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SB-295 Personal income taxes: Fire Safe Home Tax Credits.(2019-2020)



SECTION 1.
 The credits allowed by Sections 17052.13 and 17052.14 of the Revenue and Taxation Code, as added by this act, shall be known and may be cited as the Fire Safe Home Tax Credits.

SEC. 2.

 Section 17052.13 is added to the Revenue and Taxation Code, to read:

17052.13.
 (a) (1) For each taxable year beginning on or after January 1, 2020, and before January 1, 2025, there shall be allowed a credit against the “net tax,” as defined in Section 17039, to a qualified taxpayer who incurs qualified costs while performing qualified home hardening on a qualified property, in an amount determined pursuant to paragraph (2).
(2) The credit amount shall be in an amount equal to:
(A) Fifty percent of qualified costs incurred while performing qualified home hardening, not to exceed two thousand five hundred dollars ($2,500), if the qualified property is located in a moderate fire hazard severity zone, per taxable year.
(B) Fifty percent of qualified costs incurred while performing qualified home hardening, not to exceed five thousand dollars ($5,000), if the qualified property is located in a high fire hazard severity zone, per taxable year.
(C) Fifty percent of qualified costs incurred while performing qualified home hardening, not to exceed ten thousand dollars ($10,000), if the qualified property is located in a very high fire hazard severity zone, per taxable year.
(b) For purposes of this section:
(1) “High fire hazard severity zone” means land classified by the Director of Forestry and Fire Protection pursuant to Section 4202 of the Public Resources Code as within a high fire hazard severity zone.
(2) “Moderate fire hazard severity zone” means land classified by the Director of Forestry and Fire Protection pursuant to Section 4202 of the Public Resources Code as within a moderate fire hazard severity zone.
(3) “Very high fire severity zone” means either land classified by the Director of Forestry and Fire Protection pursuant to Section 4202 of the Public Resources Code as within a very high fire hazard severity zone or an area designated by the Director of Forestry and Fire Protection pursuant to Section 51178 of the Government Code that is not a state responsibility area.
(4) (A) “Qualified costs” means any actual out-of-pocket expense incurred and paid by the qualified taxpayer during the taxable year in which the credit allowed by this section is claimed, documented by receipt, for performing qualified home hardening.
(B) “Qualified costs” do not include either of the following:
(i) Costs of any inspection or certification fees, in-kind contributions, donations, or incentives.
(ii) Expenses paid by the qualified taxpayer from any grants awarded to the qualified taxpayer for performing qualified home hardening.
(5) (A) “Qualified home hardening” means the replacement or repair of structural features that are affixed to the qualified property and performed or implemented for the primary purpose of reducing risk to structures from wildland fire.
(B) For purposes of this paragraph, “structural features” includes any of the following structural features that meet the requirements of Chapter 7A of the California Building Code: roofs, exterior walls, vents, eave assemblies, decks, fences, driveways, and chimneys.
(6) “Qualified property” means a dwelling or housing unit that is located in a moderate fire hazard severity zone, high fire hazard severity zone, or very high fire hazard severity zone for which a homeowners’ exemption pursuant to Section 218 has been granted to the qualified taxpayer in the taxable year for which the credit allowed by this section is claimed.
(7) (A) “Qualified taxpayer” means a taxpayer who satisfies both of the following requirements:
(i) Has an adjusted gross income for the taxable year in which the credit allowed by this section is claimed that does not exceed four hundred thousand dollars ($400,000) in the case of spouses filing a joint return or two hundred thousand dollars ($200,000) for other individuals.
(ii) Owns a qualified property.
(B) “Qualified taxpayer” does not include a trust or an estate.
(c) Upon request, a qualified taxpayer shall provide receipts and documentation verifying qualified costs paid or incurred while performing qualified home hardening to the Franchise Tax Board.
(d) In the case where the credit allowed under this section exceeds the “net tax,” the excess credit may be carried over to reduce the “net tax” in the following taxable year, and succeeding eight taxable years, if necessary, or until the credit has been exhausted.
(e) In the case of two taxpayers filing a joint return, only one credit may be claimed. In the case of two taxpayers who may legally file a joint return but file separate returns, only one of the taxpayers may claim the credit allowed by this section.
(f) This section shall remain in effect only until December 1, 2025, and as of that date is repealed.

SEC. 3.

 Section 17052.14 is added to the Revenue and Taxation Code, to read:

17052.14.
 (a) For each taxable year beginning on or after January 1, 2020, and before January 1, 2025, there shall be allowed as a credit against the “net tax,” as defined in Section 17039, to a qualified taxpayer in an amount equal to 50 percent of qualified costs incurred by the taxpayer, not to exceed one thousand dollars ($1,000) per taxable year, while performing qualified vegetation management on qualified property.
(b) For purposes of this section:
(1) “High fire hazard severity zone” means land classified by the Director of Forestry and Fire Protection pursuant to Section 4202 of the Public Resources Code as within a high fire hazard severity zone.
(2) “Moderate fire hazard severity zone” means land classified by the Director of Forestry and Fire Protection pursuant to Section 4202 of the Public Resources Code as within a moderate fire hazard severity zone.
(3) “Very high fire severity zone” means either land classified by the Director of Forestry and Fire Protection pursuant to Section 4202 of the Public Resources Code as within a very high fire hazard severity zone or an area designated by the Director of Forestry and Fire Protection pursuant to Section 51178 of the Government Code that is not a state responsibility area.
(4) (A) “Qualified costs” means any actual out-of-pocket expense incurred and paid by the qualified taxpayer during the taxable year in which the credit allowed by this section is claimed, documented by receipt, for performing qualified vegetation management.
(B) “Qualified costs” do not include either of the following:
(i) Costs of any inspection or certification fees, in-kind contributions, donations, or incentives.
(ii) Expenses paid by the qualified taxpayer from any grants awarded to the qualified taxpayer for performing qualified vegetation management.
(5) “Qualified property” means a dwelling or housing unit that is located in a moderate fire hazard severity zone, high fire hazard severity zone, or very high fire hazard severity zone for which a homeowners’ exemption pursuant to Section 218 has been granted to the qualified taxpayer in the taxable year for which the credit allowed by this section is claimed.
(6) (A) “Qualified taxpayer” means a taxpayer who satisfies both of the following requirements:
(i) Has an adjusted gross income for the taxable year in which the credit allowed by this section is claimed that does not exceed four hundred thousand dollars ($400,000) in the case of spouses filing a joint return or two hundred thousand dollars ($200,000) for other individuals.
(ii) Owns a qualified property.
(B) “Qualified taxpayer” does not include a trust or an estate.
(7) “Qualified vegetation management” means any of the following activities that meet the requirements of Section 4291 of the Public Resources Code performed by the qualified taxpayer for the primary purpose of reducing risk to structures from wildland fire:
(A) The creation of defensible space around structures.
(B) The establishment of fuel breaks.
(C) The thinning of woody vegetation.
(D) The secondary treatment of woody fuels by lopping and scattering, piling, chipping, removing from site, or prescribed burning.
(c) Upon request, a qualified taxpayer shall provide receipts and documentation verifying qualified costs paid or incurred while performing qualified vegetation management to the Franchise Tax Board.
(d) In the case where the credit allowed under this section exceeds the “net tax,” the excess credit may be carried over to reduce the “net tax” in the following taxable year, and succeeding eight taxable years, if necessary, or until the credit has been exhausted.
(e) In the case of two taxpayers filing a joint return, only one credit may be claimed. In the case of two taxpayers who may legally file a joint return but file separate returns, only one of the taxpayers may claim the credit allowed by this section.
(f) This section shall remain in effect only until December 1, 2025, and as of that date is repealed.
SEC. 4.
 (a) It is the intent of the Legislature to comply with Section 41 of the Revenue and Taxation Code.
(b) For purposes of complying with Section 41 of the Revenue and Taxation Code, with respect to the Fire Safe Home Tax Credits the Legislature finds and declares as follows:
(1) The specific goals, purposes, and objectives of the credits are as follows:
(A) To increase wildfire preparedness by providing a tax incentive to property owners that live in fire-prone parts of the state.
(B) To compensate taxpayers for costly mitigation measures that prepare their homes for wildfire season.
(2) To measure whether the Fire Safe Home Tax Credits meet these goals, purposes, and objectives, the Legislative Analyst’s Office shall prepare a written report on the following:
(A) The number of taxpayers claiming either or both of the credits.
(B) The average credit amount claimed on tax returns.
(3) The Legislative Analyst’s Office shall provide the written report required by paragraph (2) to the Senate Committee on Governance and Finance, the Assembly Committee on Revenue and Taxation, and the Assembly Committee on Local Government. A report submitted pursuant to this paragraph shall be submitted in compliance with Section 9795 of the Government Code.
SEC. 5.
 This act provides for a tax levy within the meaning of Article IV of the California Constitution and shall go into immediate effect.