BILL NUMBER: AB 1073	CHAPTERED  08/23/04

	CHAPTER  261
	FILED WITH SECRETARY OF STATE  AUGUST 23, 2004
	APPROVED BY GOVERNOR  AUGUST 23, 2004
	PASSED THE SENATE  AUGUST 10, 2004
	PASSED THE ASSEMBLY  JANUARY 29, 2004
	AMENDED IN ASSEMBLY  JANUARY 22, 2004
	AMENDED IN ASSEMBLY  JANUARY 6, 2004
	AMENDED IN ASSEMBLY  JANUARY 5, 2004
	AMENDED IN ASSEMBLY  MAY 6, 2003
	AMENDED IN ASSEMBLY  APRIL 21, 2003

INTRODUCED BY   Assembly Members Dutton, Chavez, La Suer, and Parra
   (Principal coauthor:  Assembly Member Maze)
   (Coauthors:  Assembly Members Aghazarian, Bates, Bogh, Campbell,
Cogdill, Cox, Daucher, Harman, Houston, Leslie, Maddox, Mountjoy,
Mullin, Plescia, Runner, Strickland, and Wyland)

                        FEBRUARY 20, 2003

   An act to add Section 17136.5 to the Revenue and Taxation Code,
relating to taxation, to take effect immediately, tax levy.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1073, Dutton.  Personal income tax:  exemption:  military death
gratuity.
   The Personal Income Tax Law imposes a tax on individual taxpayers
measured by the amount of the taxpayer's taxable income for the
taxable year, but excludes certain items of income from the
computation of tax.
   The Personal Income Tax Law generally conforms with the provisions
of the federal income tax law, except as otherwise specified.
Existing federal law excludes from the computation of taxable income
the entire amount of death gratuity income received by the living
survivor of military personnel for the taxable year in which the
death gratuity is received.
   This bill would, in conformance with the Military Family Tax
Relief Act of 2003, exclude the entire amount of the death gratuity
income received by living survivors of military personnel who lost
their lives on or after September 11, 2001.  This bill would provide
that the retroactive application of the provisions of this bill
serves a public service, and is necessary to provide equitable
treatment to California survivors of military personnel who lost
their lives in defense of their country.
   This bill would take effect immediately as a tax levy.


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


  SECTION 1.  Section 17136.5 is added to the Revenue and Taxation
Code, to read:
   17136.5.  The provisions of Section 134(b)(3) of the Internal
Revenue Code, relating to military benefits, as amended by Section
102 of the Military Family Tax Relief Act of 2003 (Public Law
108-121), shall apply with respect to deaths occurring on or after
September 11, 2001.
  SEC. 2.  The Legislature finds and declares that the application of
this act to deaths that occurred on or after September 11, 2001,
serves a public purpose and is necessary to provide equitable
treatment to California survivors of military personnel who lost
their lives in defense of their country.
  SEC. 3.  This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.