as amended, Steinorth. Personal income tax: deductions: pet adoption
begin delete costs: voluntary contributions.end delete
(1) Theend delete
Personal Income Tax Law, in modified conformity with federal income tax laws, allows various deductions in computing the income that is subject to the taxes imposed by that law, including miscellaneous itemized deductions that are allowed only to the extent that the aggregate amount of those deductions exceed 2% of adjusted gross income.
This bill, for taxable years beginning on or after January 1, 2016, and before January 1, 2021, would allow a deduction, 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) Existing law authorizes an individual to contribute amounts in excess of his or her personal income tax liability for the support of specified funds.end delete
This bill would allow an individual to designate on his or her tax return that a specified amount in excess of his or her 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.end delete
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 losses 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.end delete
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 at least equal the minimum contribution amount, as defined, for that calendar year, in which case these provisions would be repealed on December 1 of that year.end delete
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 17239 is added to the Revenue and
2Taxation Code, to read:
(a) For each taxable year beginning on or after January
41, 2016, and before January 1, 2021, there shall be allowed as a
5deduction an amount equal to the qualified costs paid or incurred
6during the taxable year by a taxpayer for the adoption of a
7 pet from a qualified animal rescue organization.
8(b) For the purposes of this section, the following definitions
P3 1(1) “Pet” means an animal adopted from a qualified animal
2rescue organization that is not used by the taxpayer in a trade or
3business or for the production of income.
5 “Qualified animal rescue organization” means a public
6animal control agency or shelter, humane society shelter, or rescue
9 “Qualified costs” means amounts paid or incurred to a
10qualified animal rescue organization to adopt a pet, not to exceed
11one hundred dollars ($100).
25(4) “Rescue group” means an organization exempt from federal
26income taxation as
begin delete,end delete an organization described in Section 501(c)(3)
27of the Internal Revenue Code, whose primary purpose is the
28placement of dogs, cats, or other animals that have been removed
29from a public animal control agency or shelter, society for the
30prevention of cruelty to animals shelter, or humane society, or that
31have been surrendered or relinquished to the rescue group by the
33(c) The deduction allowed under this section for a taxable year
34shall not exceed one hundred dollars ($100).
35(d) This section shall remain in effect only until December 1,
362021, and as of that date is repealed.
Article 18 (commencing with Section 18887) is added
38to Chapter 3 of Part 10.2 of Division 2 of the Revenue and Taxation
39Code, to read:
(a) An individual may designate on the tax return that
4a contribution in excess of the tax liability, if any, be made to the
5Pet Adoption Cost Deduction Fund established by Section 18888.
6That designation is to be used as a voluntary contribution on the
8(b) The contributions shall be in a full dollar amount and may
9be made individually by each signatory on a joint return.
10(c) A designation under subdivision (a) shall be made for a
11taxable year on the original return for that taxable year, and once
12made shall be irrevocable. If payments and credits reported on the
13return, together with any other credits associated with the
14individual’s account, do not exceed the individual’s liability, if
15any, the return shall be treated as though no designation has been
16made. If a contribution is not specified, but a designee is not
17specified, the contribution shall be transferred to the General Fund
18after reimbursement of the direct actual costs of the Franchise Tax
19Board for the collection and administration of funds under this
21(d) If an individual designates a contribution to more than one
22account or fund listed on the tax return, and the amount available
23is insufficient to satisfy the total amount designated, the
24contribution shall be allocated among the designees on a pro rata
26(e) The Franchise Tax Board shall revise the form of the return
27to include a space labeled “Pet Adoption Cost Deduction Fund”
28to allow for the designation permitted under subdivision (a). The
29form shall also include in the instructions information that the
30 contribution may be in the amount of one dollar ($1) or more and
31that the contribution shall be used to reimburse the California State
32General Fund for the reduction in receipts attributable to the Pet
33Adoption Fee Deduction allowed pursuant to Section 17239, with
34any contributions in excess of the reduction in receipts used to
35provide grants to eligible municipal shelters for the purpose of
36providing food and shelter to abandoned and impounded animals,
37as described in Section 18889.
38(f) Notwithstanding any other law, a voluntary contribution
39designation for the Pet Adoption Cost Deduction Fund shall not
P5 1be added on the tax return until another voluntary contribution
2designation is removed.
3(g) A deduction shall be allowed under Article 6 (commencing
4with Section 17201) of Chapter 3 of Part 10 for any contribution
5made pursuant to subdivision (a).
There is hereby established in the State Treasury the
7Pet Adoption Cost Deduction Fund to receive contributions made
8pursuant to Section 18887. The Franchise Tax Board shall notify
9the Controller of both the amount of money paid by taxpayers in
10excess of their tax liability and the amount of refund money that
11taxpayers have designated pursuant to Section 18887 to be
12transferred to the Pet Adoption Cost Deduction Fund. The
13Controller shall transfer from the Personal Income Tax Fund to
14the Pet Adoption Cost Deduction Fund an amount not in excess
15of the sum of the amounts designated by individuals pursuant to
16Section 18887 for payment into that fund.
All moneys transferred to the Pet Adoption Cost
18Deduction Fund, upon appropriation by the Legislature, shall be
19allocated as follows:
20(a) To the Franchise Tax Board and the Controller for
21reimbursement of all costs incurred by the Franchise Tax Board
22and the Controller in connection with their duties under this article.
23(b) To the Controller for reimbursement of all losses incurred
24by the General Fund in connection with providing tax deductions
25for pet adoptions pursuant to Section 17239.
26(c) (1) To the Department of Food and Agriculture for
27distribution of grants to eligible municipal shelters for the purpose
28of providing food and shelter to abandoned and impounded
29animals. The department may use up to 5 percent of the money
30allocated to municipal shelters for administrative costs incurred
31in connection with the Pet Adoption Fee Deduction Fund.
32(2) For the purposes of this article, “eligible municipal shelter”
33means a city or county animal control agency or shelter that is
34current on its reporting requirements to the State Department of
35Public Health, Veterinary Public Health Section. The State
36Department of Public Health shall, upon the written request of the
37Department of Food and Agriculture, make available information
38regarding whether a city or county animal control agency or shelter
39is current on its reporting requirements pursuant to this paragraph.
P6 1(3) The Department of Food and Agriculture shall
do all of the
2following with respect to the distribution of grants:
3(A) Accept applications for grants from eligible municipal
5(B) Process and approve, or reject all applications on a
6first-come-first-served basis, in the following manner:
7(i) Eligible municipal shelters processing fewer than 5,000 dogs
8and cats each year shall receive up to seven thousand five hundred
9dollars ($7,500), if funds are available.
10(ii) Eligible municipal shelters processing between 5,000 and
1125,000 dogs and cats each year shall receive up to fifteen thousand
12dollars ($15,000), if funds are available.
13(iii) Eligible municipal shelters processing more than 25,000
14dogs and cats shall receive up to twenty-two thousand five hundred
15dollars ($22,500), if funds are available.
16(C) Make applications available to eligible municipal shelters
17on the first day of the second calendar year after the Pet Adoption
18Fee Deduction Fund first appears on the tax return.
19(d) In order to be eligible for grants authorized by this article,
20eligible municipal shelters shall file an application with the
21Department of Food and Agriculture, in the form and manner as
22specified by the Department of Food and Agriculture.
23(e) Any grants distributed under this article create an additional
24funding source for food and shelter services and programs for
25eligible municipal shelters and shall be used to supplement, not
26supplant, other funding sources for these services and programs.
(a) Except as otherwise provided in subdivision (b),
28this article shall remain in effect only until January 1 of the fifth
29taxable year following the first appearance of the Pet Adoption
30Cost Deduction Fund on the personal income tax return, and is
31repealed as of December 1 of that year.
32(b) (1) By September 1 of the second calendar year and each
33subsequent calendar year that the Pet Adoption Cost Deduction
34Fund appears on the tax return, the Franchise Tax Board shall do
35all of the following:
36(A) Determine the minimum contribution amount required to
37be received during the next calendar year for the fund to appear
38on the tax return for the taxable year that includes that next calendar
P7 1(B) Provide written notification to the Department of Food and
2Agriculture of the amount determined in subparagraph (A).
3(C) Determine whether the amount of contributions estimated
4to be received during the calendar year will equal or exceed the
5minimum contribution amount determined by the Franchise Tax
6Board for the calendar year pursuant to subparagraph (A). The
7Franchise Tax Board shall estimate the amount of contributions
8to be received by using the actual amounts received and an estimate
9of the contributions that will be received by the end of that calendar
11(2) If the Franchise Tax Board determines that the amount of
12the contributions estimated to be received during a calendar year
13will not at least equal the minimum contribution amount for the
14calendar year, this article shall be inoperative with respect to
15taxable years beginning on or after January 1 of that calendar year
16and shall be repealed on December 1 of that year.
17(3) For purposes of this section, the minimum contribution
18amount for a calendar year means two hundred fifty thousand
19dollars ($250,000) for the second calendar year after the first
20appearance of the Pet Adoption Cost Deduction Fund on the
21personal income tax return or the minimum contribution amount
22as adjusted pursuant to subdivision (c).
23(c) For each calendar year, beginning with the third calendar
24year after the first appearance of the Pet Adoption Cost Deduction
25Fund on the personal income tax return, the Franchise Tax Board
26shall adjust, on or before September 1 of that calendar year, the
27minimum contribution amount specified in subdivision (b) as
29(1) The minimum contribution amount for the calendar year
30shall be an amount equal to the product of the minimum
31contribution amount for the prior calendar year multiplied by the
32inflation factor adjustment as specified in subparagraph (A) of
33paragraph (2) of subdivision (h) of Section 17041, rounded off to
34the nearest dollar.
35(2) The inflation factor adjustment used for the calendar year
36shall be based on the figures for the percentage change in the
37California Consumer Price Index for all items received on or before
38August 1 of the calendar year pursuant to paragraph (1) of
39subdivision (h) of Section 17041.
P8 1(d) Notwithstanding the repeal of this article, any contribution
2amounts designated pursuant to this article prior to its repeal shall
3continue to be transferred and disbursed in accordance with this
4article as in effect immediately prior to that repeal.