California Legislature—2015–16 Regular Session

Assembly BillNo. 2768


Introduced by Assembly Member Thurmond

(Coauthors: Assembly Members Dababneh and Rodriguez)

(Coauthors: Senators Hueso and Mendoza)

February 19, 2016


An act to add and repeal Sections 17053.90 and 23690 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.

LEGISLATIVE COUNSEL’S DIGEST

AB 2768, as introduced, Thurmond. Income and corporation taxes: credit: donation of food.

The Personal Income Tax Law and the Bank and Corporation Tax Law allow various credits against the taxes imposed by those laws, including a credit for a farmer to donate fresh foods and vegetables to a food bank.

This bill would allow a credit against those taxes for each taxable year, beginning on and after January 1, 2017, and before January 1, 2023, to a taxpayer that donates qualified food, as defined, of its trade or business to an organization located in California and exempt from federal income taxation, as specified.

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:

P1    1

SECTION 1.  

The Legislature finds and declares the following:

P2    1(a) One out of every seven Californians does not know where
2his or her next meal will come from.

3(b) Two million three hundred thousand children in California
4are food insecure, with one in four children going to bed hungry
5each night.

6(c) Although CalFresh is the state’s most effective program to
7address hunger in the state, serving 4,500,000 Californians, the
8state’s federal waiver to the three-month time limit for the federal
9Able Bodied Adults Without Dependents in the Supplementary
10Nutrition Assistance Program, known in California as CalFresh,
11will expire in 2017. The expiration of the federal waiver is expected
12to increase demand on local direct service organizations serving
13food prepared for human consumption.

14(d) California has been a leader in public-private partnerships
15to reduce hunger. Examples of these partnerships include the
16CalFresh Restaurant Meals Program and the California Association
17of Food Banks’ Farm to Family program.

18(e) Given the growing need for hunger relief, restaurants and
19grocers are trying to find a better way to redirect excess food to
20the hungry, instead of landfills.

21

SEC. 2.  

Section 17053.90 is added to the Revenue and Taxation
22Code
, to read:

23

17053.90.  

(a) For taxable years beginning on or after January
241, 2017, and before January 1, 2023, in the case of a taxpayer that
25donates qualified food of its trade or business to an organization
26located in California that is exempt from federal income taxation
27as an organization described in Section 501(c)(3) of the Internal
28Revenue Code, there shall be allowed as a credit against the “net
29tax,” as defined in Section 17039, an amount equal to 10 percent
30of the fair market value of the contribution.

31(b) For purposes of this section, “qualified food” means
32prepackaged food, as defined in Section 113876 of Health and
33Safety Code, and food prepared for immediate human consumption,
34including unspoiled fruits and vegetables.

35(c) A deduction or credit shall not be allowed under this part
36for amounts taken into account under this section in calculating
37the credit allowed by this section.

38(d) In the case where the credit allowed under this section
39exceeds the net tax, the excess may be carried over to reduce the
P3    1net tax in the following year, and for the eight succeeding years,
2if necessary, until the credit has been exhausted.

3(e) This section shall be repealed on December 1, 2023.

4

SEC. 3.  

Section 23690 is added to the Revenue and Taxation
5Code
, to read:

6

23690.  

(a) For taxable years beginning on or after January 1,
72017, and before January 1, 2023, in the case of a taxpayer that
8donates qualified food from its trade or business to an organization
9located in California that is exempt from federal income taxation
10as an organization described in Section 501(c)(3) of the Internal
11Revenue Code, there shall be allowed as a credit against the “tax,”
12as defined in Section 23036, an amount equal to 15 percent of the
13fair market value of the contribution.

14(b) For purposes of this section, “qualified food” means
15prepackaged food, as defined in Section 113876 of Health and
16Safety Code, and food prepared for immediate human consumption,
17including unspoiled fruits and vegetables.

18(c) A deduction shall not be allowed under this part for amounts
19taken into account under this section in calculating the credit
20allowed by this section.

21(d) In the case where the credit allowed under this section
22exceeds the net tax, the excess may be carried over to reduce the
23net tax in the following year, and for the eight succeeding years,
24if necessary, until the credit has been exhausted.

25(e) This section shall be repealed on December 1, 2023.

26

SEC. 4.  

It is the intent of the Legislature to comply with Section
2741 of the Revenue and Taxation Code.

28

SEC. 5.  

This act provides for a tax levy within the meaning of
29Article IV of the Constitution and shall go into immediate effect.



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