BILL NUMBER: SB 358	AMENDED
	BILL TEXT

	AMENDED IN SENATE  MAY 23, 2011
	AMENDED IN SENATE  APRIL 26, 2011

INTRODUCED BY   Senator Cannella
   (Coauthors: Senators Fuller and Rubio)
   (Coauthor: Assembly Member Olsen)

                        FEBRUARY 15, 2011

   An act to add Sections 17158  and 24316   ,
18036.1, 24316, and 24916.1 to the Revenue and Taxation Code,
relating to taxation, to take effect immediately, tax levy.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 358, as amended, Cannella. Income tax: gross income: exclusion:
 depreciation deduction:  air quality funds.
   The Personal Income Tax Law and the Corporation Tax Law define
gross income as all income from whatever source derived, unless
specifically excluded.
   This bill would exclude from gross income any amount provided to a
person by the State Air Resources Board, an air pollution control
district, or an air quality management district for the purpose of
air pollution reduction. 
   The Personal Income Tax Law and the Corporation Tax Law, in
modified conformity with federal income tax laws, determine the basis
for property when determining a gain or loss on the sale or other
disposition of that property or when determining a depreciation
deduction relating to that property.  
   This bill would provide, under both laws, that for purposes of
determining the gain or loss from the sale or other deposition of the
property or when determining the depreciation deduction, the basis
of the property shall be reduced to the extent the property was
acquired with a grant amount by the State Air Resources Board, an air
pollution control district, or an air quality management district
for the purpose of air pollution reduction. 
   This bill would take effect immediately as a tax levy.
   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 17158 is added to the Revenue and Taxation
Code, to read:
   17158.  Gross income shall not include any amount provided by the
State Air Resources Board, an air pollution control district, or an
air quality management district to any person for the purpose of air
pollution reduction.
   SEC. 2.    Section 18036.1 is added to the  
Revenue and Taxation Code   , to read:  
   18036.1.  Notwithstanding any other provision to the contrary, for
purposes of this part, the basis of property for determining gain or
loss on the sale or other disposition of property, or for
determining depreciation, shall be reduced to the extent the property
was acquired with a grant or other amount that was provided to a
person by the State Air Resources Board, an air pollution control
district, or an air quality management district for the purpose of
air pollution reduction. 
   SEC. 2.   SEC. 3.   Section 24316 is
added to the Revenue and Taxation Code, to read:
   24316.  Gross income shall not include any amount provided by the
State Air Resources Board, air pollution control districts, and air
quality management districts to any person for the purpose of air
pollution reduction.
   SEC. 4.    Section 24916.1 is added to the  
Revenue and Taxation Code   , to read:  
   24916.1.  Notwithstanding any other provision to the contrary, for
purposes of this part, the basis of property for determining gain or
loss on the sale or other disposition of property, or for
determining depreciation, shall be reduced to the extent the property
was acquired with a grant or other amount that was provided to a
person by the State Air Resources Board, an air pollution control
district, or an air quality management district for the purpose of
air pollution reduction. 
   SEC. 3.   SEC. 5.   This act provides
for a tax levy within the meaning of Article IV of the Constitution
and shall go into immediate effect.