BILL ANALYSIS                                                                                                                                                                                                    

                                                                AB 278
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        Date of Hearing:  May 11, 2009

                             Charles M. Calderon, Chair

            AB 278 (Charles Calderon) - As Introduced:  February 12, 2009

        Majority vote

         SUBJECT  :  Franchise and income tax law:  informational returns.

         SUMMARY  :  Deletes an erroneous reference in Revenue and Taxation  
        Code (R&TC) Section 18639 to non-existing Title 15 of the Internal  
        Revenue Code (IRC).

         EXISTING LAW:

         1)Requires certain taxpayers to submit information returns to the  
          Franchise Tax Board (FTB), at the time and in the form and manner  
          prescribed by the FTB. 

        2)Provides that every person who receives payments of interest as a  
          nominee and who makes payments aggregating $10 or more during any  
          calendar year to any other person must file an information return,  
          as prescribed.  

        3)Limits the application of those provisions to tax-exempt interest.

        4)Exempts from those filing requirements a trust that is exempt from  
          federal tax under Section 664(c) of Title 15 of the IRC. 

         FISCAL EFFECT  :  None

         COMMENTS  :   

        1)This bill is a "code maintenance" bill that makes a technical,  
          non-substantive change to the provisions of R&TC Section 18639 by  
          deleting the erroneous reference to Title 15 of the IRC. 

        2)IRC Section 664, which deals with charitable remainder trusts, is  
          included in Subpart C of Part I of Subchapter J of Chapter 1 of  
          Subtitle A of Title 26 of the United States Code.  Neither the IRC  
          nor Section 664 contains a reference to Title 15.  



                                                                AB 278
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        None on file
        None on file
        Analysis Prepared by  :   Oksana Jaffe / REV. & TAX. / (916) 319-2098