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AB-489 Income and bank and corporation taxes: credit: taxes.(1999-2000)

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Amended  IN  Assembly  May 19, 1999

CALIFORNIA LEGISLATURE— 1999–2000 REGULAR SESSION

Assembly Bill
No. 489

Introduced  by  Assembly Member Ducheny
 (Coauthor(s): Senator Alpert)

February 18, 1999

An act to add and repeal Sections 17052.26 and 23616 to of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.


LEGISLATIVE COUNSEL'S DIGEST


AB 489, as amended, Ducheny. Income and bank and corporation taxes: credit: taxes.
The Personal Income Tax Law and the Bank and Corporation Tax Law authorizes authorize various credits against the taxes imposed by those laws.
This bill would allow a credit, for taxable and income years beginning on or after January 1, 2000, and before January 1, 2007, in an amount equal to the costs paid or incurred by the taxpayer for unemployment insurance taxes and employment training taxes on tips reported by his, her, or its employees. The Franchise Tax Board would be required to report to the Legislature on the use of these credits.
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 1.

 Section 17052.26 is added to the Revenue and Taxation Code, to read:

17052.26.
 (a) For each taxable year beginning on or after January 1, 2000, and before January 1, 2007, there shall be allowed as a credit against the “net tax,” as defined in Section 17039, an amount equal to the costs paid or incurred during the taxable year by the taxpayer for unemployment insurance taxes and employment training taxes on tips reported by his or her employees pursuant to Section 13055 of the Unemployment Insurance Code.
(b)taxable year by the taxpayer on tips reported by his or her employees pursuant to Section 13055 of the Unemployment Insurance Code for unemployment insurance taxes and employment training taxes.
(b) For purposes of this section:
(1) “Unemployment insurance taxes” means employer contributions to the Unemployment Fund pursuant to Section 977 of the Unemployment Insurance Code.
(2) “Employment training taxes” means employer contributions to the Employment Training Fund pursuant to Section 976.6 of the Unemployment Insurance Code.
(3) “Tips” has the meaning provided in Section 927 of the Unemployment Insurance Code.
(c) In the case where the credit allowed under this section exceeds the “net tax,” the excess may be carried over to reduce the “net tax” for the succeeding 15 years, or until the credit is exhausted, whichever occurs first.

(c)

(d) No deduction shall be allowed as otherwise provided in this part for that portion of any costs paid or incurred for the taxable year which is equal to the amount of the credit allowed under this section attributable to those costs.
(e) This section remain in effect only until December 1, 2007, and as of that date is repealed.

SEC. 2.

 Section 23616 is added to the Revenue and Taxation Code, to read:

23616.
 (a) For each income year beginning on or after January 1, 2000, and before January 1, 2007, there shall be allowed as a credit against the “tax,” as defined in Section 23036, an amount equal to the costs paid or incurred during the income year by the taxpayer for unemployment insurance taxes and employment training taxes on tips reported by its employees pursuant to Section 13055 of the Unemployment Insurance Code.
(b)by the taxpayer on tips reported by his or her employees pursuant to Section 13055 of the Unemployment Insurance Code for unemployment insurance taxes and employment training taxes.
(b) For purposes of this section:
(1) “Unemployment insurance taxes” means employer contributions to the Unemployment Fund pursuant to Section 977 of the Unemployment Insurance Code.
(2) “Employment training taxes” means employer contributions to the Employment Training Fund pursuant to Section 976.6 of the Unemployment Insurance Code.
(3) “Tips” has the meaning provided in Section 927 of the Unemployment Insurance Code.
(c) In the case where the credit allowed under this section exceeds the “tax,” the excess may be carried over to reduce the “tax” for the succeeding 15 years, or until the credit is exhausted, whichever occurs first.

(c)

(d) No deduction shall be allowed as otherwise provided in this part for that portion of any costs paid or incurred for the income year which is equal to the amount of the credit allowed under this section attributable to those costs.
(e) This section shall remain in effect only until December 1, 2007, and as of that date is repealed.

SEC. 3.

 The Franchise Tax Board shall report to the Legislature by January 1, 2006, on the annual number of taxpayers claiming the credits allowed by this act and the value of the credits claimed for each year. This act provides for a tax levy within the meaning of Article IV of the Constitution and shall go into immediate effect.