Amended in Assembly May 22, 2015

California Legislature—2015–16 Regular Session

Assembly Bill No. 1275

Introduced by Assembly Member Gray

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(Coauthors: Assembly Members Brough and Dababneh)

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February 27, 2015

An act to add Section 17132.9 to the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.

LEGISLATIVE COUNSEL’S DIGEST

AB 1275, as amended, Gray. Personal income taxes: exclusion: military retirement pay.

The Personal Income Tax Law provides various exclusions from gross income in determining tax liability, including an exclusion for combat-related special compensation and death benefit payments received by a surviving spouse or other beneficiary designated by a military veteran, as prescribed, who dies or is killed in the performance of duty, as provided.

This bill would, for taxable years beginning on or after January 1, 2015, exclude from gross income retirement pay received by a begin insert qualified end insert taxpayer from the federal government for military service performed in the Armed Forces of the United States, the reserve component of the Armed Forces of the United States, or the National Guard, and survivor benefits received by a begin insert beneficiary of a qualified end insert taxpayer from the federal government, as specified. begin insert The bill would define “qualified taxpayer” for those purposes as a taxpayer who is a Purple Heart or Medal of Honor recipient. end insert

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 17132.9 is added to the Revenue and
Taxation Code, to read:

17132.9.  

(a) For each taxable year beginning on or after
January 1, 2015, gross income shall not include retirement pay
received by a begin insert qualified end insert taxpayer from the federal government for
military service performed in the Armed Forces of the United
States, the reserve component of the Armed Forces of the United
States, or the National Guard.

(b) For each taxable year beginning on or after January 1, 2015,
gross income shall not include survivor benefits received by a
begin insert beneficiary of a qualified end insert taxpayer from the federal government
pursuant to Chapter 73 of Title 10 of the United States Code.

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(c) “Qualified taxpayer” means a taxpayer who is a Purple
Heart or Medal of Honor recipient.

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SEC. 2.  

This act provides for a tax levy within the meaning
of Article IV of the Constitution and shall go into immediate effect.