Today's Law As Amended


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AB-1258 Personal income taxes: exclusion: servicemembers.(2019-2020)



As Amends the Law Today


SECTION 1.

 Section 17140.7 is added to the Revenue and Taxation Code, to read:

17140.7.
 (a) For taxable years beginning on or after January 1, 2020, and before January 1, 2030, gross income shall not include active duty pay received by a servicemember, while on active duty in this state, in the United States Armed Forces, in the reserve components of the United States Armed Forces, or in the National Guard.
(b) For taxable years beginning on or after January 1, 2020, and before January 1, 2030, gross income shall not include military retirement pay received during the applicable time period by a servicemember who has been honorably discharged from the United States Armed Forces, the reserve components of the United States Armed Forces, or the National Guard.
(c) For purposes of this section, “applicable time period” means the period of time beginning on the date a servicemember in the United States Armed Forces, in the reserve components of the United States Armed Forces, or in the National Guard is honorably discharged and ends after a period of time equal to that of the servicemember’s cumulative days of active duty service prior to the honorable discharge. The applicable time period shall be confirmed by the Secretary of Veterans Affairs.
(d) The Department of Veterans Affairs may adopt rules and regulations for the purpose of confirming the applicable time period pursuant to subdivision (c).
(e) This section shall be repealed on December 1, 2030.
SEC. 2.
 (a) It is the intent of the Legislature to apply the requirements of Section 41 of the Revenue and Taxation Code to this act.
(b) The goal of this act adding Section 17140.7 to the Revenue and Taxation Code is to honor the service of California’s service members and veterans, provide fiscal relief to service members and veterans, and to incentivize veterans to remain in California upon their honorable discharge.
(c) The Legislature will measure the success of this act in meeting that goal by evaluating the number of active duty service members and veterans taking advantage of the income tax exclusion program, the economic stability of California’s veterans population, and whether there is a decrease in the number of veterans leaving California by the date of the bill’s inoperative date.
(d) The Department of Veterans Affairs shall compile the information detailed in subdivision (c) and report to the Legislative Analyst’s Office on or before December 1, 2030. The Legislative Analyst’s Office shall report it to the Legislature. The information in the report shall be compiled in an aggregate manner to preserve taxpayer confidentiality.
(e) Notwithstanding Section 19542 of the Revenue and Taxation Code, the Franchise Tax Board shall provide the Department of Veterans Affair with any information necessary to compile the information for the report required pursuant to this section. Taxpayer information received pursuant to this section by the Department of Veterans Affairs is subject to Section 19542 of the Revenue and Taxation Code.
SEC. 3.
 No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.
SEC. 4.
 This act provides for a tax levy within the meaning of Article IV of the California Constitution and shall go into immediate effect.