BILL NUMBER: AB 2490 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 11, 2016
AMENDED IN ASSEMBLY MARCH 17, 2016
INTRODUCED BY Assembly Member Gatto
FEBRUARY 19, 2016
An act to amend Section 19522 of the Revenue and Taxation
Code, relating to taxation. An act to add Section
23714 to the Revenue and Taxation Code, relating to taxation, to
take effect immediately, tax levy.
LEGISLATIVE COUNSEL'S DIGEST
AB 2490, as amended, Gatto. Franchise Tax Board: federal
tax law changes: report. Corporation Tax Law:
exemption: regulated investment company.
Existing law, the Corporation Tax Law, generally conforms to the
federal income tax laws that apply to a regulated investment company
and further provides that for purposes of the Corporation Tax Law,
its "net income" is equal to its "investment company income."
Existing law exempts from tax under the Corporation Tax Law, various
organizations including credit unions, fraternal societies, social
welfare organizations, and labor organizations.
This bill would exempt from tax under the Corporation Tax Law, a
regulated investment company that is a mutual fund investment
management company owned by investors in the mutual funds that it
serves.
This bill would take effect immediately as a tax levy.
Existing law requires the Franchise Tax Board to submit to the
Legislature, and to make available to the public, on or before
January 10 of each year, a report on all of the changes to the
Internal Revenue Code enacted into law in the prior year, as
provided.
This bill would instead require that report to be submitted and
made available on or before January 31 of each year. The bill would
make other nonsubstantive changes.
Vote: majority. Appropriation: no. Fiscal committee: no
yes . State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 23714 is added to the
Revenue and Taxation Code , to read:
23714. Notwithstanding any other law, a regulated investment
company, as defined in Section 851 of the Internal Revenue Code,
relating to definition of regulated investment company, that is a
mutual fund investment management company owned by the investors of
mutual fund that it serves.
SEC. 2. This act provides for a tax levy within
the meaning of Article IV of the Constitution and shall go into
immediate effect.
SECTION 1. Section 19522 of the Revenue and
Taxation Code is amended to read:
19522. (a) (1) (A) On or before January 31 of each year, the
Franchise Tax Board shall submit to the Legislature a report on all
changes to the Internal Revenue Code enacted into law in the prior
year. To the extent possible, the report shall contain an estimate of
the revenue effect of conforming California law to each of those
changes.
(B) In the event that changes to the Internal Revenue Code are
enacted after September 15 of any year, the report described in
subparagraph (A) shall be submitted to the Legislature within 120
days after signature by the President of the United States, rather
than January 31.
(2) The report required by this section shall be made available to
the public.
(3) It is the intent of the Legislature that the policy committee
of each house of the Legislature hold at least one public hearing on
the report required by this section.
(b) For any introduced bill that proposes changes in any of the
dates in Section 17024.5, the Franchise Tax Board shall prepare a
complete analysis of the bill that describes all changes to state law
that will automatically occur by reference to federal law as of the
changed date. The Franchise Tax Board shall immediately update and
supplement that analysis upon any amendment to the bill. That
analysis shall be made available to the public and shall be submitted
to the Legislature for publication in the daily journal of each
house of the Legislature. The digest of the Legislative Counsel shall
indicate that an analysis of the bill shall be prepared by the
Franchise Tax Board and printed in the daily journal of each house of
the Legislature.