BILL NUMBER: AB 17	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MAY 7, 2015
	AMENDED IN ASSEMBLY  APRIL 21, 2015

INTRODUCED BY   Assembly Member Bonilla
    (   Coauthors:   Assembly Members 
 Baker,   Calderon,   Chávez,  
Dababneh,   Dodd,   Cristina Garcia,  
Lackey,   Maienschein,   Salas,  
Steinorth,   and Waldron   ) 
    (   Coauthors:   Senators   Allen
  and Vidak   ) 

                        DECEMBER 1, 2014

   An act to add and repeal Section 17053 of the Revenue and Taxation
Code, relating to taxation, to take effect immediately, tax levy.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 17, as amended, Bonilla. Personal income taxes: credit:
qualified tuition program.
   The Personal Income Tax Law allows various credits against the
taxes imposed by that law.
   This bill would, for taxable years beginning on or after January
1, 2016, and before January 1, 2021, allow a credit under the
Personal Income Tax Law in an amount equal to 20% of the monetary
contributions made to one or more qualified tuition programs, as
defined, by a qualified taxpayer, as defined, during the taxable
year, not to exceed $500. This bill would provide that the credit
amount in excess of tax liability is refundable in those years in
which an appropriation for that purpose is made by the Legislature.
   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 17053 is added to the Revenue and Taxation
Code, to read:
   17053.  (a) (1) For each taxable year beginning on or after
January 1, 2016, and before January 1, 2021, there shall be allowed
to a qualified taxpayer a credit against the "net tax," as defined in
Section 17039, in an amount as determined by paragraph (2).
   (2) The credit amount allowed pursuant to this section shall be
the lesser of the following:
   (A) Twenty percent of the monetary contributions made by a
qualified taxpayer to one or more qualified tuition programs during
the taxable year.
   (B) Five hundred dollars ($500).
   (b) For the purposes of this section:
   (1) "Nonqualified withdrawal" means  any   a
 payment or distribution from a qualified tuition program that
is subject to additional tax pursuant to Section 529(c)(6) of the
Internal Revenue Code, relating to additional tax.
   (2) "Qualified taxpayer" means an individual who, on behalf of a
beneficiary, contributes money to a qualified tuition program for
which the individual is the account owner and has one of the
following annual adjusted gross incomes:
   (A) In the case of a single individual or married individual
filing a separate return, one hundred thousand dollars ($100,000) or
less.
   (B) In the case of a head of household or surviving spouse, as
defined in Section 17046, or a married couple filing a joint return,
two hundred thousand dollars ($200,000) or less.
   (3) "Qualified tuition program" means a qualified tuition program,
as defined in Section 529 of the Internal Revenue Code.
   (c) When a qualified taxpayer receives a nonqualified withdrawal,
in addition to any tax imposed under this part, an additional tax
shall be imposed in an amount that is the lesser of 10 percent of
that nonqualified withdrawal or the total amount of credit allowed
under subdivision (a) for the taxable year and all prior taxable
years in which the qualified taxpayer was allowed a credit pursuant
to this section.
   (d) That portion of any credit allowed under this section that is
in excess of tax liability shall be credited against other amounts
due, if any, and the balance, if any, upon an appropriation by the
Legislature, be refunded to the qualified taxpayer.
   (e) (1) The Franchise Tax Board may prescribe rules, guidelines,
or procedures necessary or appropriate to carry out the purposes of
this section.
   (2) Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code does not apply to any
standard, criterion, procedure, determination, rule, notice, or
guideline established or issued by the Franchise Tax Board pursuant
to this section.
   (f) This section shall remain in effect only until December 1,
2021, and as of that date is repealed.
  SEC. 2.  This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.