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AB-834 Income tax credits: leased or rented property: persons receiving housing services or assistance.(2021-2022)

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Date Published: 02/17/2021 09:00 PM
AB834:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Assembly Bill
No. 834


Introduced by Assembly Member Choi

February 17, 2021


An act to add and repeal Sections 17053.81 and 23681 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.


LEGISLATIVE COUNSEL'S DIGEST


AB 834, as introduced, Choi. Income tax credits: leased or rented property: persons receiving housing services or assistance.
The Personal Income Tax Law and the Corporation Tax Law allow various credits against the taxes imposed by those laws. Existing law requires any bill authorizing a new tax expenditure to contain, among other things, specific goals, purposes, and objectives the tax expenditure will achieve, detailed performance indicators, and data collection requirements.
This bill, under both laws, for taxable years beginning on or after January 1, 2021, and before January 1, 2026, would allow a credit against those taxes to a taxpayer that owns a unit rented to, or leased by, persons receiving housing services or assistance, as specified, at below market rates, in an amount equal to $500 for each qualified property owned by the taxpayer, not to exceed $5,000 per taxable year. The bill would also provide findings to comply with the additional information requirement for any bill authorizing a new tax expenditure.
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 17053.81 is added to the Revenue and Taxation Code, to read:

17053.81.
 (a) For each taxable year beginning on or after January 1, 2021, and before January 1, 2026, there shall be allowed a credit against the “net tax,” as defined in Section 17039, to a taxpayer that owns qualified property, in an amount equal to five hundred dollars ($500) for each qualified property owned by the taxpayer, not to exceed five thousand dollars ($5,000) per taxable year.
(b) For purposes of this section, both of the following shall apply:
(1) “Qualified property” means a unit rented to, or leased by, qualified persons at below market rates.
(2) “Qualified persons” means persons receiving housing services or assistance from a nonprofit organization.
(c) A taxpayer that owns a proportional share of the qualified property may claim the credit allowed by this section based upon the taxpayer’s ownership share of the property.
(d) In the case where the credit allowed by this section exceeds the “net tax,” the excess may be carried over to reduce the “net tax” in the following taxable year, and succeeding years if necessary, until the credit is exhausted.
(e) (1) For purposes of complying with Section 41, with respect to this section and Section 23681, the Legislature finds and declares that the goal of the credits is to reduce homelessness by providing a tax incentive to property owners that rent or lease property at below market rates to persons receiving housing services or assistance from a nonprofit organization.
(2) The effectiveness of the credits shall be measured by the number of taxpayers claiming the credit.
(3) The Franchise Tax Board, notwithstanding Section 19542, shall provide the number of taxpayers claiming the credit in this section and in Section 23681 to the Legislature in an annual report, submitted pursuant to Section 9795 of the Government Code.
(f) This section shall remain in effect only until December 1, 2026, and as of that date is repealed.

SEC. 2.

 Section 23681 is added to the Revenue and Taxation Code, to read:

23681.
 (a) For each taxable year beginning on or after January 1, 2021, and before January 1, 2026, there shall be allowed a credit against the “tax,” as defined in Section 23036, to a taxpayer that owns qualified property, in an amount equal to five hundred dollars ($500) for each qualified property owned by the taxpayer, not to exceed five thousand dollars ($5,000) per taxable year.
(b) For purposes of this section, both of the following shall apply:
(1) “Qualified property” means a unit rented to, or leased by, qualified persons at below market rates.
(2) “Qualified persons” means persons receiving housing services or assistance from a nonprofit organization.
(c) A taxpayer that owns a proportional share of the qualified property may claim the credit allowed by this section based upon the taxpayer’s ownership share of the property.
(d) In the case where the credit allowed by this section exceeds the “tax,” the excess may be carried over to reduce the “net tax” in the following taxable year, and succeeding years if necessary, until the credit is exhausted.
(e) This section shall remain in effect only until December 1, 2026, and as of that date is repealed.

SEC. 3.

  This act provides for a tax levy within the meaning of Article IV of the California Constitution and shall go into immediate effect.