Currrent as of February 4, 2022
Senate Bill No. 1352
Introduced by Senator Stone
An act to add and repeal Section 17053.32 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.
LEGISLATIVE COUNSEL’S DIGEST
SB 1352, as amended, Stone. Personal income taxes: credit: ABLE account contributions.
The Personal Income Tax Law allows various credits against the taxes imposed by those laws.
This bill would allow a credit against those taxes for each taxable year beginning on or after January 1, 2019, and before January 1, 2024, in an amount equal to 20% of a qualified contribution, as defined, paid or incurred by a taxpayer during the taxable year, not to exceed $750.
This bill would take effect immediately as a tax levy.
Vote: majority Appropriation: no Fiscal Committee: yes Local Program: no
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
Section 17053.32 is added to the Revenue and Taxation Code, to read:
(a) For each taxable year beginning on or after January 1, 2019, and before January 1, 2024, there shall be allowed as a credit against the “net tax,” as defined in Section 17039, an amount equal to 20 percent of a qualified contribution paid or incurred by a taxpayer during the taxable year, not to exceed seven hundred fifty dollars ($750).
(b) For purposes of this section, “qualified contribution” means a contribution made to an ABLE account established pursuant to Chapter 15 (commencing with Section 4875) of Division 4.5 of the Welfare and Institutions Code, excluding tax-free rollovers.
(c) If the credit allowed by this section exceeds the “net tax,” the excess may be carried over to reduce the “net tax” in the following year, and the succeeding four years if necessary, until the credit is exhausted.
(d) Any deduction or credit otherwise allowed pursuant to this part for any amount contributed by the taxpayer upon which the credit is based shall be reduced by the amount of the credit allowed under this section.
(e) In accordance with Section 41, the purpose of this credit is to increase contributions to ABLE accounts. To measure whether the credit achieves its intended purpose, the Franchise Tax Board shall annually report the number of tax returns claiming the credit and the average credit amount on tax returns claiming the credit.
(f) This section shall remain in effect only until December 1, 2024, and as of that date is repealed.
This act provides for a tax levy within the meaning of Article IV of the California Constitution and shall go into immediate effect.