SB 471, as introduced, Berryhill. Personal income taxes: credit.
The Personal Income Tax Law allows for various tax credits in computing the taxes imposed by that law, including a credit against “net tax” for the taxable year in an amount equal to 5% of qualified wages received by a taxpayer attributable to services performed in an enterprise zone during the taxable year.
This bill would make a technical, nonsubstantive change to that provision.
Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 17053.75 of the Revenue and Taxation
2Code is amended to read:
(a) There shall be allowed as a credit against the
4“netbegin delete tax” (asend deletebegin insert tax,” asend insert defined by Sectionbegin delete 17039)end deletebegin insert 17039,end insert for the
5taxable year an amount equal to five percent of the qualified wages
6received by the taxpayer during the taxable year.
7(b) For purposes of this section:
8(1) “Qualified
employee” means a taxpayer who meets both of
9the following:
P2 1(A) Is described in clauses (i) and (ii) of subparagraph (A) of
2paragraph (4) of subdivision (b) of Section 17053.74.
3(B) Is not an employee of the federal government or of this state
4or of any political subdivision of this state.
5(2) (A) “Qualified wages” means “wages,” as defined in
6subsection (b) of Section 3306 of the Internal Revenue Code,
7attributable to services performed for an employer with respect to
8whom the taxpayer is a qualified employee in an amount that does
9not exceed one and one-half times the dollar limitation specified
10in that subsection.
11(B) “Qualified wages” does not include any compensation
12received from the federal government or this state or any
political
13subdivision of this state.
14(C) “Qualified wages” does not include any wages received on
15or after the date the enterprise zone designation expires, is no
16longer binding, or becomes inoperative.
17(3) “Enterprise zone” means any area designated as an enterprise
18zone pursuant to Chapter 12.8 (commencing with Section 7070)
19of Division 7 of Title 1 of the Government Code.
20(c) For each dollar of income received by the taxpayer in excess
21of qualified wages, as defined in this section, the credit shall be
22reduced by nine cents ($0.09).
23(d) The amount of the credit allowed by this section in any
24taxable year shall not exceed the amount of tax that would be
25imposed on the taxpayer’s income attributable to employment
26within the enterprise zone as if that
income represented all of the
27income of the taxpayer subject to tax under this part.
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