BILL NUMBER: AB 2582	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MAY 12, 2016

INTRODUCED BY   Assembly Member Maienschein

                        FEBRUARY 19, 2016

   An act to add  and repeal  Sections 17053.75 and 23675
 to   of  the Revenue and Taxation Code,
relating to taxation, to take effect immediately, tax levy.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2582, as amended, Maienschein. Income taxes: credit: employees
with disabilities.
   The Personal Income Tax Law and the Corporation Tax Law allow
various credits against the taxes imposed by those laws.
   This bill, for taxable years beginning on and after January 1,
2017,  and before January 1, 2022,  would allow a credit
under those laws to an employer who pays a qualified employee a wage
equal to or exceeding the state minimum wage during the taxable year,
as provided. The bill would define a qualified employee as an
individual with a disability who may be paid a special minimum wage
under existing state or federal law. The credit would be allowed in
an amount equal to the difference between the special minimum wage
and the state minimum wage, multiplied by the hours worked by the
qualified employee.  The bill would require the Franchise Tax
Board to submit a report containing specified data relating to these
credits to the Legislature by June 1, 2022. 
   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 17053.75 is added to the Revenue and Taxation
Code, to read:
   17053.75.  (a) For taxable years beginning on or after January 1,
2017,  and before January 1, 2022,  there shall be allowed a
credit against the "net tax," as defined by Section 17039, to a
qualified employer who pays a qualified employee a wage that equals
or exceeds the state minimum wage during the taxable year.
   (b) The credit shall be in an amount that is equal to the
difference between the special minimum wage that may be paid to the
qualified employee and the state minimum wage, multiplied by the
number of hours worked by the qualified employee for the qualified
employer during the taxable year.
   (c) For purposes of this section, the following definitions shall
apply:
   (1) "Minimum wage" means the wage established by the Industrial
Welfare Commission as provided for in Chapter 1 (commencing with
Section 1171) of Part 4 of Division 2 of the Labor Code.
   (2) "Qualified employee" means an individual who may be paid a
special minimum wage pursuant to Section 214(c) of Title 29 of the
United States Code or Section 1191 or 1191.5 of the Labor 
Code.   Code that is subject to withholding pursuant to
Division 6 (commencing with Section 13000) of   the
Unemployment Insurance Code. 
   (3) (A) "Qualified employer" means a taxpayer that employs a
qualified employee in this state.
   (B) In the case of any pass-thru entity, the determination of
whether a taxpayer is a qualified employer under this section shall
be made at the entity level, and any credit under this section or
Section 23675 shall be allowed to the pass-thru entity and passed
through to the partners or shareholders in accordance with applicable
provisions of this part or Part 11 (commencing with Section 23001).
For purposes of this section, the term "pass-thru entity" means any
partnership or "S" Corporation.
   (d) A qualified employer shall do both of the following:
   (1) Obtain from the Industrial Welfare Commission a certification
that a qualified employee meets the eligibility requirements of
paragraph (2) of subdivision (c). The certification shall include the
dollar amount of special minimum wage applicable to each qualified
employee.
   (2) Retain the certification and provide a copy of it upon request
to the Franchise Tax Board.
   (e) The Franchise Tax Board may prescribe rules, guidelines, or
procedures necessary or appropriate to carry out the purposes of this
section. 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) In the case where any credit allowed by this section exceeds
the net "tax," the excess may be carried over to reduce the "net tax"
in the following year, and succeeding years if necessary, until this
section is repealed.  
   (g) On or before June 1, 2022, the Franchise Tax Board shall
submit a report to the Legislature in compliance with Section 9795 of
the Government Code that contains the following:  
   (1) The number of Californians with developmental disabilities
employed during each year of the operative period of this section and
Section 23675.  
   (2) The number of employers who used and applied for a credit
authorized by this section and Section 23675 each year.  
   (3) The number of employees for whom a credit authorized by this
section and Section 23675 was claimed.  
   (h) This section shall remain in effect only until December 1,
2022, and as of that date is repealed. 
  SEC. 2.  Section 23675 is added to the Revenue and Taxation Code,
to read:
   23675.  (a) For taxable years beginning on or after January 1,
2017,  and before January 1, 2022,  there shall be allowed a
credit against the "tax," as defined by Section 23036, to a
qualified employer who pays a qualified employee a wage that equals
or exceeds the state minimum wage during the taxable year.
   (b) The credit shall be in an amount that is equal to the
difference between the special minimum wage that may be paid to the
qualified employee and the state minimum wage, multiplied by the
number of hours worked by the qualified employee for the qualified
employer during the taxable year.
   (c) For purposes of this section, the following definitions shall
apply:
   (1) "Minimum wage" means the wage established by the Industrial
Welfare Commission as provided for in Chapter 1 (commencing with
Section 1171) of Part 4 of Division 2 of the Labor Code.
   (2) "Qualified employee" means an individual who may be paid a
special minimum wage pursuant to Section 214(c) of Title 29 of the
United States Code or Section 1191 or 1191.5 of the Labor 
Code.   Code that is subject to withholding pursuant to
Division 6 (commencing with Section 13000) of the  
Unemployment Insurance Code. 
   (3) (A) "Qualified employer" means a taxpayer that employs a
qualified employee in this state.
   (B) In the case of any pass-thru entity, the determination of
whether a taxpayer is a qualified taxpayer under this section shall
be made at the entity level, and any credit under this section or
Section 17053.75 shall be allowed to the pass-thru entity and passed
through to the partners in accordance with applicable provisions of
this part or Part 10 (commencing with Section 17001). For purposes of
this subparagraph, the term "pass-thru entity" means any
partnership.
   (d) A qualified employer shall do both of the following:
   (1) Obtain from the Industrial Welfare Commission a certification
that a qualified employee meets the eligibility requirements of
paragraph (2) of subdivision (c). The certification shall include the
dollar amount of special minimum wage applicable to each qualified
employee.
   (2) Retain the certification and provide a copy of it upon request
to the Franchise Tax Board.
   (e) The Franchise Tax Board may prescribe rules, guidelines, or
procedures necessary or appropriate to carry out the purposes of this
section. 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) In the case where any credit allowed by this section exceeds
the "tax," the excess may be carried over to reduce the "tax" in the
following year, and succeeding years if necessary, until this section
is repealed.  
   (g) On or before June 1, 2022, the Franchise Tax Board shall
submit a report to the Legislature in compliance with Section 9795 of
the Government Code that contains the following:  
   (1) The number of Californians with developmental disabilities
employed during each year of the operative period of this section and
Section 17053.75.  
   (2) The number of employers who used and applied for a credit
authorized by this section and Section 17053.75 each year.  

   (3) The number of employees for whom a credit authorized by this
section and Section 17053.75 was claimed.  
   (h) This section shall remain in effect only until December 1,
2022, and as of that date is repealed. 
  SEC. 3.  It is the intent of the Legislature to enact legislation
to comply with the requirements of Section  41. 
 41 of the Revenue and Taxation Code. 
  SEC. 4.  This act provides for a tax levy within the meaning of
Article IV of the  California  Constitution and shall go
into immediate effect.