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AB-2727 Personal income taxes: credit: firefighters.(2017-2018)

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Date Published: 04/10/2018 09:00 PM
AB2727:v98#DOCUMENT

Amended  IN  Assembly  April 10, 2018

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Assembly Bill No. 2727


Introduced by Assembly Member Flora

February 15, 2018


An act to add and repeal Section 17053.55 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.


LEGISLATIVE COUNSEL'S DIGEST


AB 2727, as amended, Flora. Personal income taxes: credit: volunteer firefighters.
The Personal Income Tax Law authorizes various credits against the taxes imposed by that law.
This bill would authorize a credit against that tax for each taxable year beginning on and after January 1, 2019, and before January 1, 2028, 2024, in an amount equal to 35% or 80% of the amount paid or incurred by a qualified firefighter during the taxable year for qualified firefighter expenses, as defined, not to exceed $1,500. and would limit the amount of the credit allowed to a taxpayer for each taxable year to $1,500.
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 17053.55 is added to the Revenue and Taxation Code, to read:

17053.55.
 (a) (1) For each taxable year beginning on or after January 1, 2019, and before January 1, 2028, 2024, there shall be allowed as a credit against the “net tax,” as defined in Section 17039, of a qualified firefighter an amount equal to 35 or 80 percent, not to exceed one thousand five hundred dollars ($1,500), percent of the amount paid or incurred during the taxable year for qualified firefighter expenses. expenses. The amount of a credit allowed under this section to a taxpayer shall not exceed one thousand five hundred dollars ($1,500) for each taxable year.
(2) For purposes of paragraph (1), the applicable credit percentage shall be:
(A) Thirty–five percent of the amount paid or incurred during the taxable year for qualified firefighter expenses by a qualified firefighter described in subparagraph (B) of paragraph (3) of subdivision (b).
(B) Eighty percent of the amount paid or incurred during the taxable year for qualified firefighter expenses by a qualified firefighter described in subparagraph (A) of paragraph (3) of subdivision (b).
(b) For purposes of this section, all of the following apply:
(1) “Certifying entity” means any fire department, as specified in this section, the Department of Forestry and Fire Protection, and any county forestry or firefighting department or unit, to which the qualified firefighter reports.
(2) “Qualified firefighter expenses” means the amount paid or incurred by a qualified firefighter, for which the qualified firefighter was not reimbursed, for training and equipment that was obtained in order to serve as a qualified firefighter.
(3) “Qualified firefighter” means either of the following:
(A) A volunteer firefighter who is registered as an active firefighting member of any regularly organized volunteer fire department having official recognition, and full or partial support of the government of the county, city, town, or district in the this state in which the volunteer fire department is located.
(B) A professional firefighter who is employed as a firefighter by the Department of Forestry and Fire Protection, or any county forestry or firefighting department or unit in this state, or any firefighter hired to serve as a firefighter by a fire department of a city, county, city and county, district, or other public or municipal corporation or political subdivision of this state.
(c) In order to be eligible for a tax credit authorized by this section, the qualified firefighter shall do all of the following:
(1) Submit a request to the certifying entity for certification of both of the following:
(A) That the firefighter is a qualified firefighter as provided by this section.
(B) That the equipment for which the qualified firefighter is claiming a credit under this section was obtained in order to serve as a qualified firefighter.
(2) Retain for his or her records a copy of the certificate issued by the certifying entity as specified in subdivision (d).
(3) Provide a copy of the certification to the Franchise Tax Board upon request. If the qualified firefighter fails to comply with the requirements of this subdivision, no credit shall be allowed to that qualified firefighter under this section for any taxable year unless the qualified firefighter subsequently complies.
(d) The certifying entity shall do all of the following:
(1) Certify that the firefighter is a qualified firefighter as provided by this section.
(2) Certify that the equipment for which the qualified firefighter is claiming a credit under this section was obtained in order to serve as a qualified firefighter.
(3) Provide the qualified firefighter with a copy of the certification to retain for his or her records.
(e) No deduction shall be allowed as otherwise provided in this part for that portion of expenses paid or incurred for the taxable year which is equal to the amount of the credit allowed under this section attributable to those expenses.
(f) No credit may be claimed under this section with respect to any amount for which any other credit has been claimed under this part.
(g) If a qualified firefighter that claims a credit under this section sells, transfers, or otherwise disposes of, either directly or indirectly, any equipment within three years of the taxable year during which he or she first claimed the credit, there shall be added to the “net tax” of the qualified firefighter for the taxable year of sale, transfer, or disposition an amount equal to the total credit claimed multiplied by a fraction, the numerator of which is the remaining term of the three years and the denominator of which is three.
(h) 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” for the next three taxable years, or until the credit has been exhausted, whichever occurs first.
(i) This section shall remain in effect only until December 1, 2028, 2024, and as of that date is repealed.

SEC. 2.

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