BILL NUMBER: SB 1827	AMENDED
	BILL TEXT

	AMENDED IN SENATE  MAY 2, 2006
	AMENDED IN SENATE  APRIL 17, 2006

INTRODUCED BY   Senator Migden

                        FEBRUARY 24, 2006

   An act  to amend Section 297.5 of the Family Code, and 
to amend Sections 17024.5 and 18521 of the Revenue and Taxation Code,
relating to taxation.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1827, as amended, Migden  Taxation: domestic partners.
   The Personal Income Tax Law imposes tax on taxable income and
provides, among other things, that specified definitions govern the
construction of that law. Existing law allows married couples to file
joint or separate state tax returns, as specified.
   This bill would allow registered domestic partners to file joint
or separate state tax returns, as specified.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


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


   SECTION 1.    Section 297.5 of the   Family
Code   is amended to read: 
   297.5.  (a) Registered domestic partners shall have the same
rights, protections, and benefits, and shall be subject to the same
responsibilities, obligations, and duties under law, whether they
derive from statutes, administrative regulations, court rules,
government policies, common law, or any other provisions or sources
of law, as are granted to and imposed upon spouses.
   (b) Former registered domestic partners shall have the same
rights, protections, and benefits, and shall be subject to the same
responsibilities, obligations, and duties under law, whether they
derive from statutes, administrative regulations, court rules,
government policies, common law, or any other provisions or sources
of law, as are granted to and imposed upon former spouses.
   (c) A surviving registered domestic partner, following the death
of the other partner, shall have the same rights, protections, and
benefits, and shall be subject to the same responsibilities,
obligations, and duties under law, whether they derive from statutes,
administrative regulations, court rules, government policies, common
law, or any other provisions or sources of law, as are granted to
and imposed upon a widow or a widower.
   (d) The rights and obligations of registered domestic partners
with respect to a child of either of them shall be the same as those
of spouses. The rights and obligations of former or surviving
registered domestic partners with respect to a child of either of
them shall be the same as those of former or surviving spouses.
   (e) To the extent that provisions of California law adopt, refer
to, or rely upon, provisions of federal law in a way that otherwise
would cause registered domestic partners to be treated differently
than spouses, registered domestic partners shall be treated by
California law as if federal law recognized a domestic partnership in
the same manner as California law.
   (f) Registered domestic partners shall have the same rights
regarding nondiscrimination as those provided to spouses.  
   (g) Notwithstanding this section, in filing their state income tax
returns, domestic partners shall use the same filing status as is
used on their federal income tax returns, or that would have been
used had they filed federal income tax returns. Earned income may not
be treated as community property for state income tax purposes.
 
   (h) 
    (g)  No public agency in this state may discriminate
against any person or couple on the ground that the person is a
registered domestic partner rather than a spouse or that the couple
are registered domestic partners rather than spouses, except that
nothing in this section applies to modify eligibility for long-term
care plans pursuant to Chapter 15 (commencing with Section 21660) of
Part 3 of Division 5 of Title 2 of the Government Code.  
   (i) 
    (h)  This act does not preclude any state or local
agency from exercising its regulatory authority to implement statutes
providing rights to, or imposing responsibilities upon, domestic
partners.  
   (j) 
    (i)  This section does not amend or modify any provision
of the California Constitution or any provision of any statute that
was adopted by initiative.  
   (k) 
    (j)  This section does not amend or modify federal laws
or the benefits, protections, and responsibilities provided by those
laws.  
   (l) 
    (k)  Where necessary to implement the rights of
registered domestic partners under this act, gender-specific terms
referring to spouses shall be construed to include domestic partners.
  
   (m) 
    (l)  (1) For purposes of the statutes, administrative
regulations, court rules, government policies, common law, and any
other provision or source of law governing the rights, protections,
and benefits, and the responsibilities, obligations, and duties of
registered domestic partners in this state, as effectuated by this
section, with respect to community property, mutual responsibility
for debts to third parties, the right in particular circumstances of
either partner to seek financial support from the other following the
dissolution of the partnership, and other rights and duties as
between the partners concerning ownership of property, any reference
to the date of a marriage shall be deemed to refer to the date of
registration of a domestic partnership with the state.
   (2) Notwithstanding paragraph (1), for domestic partnerships
registered with the state before January 1, 2005, an agreement
between the domestic partners that the partners intend to be governed
by the requirements set forth in Sections 1600 to 1620, inclusive,
and which complies with those sections, except for the agreement's
effective date, shall be enforceable as provided by Sections 1600 to
1620, inclusive, if that agreement was fully executed and in force as
of June 30, 2005.
   SECTION 1.   SEC. 2.   Section 17024.5
of the Revenue and Taxation Code is amended to read:
   17024.5.  (a) (1) Unless otherwise specifically provided, the
terms "Internal Revenue Code," "Internal Revenue Code of 1954," or
"Internal Revenue Code of 1986," for purposes of this part, mean
Title 26 of the United States Code, including all amendments thereto
as enacted on the specified date for the applicable taxable year as
follows:


                                   Specified Date
                                         of
                                      Internal
                                      Revenue
                                        Code
           Taxable Year               Sections
(A) For taxable years
beginning on or
after
January 1, 1983, and on or
before
December
31, 1983....................... January 15, 1983
(B) For taxable years
beginning on or
after
January 1, 1984, and on or
before
December
31, 1984....................... January 1, 1984
(C) For taxable years
beginning on or
after
January 1, 1985, and on or
before
December
31, 1985....................... January 1, 1985
(D) For taxable years
beginning on or
after
January 1, 1986, and on or
before
December
31, 1986....................... January 1, 1986
(E) For taxable years
beginning on or
after
January 1, 1987, and on or
before
December
31, 1988....................... January 1, 1987
(F) For taxable years
beginning on or
after
January 1, 1989, and on or
before
December
31, 1989....................... January 1, 1989
(G) For taxable years
beginning on or
after
January 1, 1990, and on or
before
December
31, 1990....................... January 1, 1990
(H) For taxable years
beginning on or
after
January 1, 1991, and on or
before
December
31, 1991....................... January 1, 1991
(I) For taxable years
beginning on or
after
January 1, 1992, and on or
before
December
31, 1992....................... January 1, 1992
(J) For taxable years
beginning on or
after
January 1, 1993, and on or
before
December
31, 1996....................... January 1, 1993
(K) For taxable years
beginning on or
after
January 1, 1997, and on or
before
December
31, 1997....................... January 1, 1997
(L) For taxable years
beginning on or
after
January 1, 1998, and on or
before
December
31, 2001....................... January 1, 1998
(M) For taxable years
beginning on or
after
January 1, 2002, and on or
before December 31, 2004....... January 1, 2001
(N) For taxable years
beginning on or
after
January 1, 2005................ January 1, 2005

   (2) (A) Unless otherwise specifically provided, for federal laws
enacted on or after January 1, 1987, and on or before the specified
date for the taxable year, uncodified provisions that relate to
provisions of the Internal Revenue Code that are incorporated for
purposes of this part shall be applicable to the same taxable years
as the incorporated provisions.
   (B) In the case where Section 901 of the Economic Growth and Tax
Relief Act of 2001 (Public Law 107-16) applies to any provision of
the Internal Revenue Code that is incorporated for purposes of this
part, Section 901 of the Economic Growth and Tax Relief Act of 2001
shall apply for purposes of this part in the same manner and to the
same taxable years as it applies for federal income tax purposes.
   (3) Subtitle G (Tax Technical Corrections) and Part I of Subtitle
H (Repeal of Expired or Obsolete Provisions) of the Revenue
Reconciliation Act of 1990 (Public Law 101-508) modified numerous
provisions of the Internal Revenue Code and provisions of prior
federal acts, some of which are incorporated by reference into this
part. Unless otherwise provided, the provisions described in the
preceding sentence, to the extent that they modify provisions that
are incorporated into this part, are declaratory of existing law and
shall be applied in the same manner and for the same periods as
specified in the Revenue Reconciliation Act of 1990.
   (b) Unless otherwise specifically provided, when applying any
provision of the Internal Revenue Code for purposes of this part, a
reference to any of the following is not applicable for purposes of
this part:
   (1) Except as provided in Chapter 4.5 (commencing with Section
23800) of Part 11 of Division 2, an electing small business
corporation, as defined in Section 1361(b) of the Internal Revenue
Code.
   (2) Domestic international sales corporations (DISC), as defined
in Section 992(a) of the Internal Revenue Code.
   (3) A personal holding company, as defined in Section 542 of the
Internal Revenue Code.
   (4) A foreign personal holding company, as defined in Section 552
of the Internal Revenue Code.
   (5) A foreign investment company, as defined in Section 1246(b) of
the Internal Revenue Code.
   (6) A foreign trust, as defined in Section 679 of the Internal
Revenue Code.
   (7) Foreign income taxes and foreign income tax credits.
   (8) Section 911 of the Internal Revenue Code, relating to United
States citizens living abroad.
   (9) A foreign corporation, except that Section 367 of the Internal
Revenue Code shall be applicable.
   (10) Federal tax credits and carryovers of federal tax credits.
   (11) Nonresident aliens.
   (12) Deduction for personal exemptions, as provided in Section 151
of the Internal Revenue Code.
   (13) The tax on generation-skipping transfers imposed by Section
2601 of the Internal Revenue Code.
   (14) The tax, relating to estates, imposed by Section 2001 or 2101
of the Internal Revenue Code.
   (c) (1) The provisions contained in Sections 41 to 44, inclusive,
and Section 172 of the Tax Reform Act of 1984 (Public Law 98-369),
relating to treatment of debt instruments, is not applicable for
taxable years beginning before January 1, 1987.
   (2) The provisions contained in Public Law 99-121, relating to the
treatment of debt instruments, is not applicable for taxable years
beginning before January 1, 1987.
   (3) For each taxable year beginning on or after January 1, 1987,
the provisions referred to by paragraphs (1) and (2) shall be
applicable for purposes of this part in the same manner and with
respect to the same obligations as the federal provisions, except as
otherwise provided in this part.
   (d) When applying the Internal Revenue Code for purposes of this
part, regulations promulgated in final form or issued as temporary
regulations by "the secretary" shall be applicable as regulations
under this part to the extent that they do not conflict with this
part or with regulations issued by the Franchise Tax Board.
   (e) Whenever this part allows a taxpayer to make an election, the
following rules shall apply:
   (1) A proper election filed with the Internal Revenue Service in
accordance with the Internal Revenue Code or regulations issued by
"the secretary" shall be deemed to be a proper election for purposes
of this part, unless otherwise provided in this part or in
regulations issued by the Franchise Tax Board.
   (2) A copy of that election shall be furnished to the Franchise
Tax Board upon request.
   (3) (A) Except as provided in subparagraph (B), in order to obtain
treatment other than that elected for federal purposes, a separate
election shall be filed at the time and in the manner required by the
Franchise Tax Board.
   (B) (i) If a taxpayer makes a proper election for federal income
tax purposes prior to the time that taxpayer becomes subject to the
tax imposed under this part or Part 11 (commencing with Section
23001), that taxpayer is deemed to have made the same election for
purposes of the tax imposed by this part, Part 10.2 (commencing with
Section 18401), and Part 11 (commencing with Section 23001), as
applicable, and that taxpayer may not make a separate election for
California tax purposes unless that separate election is expressly
authorized by this part, Part 10.2 (commencing with Section 18401),
or Part 11 (commencing with Section 23001), or by regulations issued
by the Franchise Tax Board.
   (ii) If a taxpayer has not made a proper election for federal
income tax purposes prior to the time that taxpayer becomes subject
to tax under this part or Part 11 (commencing with Section 23001),
that taxpayer may not make a separate California election for
purposes of this part, Part 10.2 (commencing with Section 18401), or
Part 11 (commencing with Section 23001), unless that separate
election is expressly authorized by this part, Part 10.2 (commencing
with Section 18401), or Part 11 (commencing with Section 23001), or
by regulations issued by the Franchise Tax Board.
   (iii) This subparagraph applies only to the extent that the
provisions of the Internal Revenue Code or the regulation issued by
"the secretary" authorizing an election for federal income tax
purposes apply for purposes of this part, Part 10.2 (commencing with
Section 18401) or Part 11 (commencing with Section 23001).
   (f) Whenever this part allows or requires a taxpayer to file an
application or seek consent, the rules set forth in subdivision (e)
shall be applicable with respect to that application or consent.
   (g) When applying the Internal Revenue Code for purposes of
determining the statute of limitations under this part, any reference
to a period of three years shall be modified to read four years for
purposes of this part.
   (h) When applying, for purposes of this part, any section of the
Internal Revenue Code or any applicable regulation thereunder, all of
the following shall apply:
   (1) References to "adjusted gross income" shall mean the amount
computed in accordance with Section 17072, except as provided in
paragraph (2).
   (2) (A) Except as provided in subparagraph (B), references to
"adjusted gross income" for purposes of computing limitations based
upon adjusted gross income, shall mean the amount required to be
shown as adjusted gross income on the federal tax return for the same
taxable year.
   (B) In the case of registered domestic partners filing a joint
return under Section 18521, adjusted gross income for the purposes of
computing limitations based upon adjusted gross income, shall mean
the total of the amount required to be shown as adjusted gross income
on the federal tax return for the same taxable year of each
registered domestic partner.
   (3) Any reference to "subtitle" or "chapter" shall mean this part.

   (4) The provisions of Section 7806 of the Internal Revenue Code,
relating to construction of title, shall apply.
   (5) Any provision of the Internal Revenue Code that becomes
operative on or after the specified date for that taxable year shall
become operative on the same date for purposes of this part.
   (6) Any provision of the Internal Revenue Code that becomes
inoperative on or after the specified date for that taxable year
shall become inoperative on the same date for purposes of this part.

   (7) Due account shall be made for differences in federal and state
terminology, effective dates, substitution of "Franchise Tax Board"
for "secretary" when appropriate, and other obvious differences.
   (i) Any reference to a specific provision of the Internal Revenue
Code shall include modifications of that provision, if any, in this
part.
   SEC. 2.   SEC. 3.   Section 18521 of the
Revenue and Taxation Code is amended to read:
   18521.  (a) (1) Except as otherwise provided in this section, an
individual shall use the same filing status that he or she used on
his or her federal income tax return filed for the same taxable year.

   (2) If the Franchise Tax Board determines that the filing status
used on the taxpayer's federal income tax return was incorrect, the
Franchise Tax Board may, under Section 19033 (relating to deficiency
assessments), revise the return to reflect a correct filing status.
   (3) If either spouse was a nonresident for any portion of the
taxable year, a husband and wife who file a joint federal income tax
return shall be required to file a joint nonresident return.
   (b) In the case of an individual who is not required to file a
federal income tax return for the taxable year, that individual may
use any filing status on the return required under this part that he
or she would be eligible to use on a federal income tax return for
the same taxable year if a federal income tax return was required.
   (c) Notwithstanding subdivision (a), a husband and wife  and
registered domestic partners, as described in Section 297 of the
Family Code, who are registered as domestic partners as of the close
of the taxable year,  may file separate returns under this part
if either spouse  or registered domestic partner  was either
of the following during the taxable year:
   (1) An active member of the Armed Forces or any auxiliary branch
thereof.
   (2) A nonresident for the entire taxable year who had no income
from a California source.
   (d) Notwithstanding subdivision (a), registered domestic partners,
as described in Section 297 of the Family Code, who are registered
as domestic partners as of the close of the taxable year, 
may   shall  either file a joint return or file
separately by applying the standards applicable to married couples
under federal income tax law.  A separate return filed by a domestic
partner of a registered domestic partnership shall be subject to the
same conditions and limitations applicable to the separate return of
a married individual.
   (e) Except for taxpayers described in subdivision (c)  or
(d)  , for any taxable year with respect to which a joint
return has been filed, a separate return shall not be made by either
spouse or domestic partner after the period for either to file a
separate return has expired.
   (f) No joint return shall be made if the husband and wife or the
domestic partners have different taxable years; except that if their
taxable years begin on the same day and end on different days because
of the death of either or both, then a joint return may be made with
respect to the taxable year of each. The above exception shall not
apply if the surviving spouse remarries or the surviving domestic
partner enters into a new domestic partnership before the close of
his or her taxable year, or if the taxable year of either spouse or
domestic partner is a fractional part of a year under Section 443(a)
of the Internal Revenue Code.
   (g) In the case of the death of one spouse or domestic partner or
both spouses or both domestic partners the joint return with respect
to the decedent may be made only by the decedent's executor or
administrator; except that, in the case of the death of one spouse or
domestic partner, the joint return may be made by the surviving
spouse or surviving domestic partner with respect to both that spouse
or domestic partner and the decedent if no return for the taxable
year has been made by the decedent, no executor or administrator has
been appointed, and no executor or administrator is appointed before
the last day prescribed by law for filing the return of the surviving
spouse or surviving domestic partner. If an executor or
administrator of the decedent is appointed after the making of the
joint return by the surviving spouse or surviving domestic partner,
the executor or administrator may disaffirm the joint return by
making, within one year after the last day prescribed by law for
filing the return of the surviving spouse or surviving domestic
partner, a separate return for the taxable year of the decedent with
respect to which the joint return was made, in which case the return
made by the survivor shall constitute his or her separate return.