BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                            



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                                    THIRD READING


          Bill No:  AB 922
          Author:   Maienschein (R)
          Amended:  6/25/14 in Senate
          Vote:     21

           
           SENATE GOVERNANCE & FINANCE COMMITTEE  :  7-0, 6/18/14
          AYES:  Wolk, Knight, Beall, DeSaulnier, Hernandez, Liu, Walters

           SENATE APPROPRIATIONS COMMITTEE  :  Senate Rule 28.8

           ASSEMBLY FLOOR  :  Prior votes not relevant


           SUBJECT  :    Income taxes:  deductions: disaster relief:  County  
          of San Diego

           SOURCE  :     Author


           DIGEST  :    This bill allows taxpayers affected by wildfires  
          occurring in the County of San Diego in 2014 who incurred losses  
          during the state of emergency declared by the Governor to carry  
          back those losses to the 2013 taxable year.  This bill also  
          allows affected taxpayers to file an amended return on or before  
          the extended due dates for the 2014 taxable year.

           ANALYSIS  :    Federal law, which California conforms to, allows  
          disaster loss deductions for personal income taxes that exceed  
          $100 per taxpayer and 10% of their adjusted gross income for the  
          year.  Current state and federal law allows taxpayers to deduct  
          them in the year the loss occurs or in the preceding year by  
          filing an amended return, but only when the President declares a  
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          disaster.  

          Starting with the forest fires in 1985, and approximately 50  
          times thereafter for various disasters, the Legislature enacted  
          measures that provide treatment identical to Presidentially  
          declared disasters by allowing affected taxpayer to file amended  
          returns, carry-forward 100% of excess disaster losses for  
          fifteen years, and apply losses in the previous taxable year  
          before applying them to taxes in the current taxable year.

          This bill allows taxpayers affected by wildfires occurring in  
          the County of San Diego in 2014 who incurred losses during the  
          state of emergency declared by the Governor to carry back those  
          losses to the 2013 taxable year.  This bill also allows affected  
          taxpayers to file an amended return on or before the extended  
          due dates for the 2014 taxable year.

          This bill allows San Diego taxpayers that incurred a net  
          operating loss as a result of the San Diego fires in 2014 to  
          elect to carry back 100% of the net operating loss to the  
          preceding two taxable years.

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes    
          Local:  No

           SUPPORT  :   (Verified  8/5/14)

          San Diego County Board of Supervisors
          San Diego Regional Chamber of Commerce

           ARGUMENTS IN SUPPORT  :    According to the author, "May 5, 2014  
          marks the beginning of what could possibly be one of the most  
          devastating fire seasons in San Diego County.  In nearly three  
          weeks, roughly 29,000 acres burned across the county from 19  
          separate fires. Conditions were intensified by high temperatures  
          and the Santa Ana winds.  It has been estimated that these fires  
          have cost nearly $30 million in damage and destruction to  
          personal and private property and an-other $30 million to fight  
          the fires.  Homes, schools and businesses experienced  
          evacuation, and residents had their lives turned upside down.   
          On May 15, 2014 Governor Brown declared a State of Emergency in  
          San Diego County in response to the disastrous string of fires  
          that ripped through the county.  This bill allows residents of  
          San Diego County that suffered losses to their homes and  







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          businesses during the wildfires of May 2014 to elect to claim a  
          deduction for those losses on the previous year's tax return by  
          filing an amended return of that year's taxes resulting in an  
          expedited payment for their losses.  In addition, any losses in  
          excess of the limits of that taxable year can be carried forward  
          for a maximum of the following 20 years as loss deductions up to  
          100% of the disaster losses reported during the San Diego County  
          fires started in May of 2014.  This bill will help those 
          individuals who have suffered a great loss during this state  
          declared disaster to get back on their feet.  It helps to ease  
          the pain felt by those who have lost more than the state can  
          ever replace and at least offer a small comfort."


          AB:d  8/6/14   Senate Floor Analyses 

                           SUPPORT/OPPOSITION:  SEE ABOVE

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