BILL NUMBER: AB 1848	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Ma

                        JANUARY 28, 2008

   An act to amend Section 18661 of, and to add Section 18664 to, the
Revenue and Taxation Code, relating to taxation.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1848, as introduced, Ma. Income tax: returns: withholding
   (1) The Franchise Tax Board administers the taxes imposed under
the Personal Income Tax Law and the Corporation Tax Law. Existing law
authorizes persons that are required to withhold taxes from
recipients of income to require the recipients of the income to
provide that person with the recipient's name and address.
   This bill would require the recipient of income to also provide
the person paying the income with the payee's social security number
or other taxpayer identification number if requested by the person
paying the income.
   (2) Existing law provides that the Franchise Tax Board, may, by
regulation, require any person to withhold an amount, determined by
the Franchise Tax Board to reasonably represent the amount of tax
due, as specified, and to transmit the amount withheld to the
Franchise Tax Board at a designated time.
   This bill, in modified conformity with the federal income tax law,
would require backup withholding, as provided, at a rate of 7% on
specified payments made on or after January 1, 2009, whenever such
payments are subject to federal backup withholding.
   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 18661 of the Revenue and Taxation Code is
amended to read:
   18661.  When necessary to make effective the provisions of this
article or Article 4 (commencing with Section 18631), the name
 and address   , address, social security number
or other taxpayer identification number  of the recipient of
income shall be furnished upon demand of the person paying the
income.
  SEC. 2.  Section 18664 is added to the Revenue and Taxation Code,
to read:
   18664.  (a) (1) Section 3406 of the Internal Revenue Code,
relating to the backup withholding, shall apply, except as otherwise
provided.
   (2) For purposes of this section, the term "reportable payment,"
as defined in Section 3406(b) of the Internal Revenue Code, shall
include only payments of items of income as defined in Section 18662
and any regulations thereunder.
   (b) The amount of tax to be withheld shall be computed by applying
a rate of 7 percent.
   (c) Where withholding under both this section and other provisions
of this article would otherwise be required, withholding shall only
be required under this section.
   (d) Any payer required to withhold tax pursuant to this section
shall notify the payee of such withholding at a time and in a manner
as may be prescribed in forms and instructions by the Franchise Tax
Board.
   (e) This section shall apply to payments made on or after January
1, 2009.