpinionNo. c-gig
Mr. R. E. Swift, Page 2 OpinionNo. A-935
"Thisbank takes the positionthat this reserveaccountshould not be includedin determlnlngthe assetsof'thebank subject to state and co&y sd valoremtaxes. II . . . , 'lTheother banks ln Palestinedo notihave any such specialreserveset up for bad debts under the federalstatuteor yullng. I was requestedto ask your opinionthat lf,the bank which has,the large reserve~for bad debt8 was not requiredto IncludeIt as part of the assetsof the bank in order to determlne the value of the sharesand thus determinethe tax llabllltyfor the shareholders, would the other banks be permlttedto deduct from their capitalaccount8a proptrtlonate sum of their respectivetotal'loans. Article7165'and 7166 Veryon'sblvll Statutes,set out in full in the footnotebelow, providefor the assessmentof
iArticle7165 reads as roiioti6: %er$ bank, whether 0r leatie or deposit, banker,broker,deal~rlnexehange,orstodc ~jobber,shall at the tlme ilxed by this chapter., for listingpersonalproperty,make out and fui%lsh~theassessorof taxes a sworn statement showingt "1. If a nationalbank, the presidentor Soas other officerof such bank shall furnishto the astlessorof the county ln which such bank Is locateda list of the names of all the shareholdsrs of the stock,togetherwith the number and amount oi the sharesof each stockholderof stock In said bank3 and the shareholders of the stobk in nationalbanks shall render to ths tax assessor,oi' the oounty In which said bank ls.locatedthe nwitber of their sharesand the true and full value there- Of. All sharesoi stocksln nationalbanks not renderedto the assessorof taxes In the aounty where such bank.18locatedwithin the time pre- scribedby law for listingpropertyfor taxes shall~ be assessedby the assessoragainstthe owner or owners thereofas unrenderedproperty.18assessed; but the tax roll shall show the name of'theowner or owners thereof'a8 per statementfurnishedby the presidentor other officersof said bank. Inaludedln OpinionNo: C-e NIT.R. E. Swift, Page 3 OpinionNo. WW-935
personaland real propertyof banks. In City of~Marshal1v. State Rank 127 S.W. 1083 (lbx.Clv.App.1gIb, errorrsr.1, the court held a state bankwas not liablefor any taxes'exoept 1 (cont .] "2. Nationalbanks shall render all otherbonds and stooksof everykind, exceptUnited Staeesbonds, and all shares 0s capitalstocksor joint