AB 2326, as introduced, Dickinson. Personal income tax: deductions: pet adoption costs: voluntary contributions.
(1) The Personal Income Tax Law authorizes various deductions in computing income that is subject to tax under that law.
This bill, for taxable years beginning on or after January 1, 2015, and before January 1, 2020, would allow a deduction from gross income, not to exceed $100, under that law for the qualified costs paid or incurred by a taxpayer for the adoption of a pet from a qualified animal rescue organization.
(2) The Personal Income Tax Law authorizes taxpayers to contribute amounts in excess of their tax liability for the support of specified funds.
This bill would authorize taxpayers to designate on their tax return that a specified amount in excess of their tax liability be transferred to the Pet Adoption Cost Deduction Fund, which would be created by this bill. The bill would prohibit a voluntary contribution designation for the Pet Adoption Cost Deduction Fund from being added on the tax return until another voluntary contribution designation is removed.
The bill would require moneys in the Pet Adoption Cost Deduction Fund, upon appropriation by the Legislature, to be allocated to the Franchise Tax Board, to the Controller for reimbursement of costs in connection with providing personal income tax deductions for pet adoptions, as provided, and the balance to the Department of Food and Agriculture for the distribution of grants to eligible municipal shelters, as defined, for the purpose of providing food and shelter to abandoned and impounded animals, as specified.
The bill would provide that these provisions would remain in effect only until January 1 of the 5th taxable year following the first appearance of the Pet Adoption Cost Deduction Fund on the tax return, but would further provide for an earlier repeal if the Franchise Tax Board determines that the amount of contributions estimated to be received during a calendar year will not equal or exceed the minimum contribution amount, as defined, for that calendar year, in which case these provisions would be repealed on December 1 of that year.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 17072 of the Revenue and Taxation Code
2 is amended to read:
(a) Section 62 of the Internal Revenue Code, relating
4to adjusted gross income defined, shall apply, except as otherwise
6(b) Section 62(a)(2)(D) of the Internal Revenue Code, relating
7to certain expenses of elementary and secondary school teachers,
8shall not apply.
9(c) Section 62(a)(21) of the Internal Revenue Code, relating to
10attorneys fees relating to awards to whistleblowers, shall not apply.
Section 17239 is added to the Revenue and Taxation
16Code, to read:
(a) For each taxable year beginning on or after January
181, 2015, and before January 1, 2020, there shall be allowed as a
19deduction an amount equal to the qualified costs paid or incurred
20during the taxable year by a taxpayer for the adoption of a pet from
21a qualified animal rescue organization.
P3 1(b) For the purposes of this section, the following definitions
3(1) “Pet” means an animal adopted from a qualified animal
4rescue organization that is not used by the taxpayer in a trade or
5business or for the production of income.
6(2) “Qualified animal rescue organization” means a public
7animal control agency or shelter, humane society shelter, or rescue
9(3) “Qualified costs” means amounts paid or incurred to a
10qualified animal rescue organization to adopt a pet, not to exceed
11one hundred dollars ($100).
12(4) “Rescue group” means an organization exempt from federal
13income taxation as, an organization described in Section 501(c)(3)
14of the Internal Revenue Code, whose primary purpose is the
15placement of dogs, cats, or other animals that have been removed
16from a public animal control agency or shelter, society for the
17prevention of cruelty to animals shelter, or humane society, or that
18have been surrendered or relinquished to the rescue group by the
20(c) The deduction allowed under this section for a taxable year
21shall not exceed one hundred dollars ($100).
22(d) This section shall remain in effect only until December 1,
232020, and as of that date is repealed.
Article 18 (commencing with Section 18887) is added
25to Chapter 3 of Part 10.2 of Division 2 of the Revenue and Taxation
26Code, to read:
(a) An individual may designate on the tax return that
31a contribution in excess of the tax liability, if any, be made to the
32Pet Adoption Cost Deduction Fund established by Section 18888.
33That designation is to be used as a voluntary contribution on the
35(b) The contributions shall be in full dollar amounts and may
36be made individually by each signatory on a joint return.
37(c) A designation under subdivision (a) shall be made for a
38taxable year on the original return for that taxable year, and once
39made shall be irrevocable. If payments and credits reported on the
40return, together with any other credits associated with the
P4 1individual’s account, do not exceed the individual’s liability, the
2return shall be treated as though no designation has been made. If
3a designee is not specified, the contribution shall be transferred to
4the General Fund after reimbursement of the direct actual costs of
5the Franchise Tax Board for the collection and administration of
6funds under this article.
7(d) If an individual designates a contribution to more than one
8account or fund listed on the tax return, and the amount available
9is insufficient to satisfy the total amount designated, the
10contribution shall be allocated among the designees on a pro rata
12(e) The Franchise Tax Board shall revise the form of the return
13to include a space labeled “Pet Adoption Cost Deduction Fund”
14to allow for the designation permitted under subdivision (a). The
15form shall also include in the instructions information that the
16contribution may be in the amount of one dollar ($1) or more and
17that the contribution shall be used to reimburse the California State
18General Fund for the reduction in receipts attributable to the Pet
19Adoption Fee Deduction allowed pursuant to Section 17239, with
20any contributions in excess of the reduction in receipts used to
21provide grants to eligible municipal shelters for the purpose of
22providing food and shelter to abandoned and impounded animals.
23(f) Notwithstanding any other law, a voluntary contribution
24designation for the Pet Adoption Cost Deduction Fund shall not
25be added on the tax return until another voluntary contribution
26designation is removed.
27(g) A deduction shall be allowed under Article 6 (commencing
28with Section 17201) of Chapter 3 of Part 10 for any contribution
29made pursuant to subdivision (a).
There is hereby established in the State Treasury the
31Pet Adoption Cost Deduction Fund to receive contributions made
32pursuant to Section 18887. The Franchise Tax Board shall notify
33the Controller of both the amount of money paid by taxpayers in
34excess of their tax liability and the amount of refund money that
35taxpayers have designated pursuant to Section 18887 to be
36transferred to the Pet Adoption Cost Deduction Fund. The
37Controller shall transfer from the Personal Income Tax Fund to
38the Pet Adoption Cost Deduction Fund an amount not in excess
39of the sum of the amounts designated by individuals pursuant to
40Section 18887 for payment into that fund.
All moneys transferred to the Pet Adoption Cost
2Deduction Fund, upon appropriation by the Legislature, shall be
3allocated as follows:
4(a) To the Franchise Tax Board and the Controller for
5reimbursement of all costs incurred by the Franchise Tax Board
6and the Controller in connection with their duties under this article.
7(b) To the Controller for reimbursement of all losses incurred
8by the General Fund in connection with providing tax deductions
9for pet adoptions pursuant to Section 17239.
10(c) (1) To the Department of Food and Agriculture for
11distribution of grants to eligible municipal shelters for the purpose
12of providing food and shelter to abandoned and impounded
13animals. The department may use up to 5 percent of the money
14allocated to municipal shelters for administrative costs incurred
15in connection with the Pet Adoption Fee Deduction Fund.
16(2) For the purposes of this article, “eligible municipal shelter”
17means a city or county animal control agency or shelter that is
18current on its reporting requirements to the State Department of
19Public Health, Veterinary Public Health Section. The State
20Department of Public Health shall, upon the written request of the
21Department of Food and Agriculture, make available information
22regarding whether a city or county animal control agency or shelter
23is current on its reporting requirements pursuant to this paragraph.
24(3) The Department of Food and Agriculture shall
do all of the
25following with respect to the distribution of grants:
26(A) Accept applications for grants from eligible municipal
28(B) Process and approve, or reject all applications on a
29first-come-first-served basis, in the following manner:
30(i) Eligible municipal shelters processing fewer than 5,000 dogs
31and cats each year shall receive up to seven thousand five hundred
32dollars ($7,500), if funds are available.
33(ii) Eligible municipal shelters processing between 5,000 and
3425,000 dogs and cats each year shall receive up to fifteen thousand
35dollars ($15,000), if funds are available.
36(iii) Eligible municipal shelters processing more than 25,000
37dogs and cats shall receive up to twenty-two thousand five hundred
38dollars ($22,500), if funds are available.
P6 1(C) Make applications available to eligible municipal shelters
2on the first day of the second calendar year after the Pet Adoption
3Fee Deduction Fund first appears on the tax return.
4(d) In order to be eligible for grants authorized by this article,
5eligible municipal shelters shall file an application with the
6Department of Food and Agriculture, in the form and manner as
7specified by the Department of Food and Agriculture.
8(e) Any grants distributed under this article create an additional
9funding source for food and shelter services and programs for
10eligible municipal shelters and shall be used to supplement, not
11supplant, other funding sources for these services and programs.
(a) Except as otherwise provided in subdivision (b),
13this article shall remain in effect only until January 1 of the fifth
14taxable year following the first appearance of the Pet Adoption
15Cost Deduction Fund on the personal income tax return, and is
16repealed as of December 1 of that year.
17(b) (1) By September 1 of the second calendar year and each
18subsequent calendar year that the Pet Adoption Cost Deduction
19Fund appears on the tax return, the Franchise Tax Board shall do
20all of the following:
21(A) Determine the minimum contribution amount required to
22be received during the next calendar year for the fund to appear
23on the tax return for the taxable year that includes that next calendar
25(B) Provide written notification to the Department of Food and
26Agriculture of the amount determined in subparagraph (A).
27(C) Determine whether the amount of contributions estimated
28to be received during the calendar year will equal or exceed the
29minimum contribution amount determined by the Franchise Tax
30Board for the calendar year pursuant to subparagraph (A). The
31Franchise Tax Board shall estimate the amount of contributions
32to be received by using the actual amounts received and an estimate
33of the contributions that will be received by the end of that calendar
35(2) If the Franchise Tax Board determines that the amount of
36the contributions estimated to be received during a calendar year
37will not at least equal the minimum contribution amount for the
38calendar year, this article shall be inoperative with respect to
39taxable years beginning on or after January 1 of that calendar year
40and shall be repealed on December 1 of that year.
P7 1(3) For purposes of this section, the minimum contribution
2amount for a calendar year means two hundred fifty thousand
3dollars ($250,000) for the second calendar year after the first
4appearance of the Pet Adoption Cost Deduction Fund on the
5personal income tax return or the minimum contribution amount
6as adjusted pursuant to subdivision (c).
7(c) For each calendar year, beginning with the third calendar
8year after the first appearance of the Pet Adoption Cost Deduction
9Fund on the personal income tax return, the Franchise Tax Board
10shall adjust, on or before September 1 of that calendar year, the
11minimum contribution amount specified in subdivision (b) as
13(1) The minimum contribution amount for the calendar year
14shall be an amount equal to the product of the minimum
15contribution amount for the prior calendar year multiplied by the
16inflation factor adjustment as specified in subparagraph (A) of
17paragraph (2) of subdivision (h) of Section 17041, rounded off to
18the nearest dollar.
19(2) The inflation factor adjustment used for the calendar year
20shall be based on the figures for the percentage change in the
21California Consumer Price Index for all items received on or before
22August 1 of the calendar year pursuant to paragraph (1) of
23subdivision (h) of Section 17041.
24(d) Notwithstanding the repeal of this article, any contribution
25amounts designated pursuant to this article prior to its repeal shall
26continue to be transferred and disbursed in accordance with this
27article as in effect immediately prior to that repeal.