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AB-81 Income and bank and corporation taxes: deduction: energy conservation.(2001-2002)



Current Version: 08/20/01 - Amended Assembly

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AB81:v98#DOCUMENT

Amended  IN  Assembly  August 20, 2001

CALIFORNIA LEGISLATURE— 2001–2002 2nd Ext.

Assembly Bill
No. 81

Introduced  by  Assembly Member Cogdill
 (Coauthor(s): Assembly Member Dickerson, Oropeza, Pescetti, Wyland)
 (Coauthor(s): Senator Morrow)

July 10, 2001

An act to amend Section 17072 of, and to add Sections 17211 and 24342 to, the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.


LEGISLATIVE COUNSEL'S DIGEST


AB 81, as amended, Cogdill. Income and bank and corporation taxes: deduction: energy conservation.
The Personal Income Tax Law and the Bank and Corporation Tax Law authorize various deductions in computing taxable income.
This bill would, under both laws, allow a taxpayer to elect to take a deduction in an amount equal to 25% of the cost paid or incurred for qualified energy conservation measures, as defined.
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 17072 of the Revenue and Taxation Code is amended to read:

17072.
 (a) Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, shall apply, except as otherwise provided.
(b) The amendments to Section 62 of the Internal Revenue Code, made by Section 13213 of the Revenue Reconciliation Act of 1993 (P.L. 103-66), relating to modifications to deduction for moving expenses, shall apply to taxable years beginning on or after January 1, 1996.
(c) The deduction allowed by Section 17204, relating to interest on education loans, shall be allowed in computing adjusted gross income.
(d) The deduction allowed by Section 17211, relating to energy conservation, shall be allowed in computing adjusted gross income.

Section 17211 is added to the Revenue and Taxation Code, to read:

17211.
 (a) There shall be allowed A taxpayer may elect to take as a deduction an amount equal to 25 percent of the cost paid or incurred by the taxpayer during the taxable year for qualified energy conservation measures installed on, or taken with respect to, any residential dwelling or small commercial building in this state.
(b) For purposes of this section:
(1) “Qualified energy conservation measures” means both of the following:
(A) Energy load reduction systems.
(B) Energy audits for the residential dwelling or small commercial building.
(2) “Energy load reduction systems” means the installation, by a professional installer licensed by the state, of any passive system capable of saving a minimum of 5 percent in the amount of energy for cooling, as determined in accordance with standards and methods established by the California Energy Commission, the residential dwelling or small commercial building, including, but not limited to, the following:
(A) Roofs.
(B) Radiant barriers.
(C) Attic, wall, and floor insulation.
(D) Window shading, including shades, awnings, shadescreens, trellises, and solar control window film.
(E) Duct efficiency improvements, including duct air sealing, duct blaster testing, duct insulation, and duct design and airflow modifications.
(3) “Passive systems” includes only those systems that do not require intervention or augmentation by other systems to adjust or otherwise turn them on or off, and that do not require electricity or hydraulic or other mechanical devices to make them useful or effective.
(4) “Small commercial building” means a building in which less than an average of 50 kilowatt hours per day are used based upon the previous year’s usage, as certified by the utility energy provider that provided the electricity.
(c) The deduction allowed by this section shall not exceed seven hundred fifty dollars ($750) per taxable year in the case of a residential dwelling, and one thousand five hundred dollars ($1,500) in the case of a small commercial building.

(d)The deduction allowed by this section shall be in addition to any other deduction or credit otherwise allowed by this part with respect to qualified conservation measures.

(d) The election to take the deduction under this section shall be made in the form and manner prescribed by the Franchise Tax Board, on the taxpayer’s original return of the tax imposed by this part for the taxable year, and may not be revoked except with the consent of the board. If the taxpayer makes the election, the deduction allowed by this section shall be in lieu of any other deduction or credit otherwise allowed by this part with respect to qualified conservation measures.
Section 24342 is added to the Revenue and Taxation Code, to read:

24342.
 (a) There shall be allowed A taxpayer may elect to take as a deduction an amount equal to 25 percent of the cost paid or incurred by the taxpayer during the taxable year for qualified energy conservation measures installed on, or taken with respect to, any residential dwelling or small commercial building in this state.
(b) For purposes of this section:
(1) “Qualified energy conservation measures” means both of the following:
(A) Energy load reduction systems.
(B) Energy audits for the residential dwelling or small commercial building.
(2) “Energy load reduction systems” means the installation, by a professional installer licensed by the state, of any passive system capable of saving a minimum of 5 percent in the amount of energy for cooling, as determined in accordance with standards and methods established by the California Energy Commission, the residential dwelling or small commercial building, including, but not limited to, the following:
(A) Roofs.
(B) Radiant barriers.
(C) Attic, wall, and floor insulation.
(D) Window shading, including shades, awnings, shadescreens, trellises, and solar control window film.
(E) Duct efficiency improvements, including duct air sealing, duct blaster testing, duct insulation, and duct design and airflow modifications.
(3) “Passive systems” includes only those systems that do not require intervention or augmentation by other systems to adjust or otherwise turn them on or off, and that do not require electricity or hydraulic or other mechanical devices to make them useful or effective.
(4) “Small commercial building” means a building in which less than an average of 50 kilowatt hours per day are used based upon the previous year’s usage, as certified by the utility energy provider that provided the electricity.
(c) The deduction allowed by this section shall not exceed seven hundred fifty dollars ($750) per taxable year in the case of a residential dwelling, and one thousand five hundred dollars ($1,500) in the case of a small commercial building.

(d)The deduction allowed by this section shall be in addition to any other deduction or credit otherwise allowed by this part with respect to qualified conservation measures.

(d) The election to take the deduction under this section shall be made in the form and manner prescribed by the Franchise Tax Board, on the taxpayer’s original return of the tax imposed by this part for the taxable year, and may not be revoked except with the consent of the board. If the taxpayer makes the election, the deduction allowed by this section shall be in lieu of any other deduction or credit otherwise allowed by this part with respect to qualified conservation measures.

SEC. 4.

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