BILL NUMBER: AB 110	CHAPTERED  10/02/01

	CHAPTER  410
	FILED WITH SECRETARY OF STATE  OCTOBER 2, 2001
	APPROVED BY GOVERNOR  OCTOBER 1, 2001
	PASSED THE ASSEMBLY  AUGUST 30, 2001
	PASSED THE SENATE  AUGUST 27, 2001
	AMENDED IN SENATE  AUGUST 20, 2001
	AMENDED IN ASSEMBLY  MAY 21, 2001
	AMENDED IN ASSEMBLY  MAY 2, 2001

INTRODUCED BY   Assembly Member Zettel
   (Coauthor:  Assembly Member Jackson)

                        JANUARY 18, 2001

   An act to add Section 19164.1 to the Revenue and Taxation Code,
relating to taxation.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 110, Zettel.  Personal income taxes:  credit:  credentialed
teachers.
   The Personal Income Tax Law authorizes various credits against the
taxes imposed by those laws, including a credit against taxes
imposed by those laws for credentialed teachers in an amount equal to
specified amounts, depending upon years of service as a teacher.
   Existing law requires the Franchise Tax Board to impose an
accuracy-related penalty equal to 20% of the amount of tax
underpayed, if the underpayment is attributable to negligence or
results from a substantial understatement or undervaluation of
specified categories of income subject to tax.
   This bill would provide that the accuracy-related penalty does not
apply to tax credits authorized for credentialed teachers claimed on
tax returns filed for taxable years beginning on or after January 1,
2000, and before January 1, 2001.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 19164.1 is added to the Revenue and Taxation
Code, to read:
   19164.1.  (a) Any understatement determined pursuant to
subdivision (a) of Section 19164 (relating to the accuracy-related
penalty) may not include amounts that are attributable to the credit
allowed under Section 17052.2 (relating to the teacher retention tax
credit).
   (b) This section applies only to tax credits claimed under Section
17052.2 for taxable years beginning on or after January 1, 2000, and
before January 1, 2001.
  SEC. 2.  This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.