Reading 32.41 it appears to me that a check returned nsf is a bad check and a check on a closed account is theft.

Any other ideas out there?

Not necessarily. Look at 31.06 for the elements of the presumption for theft by Check. If under that, and the case law, you might have plain theft ( goods or services) based upon the value ladders.

I was thinking more specifically, is a check drawn on a closed account a "bad check" per the code?

32.41 Issuance of a Bad Check is a Class "C" misdemeanor that is committed by putting a bad check into commerce. Knowledge of insufficient funds is presumed if he had no account or if the check was NSF and he failed to pay after notice.

Theft by Check is a 31.03 or 31.04 offense (depending on whether property or service was taken) that typically makes use of the presumption set out at 31.06. The 31.06 presumption applies to NSF checks, Account Closed checks, and Stop Payment checks.

The difference between the offenses is that in a theft, the defendant obtains property by deception (ie giving a bad check) and in an IBC, the defendant just puts the bad paper in commerce. An example of an IBC is the giving of a bad check as payment for an existing debt. Not a theft, because the check does not induce the release of property or service, but Bad. Hence Issuance of a Bad Check.

What will all the hot check departments do when checks become obsolete?

When will the turning point come? That is, the day on which there will be more people trying to pass hot checks than good ones.