Amended in Assembly May 16, 2016

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 amended, 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:

P2    1

SECTION 1.  

The Legislature finds and declares the following:

2(a) One out of every seven Californians does not know where
3his or her next meal will come from.

4(b) Two million three hundred thousand children in California
5are food insecure, with one in four children going to bed hungry
6each night.

7(c) Although CalFresh is the state’s most effective program to
8address hunger in the state, serving 4,500,000 Californians, the
9state’s federal waiver to the three-month time limit for the federal
10Able Bodied Adults Without Dependents in the Supplementary
11Nutrition Assistance Program, known in California as CalFresh,
12will expire in 2017. The expiration of the federal waiver is expected
13to increase demand on local direct service organizations serving
14food prepared for human consumption.

15(d) California has been a leader in public-private partnerships
16to reduce hunger. Examples of these partnerships include the
17CalFresh Restaurant Meals Program and the California Association
18of Food Banks’ Farm to Family program.

19(e) Given the growing need for hunger relief, restaurants and
20grocers are trying to find a better way to redirect excess food to
21the hungry, instead of landfills.

22

SEC. 2.  

Section 17053.90 is added to the Revenue and Taxation
23Code
, to read:

24

17053.90.  

(a) For taxable years beginning on or after January
251, 2017, and before January 1, 2023, in the case of a taxpayer that
26donates qualified food of its trade or business to an organization
27located in California that is exempt from federal income taxation
28as an organization described in Section 501(c)(3) of the Internal
29Revenue Code, there shall be allowed as a credit against the “net
30tax,” as defined in Section 17039, an amount equal to 10 percent
31of the fair market value of the contribution.

32(b) For purposes of this section, “qualified food” means
33prepackaged food, as defined in Section 113876 of Health and
34Safety Code,begin delete andend deletebegin insert orend insert food prepared for immediate human
35consumption, including unspoiled fruits and vegetables.

36(c) A deduction or credit shall not be allowed under this part
37for amounts taken into account under this section in calculating
38the credit allowed by this section.

begin delete

P3    1(d) In the case where the credit allowed under this section
2exceeds the net tax, the excess may be carried over to reduce the
3net tax in the following year, and for the eight succeeding years,
4if necessary, until the credit has been exhausted.

end delete

5
begin insert(d)end insertbegin insertend insertbegin insertThe credit allowed by this section may be claimed only on
6a timely filed original return.end insert

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

8

SEC. 3.  

Section 23690 is added to the Revenue and Taxation
9Code
, to read:

10

23690.  

(a) For taxable years beginning on or after January 1,
112017, and before January 1, 2023, in the case of a taxpayer that
12donates qualified foodbegin delete fromend deletebegin insert ofend insert its trade or business to an
13organization located in California that is exempt from federal
14income taxation as an organization described in Section 501(c)(3)
15of the Internal Revenue Code, there shall be allowed as a credit
16against the “tax,” as defined in Section 23036, an amount equal
17tobegin delete 15end deletebegin insert 10end insert percent of the fair market value of the contribution.

18(b) For purposes of this section, “qualified food” means
19prepackaged food, as defined in Section 113876 of Health and
20Safety Code,begin delete andend deletebegin insert orend insert food prepared for immediate human
21consumption, including unspoiled fruits and vegetables.

22(c) A deductionbegin insert or creditend insert shall not be allowed under this part
23for amounts taken into account under this section in calculating
24the credit allowed by this section.

begin delete

25(d) In the case where the credit allowed under this section
26exceeds the net tax, the excess may be carried over to reduce the
27net tax in the following year, and for the eight succeeding years,
28if necessary, until the credit has been exhausted.

end delete

29
begin insert(d)end insertbegin insertend insertbegin insertThe credit allowed by this section may be claimed only on
30a timely filed original return.end insert

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

32

SEC. 4.  

It is the intent of the Legislature to comply with Section
3341 of the Revenue and Taxation Code.

34

SEC. 5.  

This act provides for a tax levy within the meaning of
35Article IV of the Constitution and shall go into immediate effect.



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