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AB-2892 Income taxes: credits: backup electricity generators.(2021-2022)

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Date Published: 04/18/2022 09:00 PM
AB2892:v97#DOCUMENT

Amended  IN  Assembly  April 18, 2022
Amended  IN  Assembly  April 05, 2022

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Assembly Bill
No. 2892

Introduced by Assembly Member Bigelow

February 18, 2022

An act to add and repeal Sections 17053.48 and 23688 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.


LEGISLATIVE COUNSEL'S DIGEST


AB 2892, as amended, Bigelow. Income taxes: credits: backup electricity generators.
The Personal Income Tax Law and Corporate 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 would allow a credit against those taxes for each taxable year beginning on or after January 1, 2022, and before January 1, 2027, in an amount that is equal to 50% of the amount incurred by a natural person or a small business, as defined, during the taxable year for the purchase, that does not exceed $18,000, of a backup generator for use in a residence or commercial property in a designated wildfire zone, as defined. The bill would also include additional information required 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 17053.48 is added to the Revenue and Taxation Code, to read:

17053.48.
 (a) (1) For each taxable year beginning on or after January 1, 2022, and before January 1, 2027, there shall be allowed as a credit against the “net tax,” as defined in Section 17039, an amount equal to the amount specified in paragraph (2) for a qualified expenditure paid or incurred by the qualified taxpayer during the taxable year.
(2) (A) The amount of the credit allowed pursuant to this section for the taxable year shall be equal to 50 percent of the amount paid or incurred by a qualified taxpayer during the taxable year for a qualified expenditure.
(B) The amount of the credit allowed to a qualified taxpayer shall not exceed nine thousand dollars ($9,000) per taxable year.
(b) For purposes of this section, the following definitions shall apply:
(1) “Designated wildfire zone” means any of the following:
(A) A high or very high fire hazard severity zone, as determined by the Department of Forestry and Fire Protection pursuant to Section 51178 of the Government Code.
(B) A high or very high fire hazard severity zone as indicated on maps adopted by the Department of Forestry and Fire Protection pursuant to Section 4202 of the Public Resources Code.
(C) An area affected by four one or more public safety power shutoffs in the prior taxable year.
(2) “Public safety power shutoff” means the proactive deenergization of electric facilities to mitigate wildfire risk caused by utility infrastructure.
(3) “Qualified taxpayer” means a natural person or a small business that incurs a qualified expenditure.
(4) “Qualified expenditure” means the purchase of a backup electricity generator that does not exceed eighteen thousand dollars ($18,000) for use in a residence or commercial property in a designated wildfire zone.
(5) “Small business” means a business that is all of the following:
(A) Independently owned and operated.
(B) Has fewer than 100 employees.
(C) Has average annual gross receipts of fifteen million dollars ($15,000,000) or less over the previous three years.
(c) 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 four years if necessary, until the credit is exhausted.
(d) This section shall remain in effect only until December 1, 2027, and as of that date is repealed.

SEC. 2.

 Section 23688 is added to the Revenue and Taxation Code, to read:

23688.
 (a) (1) For each taxable year beginning on or after January 1, 2022, and before January 1, 2027, there shall be allowed as a credit against the “tax,” as defined in Section 23036, an amount equal to the amount specified in paragraph (2) for a qualified expenditure paid or incurred by the qualified taxpayer during the taxable year.
(2) (A) The amount of the credit allowed pursuant to this section for the taxable year shall be equal to 50 percent of the amount paid or incurred by a qualified taxpayer during the taxable year for a qualified expenditure.
(B) The amount of the credit allowed to a qualified taxpayer shall not exceed nine thousand dollars ($9,000) per taxable year.
(b) For purposes of this section, the following definitions shall apply:
(1) “Designated wildfire zone” means any of the following:
(A) A high or very high fire hazard severity zone, as determined by the Department of Forestry and Fire Protection pursuant to Section 51178 of the Government Code.
(B) A high or very high fire hazard severity zone as indicated on maps adopted by the Department of Forestry and Fire Protection pursuant to Section 4202 of the Public Resources Code.
(C) An area affected by four one or more public safety power shutoffs in the prior taxable year.
(2) “Public safety power shutoff” means the proactive deenergization of electric facilities to mitigate wildfire risk caused by utility infrastructure.
(3) “Qualified taxpayer” means a small business that incurs a qualified expenditure.
(4) “Qualified expenditure” means the purchase of a backup electricity generator that does not exceed eighteen thousand dollars ($18,000) for use in a residence or commercial property in a designated wildfire zone.
(5) “Small business” means a business that is all of the following:
(A) Independently owned and operated.
(B) Has fewer than 100 employees.
(C) Has average annual gross receipts of fifteen million dollars ($15,000,000) or less over the previous three years.
(c) 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 four years if necessary, until the credit is exhausted.
(d) This section shall remain in effect only until December 1, 2027, and as of that date is repealed.

SEC. 3.

 (a) For the purposes of complying with Section 41 of the Revenue and Taxation Code, the Legislature finds and declares the following:
(1) The goal, purpose, or objective of Sections 17053.48 and 23688 of the Revenue and Taxation Code, as added by this act, hereafter the “credit,” is to encourage the purchase of backup electricity generators that are necessary to protect the health and safety of residents and businesses in designated wildfire zones.
(2) The performance indicator for the Legislature to use when measuring whether the credit meets the goal, purpose, or objective specified in paragraph (1) is how many taxpayers are allowed the credits.
(b) (1) The Franchise Tax Board shall annually publish anonymized data on the credit through the 2027 calendar year.
(2) The reporting requirements of this subdivision shall be treated as an exception to Section 19542 of the Revenue and Taxation Code.

SEC. 4.

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