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AB-1942 California Earned Income Tax Credit: Earned Income Tax Credit Information Act.(2017-2018)

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Date Published: 01/29/2018 09:00 PM
AB1942:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Assembly Bill No. 1942


Introduced by Assembly Member Santiago

January 29, 2018


An act to amend Section 19852 of, and to add Section 18573 to, the Revenue and Taxation Code, relating to tax administration.


LEGISLATIVE COUNSEL'S DIGEST


AB 1942, as introduced, Santiago. California Earned Income Tax Credit: Earned Income Tax Credit Information Act.
The Personal Income Tax Law allows various credits against the taxes imposed by that law, including certain credits that are allowed in modified conformity to credits allowed by federal income tax laws. Federal income tax laws allow a refundable earned income tax credit (EITC) for certain low-income individuals who have earned income, as specified and who meet certain other requirements.
The Personal Income Tax Law, in modified conformity with federal income tax laws, allows an earned income credit against personal income tax, and a payment in excess of that credit amount, to an eligible individual that is equal to that portion of the EITC allowed by federal law as determined by the EITC adjustment factor as set forth in the annual Budget Act which, unless otherwise specified in that act, is 0%.
This bill would require the Franchise Tax Board to revise the Form 540 to include all of the information necessary for a taxpayer to claim the California EITC.
Existing law, the Earned Income Tax Credit Information Act, requires state departments and agencies that serve those who may qualify for the federal EITC and the California EITC to notify their program recipients that they may be eligible for the federal EITC and the California EITC, as provided. Existing law defines “state departments and agencies that serve those who may qualify for the federal EITC and the California EITC” to mean certain programs in the State Department of Education, the Employment Development Department, and the State Department of Health Care Services.
This bill would expand the definition of “state departments and agencies that serve those who may qualify for the federal EITC and the California EITC” to include the California Work Opportunity and Responsibility to Kids (CalWORKs) program in the State Department of Social Services.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 18573 is added to the Revenue and Taxation Code, to read:

18573.
 The Franchise Tax Board shall revise the Form 540 to include all of the information necessary for a taxpayer to claim the California Earned Income Tax Credit.

SEC. 2.

 Section 19852 of the Revenue and Taxation Code is amended to read:

19852.
 For purposes of this part, the following terms have the following meanings:
(a) “Employer” means any California employer who is subject to, and is required to provide, unemployment insurance to his or her employees, under the Unemployment Insurance Code.
(b) “Employee” means any person who is covered by unemployment insurance by his or her employer, pursuant to the Unemployment Insurance Code.
(c) “Federal EITC” means the federal earned income tax credit, as defined in Section 32 of the Internal Revenue Code.
(d) “California EITC” means the California earned income tax credit, as defined in Section 17052 of the Revenue and Taxation Code.
(e) “State departments and agencies that serve those who may qualify for the federal EITC and the California EITC” means the following programs in the specified departments and agencies:
(1) The State Department of Education: free or reduced-price meal program and National School Lunch Program.
(2) Employment Development Department: California Unemployment Insurance.
(3) State Department of Health Care Services: the Medi-Cal program.
(4) State Department of Social Services: California Work Opportunity and Responsibility to Kids (CalWORKs) program.
(f) The amendments made to this section by the act adding this subdivision Chapter 294 of the Statutes of 2016 shall apply to notices required pursuant to Section 19853 furnished on or after the effective date of that act. January 1, 2017.
(g) The amendments made to this section by the act adding this subdivision shall apply to notices required pursuant to Section 19853 furnished on or after the effective date of that act.