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AB-2191 California Earned Income Tax Credit Outreach, Education, and Free Tax Assistance Grant Program.(2023-2024)



Current Version: 03/18/24 - Amended Assembly

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AB2191:v98#DOCUMENT

Revised  April 09, 2024
Amended  IN  Assembly  March 18, 2024

CALIFORNIA LEGISLATURE— 2023–2024 REGULAR SESSION

Assembly Bill
No. 2191

Introduced by Assembly Member Santiago
(Coauthor: Assembly Member Quirk-Silva)
(Coauthor: Senator Dodd)

February 07, 2024

An act to amend Section 3353 of the Revenue and Taxation Code, relating to property taxes. An act to add Part 10.3.5 (commencing with Section 19859) to Division 2 of the Revenue and Taxation Code, relating to taxation.


LEGISLATIVE COUNSEL'S DIGEST


AB 2191, as amended, Santiago. Property taxes. California Earned Income Tax Credit Outreach, Education, and Free Tax Assistance Grant Program.
The Personal Income Tax Law authorizes various credits against the taxes imposed by that law, including the California Earned Income Tax Credit (CalEITC), the Young Child Tax Credit (YCTC), and the Foster Youth Tax Credit (FYTC). Beginning on or after January 1, 2020, CalEITC is available to any eligible individuals using an individual taxpayer identification number (ITIN). Existing federal income tax law authorizes a refundable earned income tax credit (federal EITC) for certain low-income individuals who have earned income and meet certain other requirements.
This bill would enact the Free Tax Prep and Community Engagement Act, which would establish the California Earned Income Tax Credit (CalEITC) Outreach, Education, and Free Tax Assistance Grant Program. Upon appropriation by the Legislature, the bill would require the Franchise Tax Board to allocate grants to qualified nonprofit community-based organizations or local government agencies to increase the number of eligible households claiming the state and federal Earned Income Tax Credit, the federal Child Tax Credit, the Young Child Tax Credit, and the Foster Youth Tax Credit, and to increase awareness of ITIN tax status eligibility. The bill would authorize the Franchise Tax Board to administratively partner with the Department of Community Services and Development to administer the program. The bill would establish the California Earned Income Tax Credit (CalEITC) Outreach, Education, and Free Tax Assistance Grant Fund in the State Treasury for these purposes.

Existing law requires that notice of impending property tax default be published according to specified procedures.

This bill would make nonsubstantive changes to this provision.

Vote: MAJORITY   Appropriation: NO   Fiscal Committee: NOYES   Local Program: NO  

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


SECTION 1.

 This measure shall be known, and may be cited, as the Free Tax Prep and Community Engagement Act.

SEC. 2.

 The Legislature finds and declares all of the following:
(a) Research shows that the California Earned Income Tax Credit (CalEITC) can improve child and paternal health and spur local economic growth. Children in families that receive the CalEITC have better outcomes in both the short and long term.
(b) Individual Taxpayer Identification Number (ITIN) holders are ineligible for the majority of federal tax benefits, but California made the decision to end the exclusion of ITIN filers for credits, like the CalEITC and the Young Child Tax Credit (YCTC) in 2021.
(c) With more Californians now eligible for tax credits, it is critical that trusted community partners are funded to provide linguistically and culturally competent outreach, education, and free tax filing services.
(d) California must consistently invest in a robust infrastructure of free tax assistance and a growing network of Certified Acceptance Agents who are culturally and linguistically competent to help process ITIN applications so that all Californians are able to leverage the full power and potential of available credits.
(e) The CalEITC is one of California’s best tools to help alleviate poverty, stimulate local economies and businesses, and act as a fronting defense against the deepest risks of economic downturn.
(f) The CalEITC and the YCTC are key to tackling California’s poverty crisis as one in three Californians struggle to meet basic needs, according to United Ways of California’s Real Cost Measure report. An estimated 3,700,000 households in California have an income that falls below the Real Cost Measure, and 97 percent of those households have at least one working adult.
(g) The Foster Youth Tax Credit was established in 2022 to decrease poverty and increase the long-term financial health of current and former foster youth in California by increasing their annual income and incentivizing annual tax filing.

SEC. 3.

 Part 10.3.5 (commencing with Section 19859) is added to Division 2 of the Revenue and Taxation Code, to read:

PART 10.3.5. California Earned Income Tax Credit Outreach, Education, and Free Tax Assistance Grant Program

19859.
 This part shall be known and may be cited as the California Earned Income Tax Credit (CalEITC) Outreach, Education, and Free Tax Assistance Grant Program.

19859.1.
 (a) The Franchise Tax Board shall administer the CalEITC Outreach, Education, and Free Tax Assistance Grant Program in accordance with this part.
(b) The Franchise Tax Board may contract or administratively partner with the Department of Community Services and Development to administer any provisions of this part as the Franchise Tax Board deems necessary.
(c) The Franchise Tax Board may adopt regulations necessary and appropriate to carry out the purposes of this part in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.

19859.2.
 (a) Upon appropriation by the Legislature, the Franchise Tax Board shall allocate 12-month grants to qualified nonprofit community-based organizations or local government agencies to increase the number of eligible households claiming the state and federal Earned Income Tax Credit, the federal Child Tax Credit, the Young Child Tax Credit, and the Foster Youth Tax Credit, and to increase awareness of ITIN tax status eligibility, pursuant to the requirements in this section.
(b) The Franchise Tax Board shall prioritize funding for the following purposes:
(1) Provide timely distribution of funds for education and outreach for the state and federal Earned Income Tax Credit, the federal Child Tax Credit, the Young Child Tax Credit, and the Foster Youth Tax Credit, and for awareness of ITIN eligibility.
(2) To recipients of the 2021 CalEITC+ Education and Outreach Grant administered by the Franchise Tax Board pursuant to the Budget Act of 2021​.
(3) To organizations with prior experience with the Volunteer Income Tax Assistance (VITA) program to provide free tax preparation assistance and ITIN application assistance.
(4) Focus funding in regions of the state with low participation in the CalEITC relative to the estimated eligible population in that area.
(5) Focus funding in regions of the state with estimated high percentages of ITIN filers and ITIN eligible workers who do not have a current ITIN status.
(6) Emphasize collaboration of grantees with other community-based organizations and local government agencies.
(7) Encourage targeting of specific underserved communities, particularly those that experience barriers to taking advantage of the credit, with a focus on extremely low income households, likely ITIN eligible workers, populations with limited English proficiency, rural communities, current and former foster youth, and other hard-to-reach populations.
(c) Grant contracts allocated under this part shall be effective for 12 months to ensure continuity of services.
(d) (1) Beginning March 1, 2027, and annually thereafter, the Franchise Tax Board shall submit a report to the Legislature annually, pursuant to Section 9795 of the Government Code, on the effectiveness of the program.
(2) The Franchise Tax Board, in consultation with the Department of Community Services and Development and with grantees, shall develop metrics to analyze the effectiveness of the program.

19859.3.
 (a) There is hereby established in the State Treasury the California Earned Income Tax Credit (CalEITC) Outreach, Education, and Free Tax Assistance Grant Fund.
(b) The Franchise Tax Board shall use moneys in the fund, upon appropriation by the Legislature, to allocate grants to qualified nonprofit community-based organizations or local government agencies pursuant to Section 19859.2.

SECTION 1.Section 3353 of the Revenue and Taxation Code is amended to read:
3353.

Publication shall be made pursuant to Section 6063 of the Government Code in the county. If no newspaper of general circulation is published in the county, then the publication shall be made by posting in three public places in the county. The cost of publication shall be not more than the rate fixed by the board of supervisors for other county advertising.

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REVISIONS:
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