SB 1103,
as amended, Cannella. begin deleteTaxation: end deletebegin insertPersonal income taxes: end insertrenters’ credit.
The Personal Income Tax Law authorizes various credits against the taxes imposed by that law, including a credit for qualified renters in the amount of $120 for married couples filing joint returns, heads of household, and surviving spouses if adjusted gross income is $50,000, as adjusted currently to $76,518, or less, and in the amount of $60 for other individuals if adjusted gross income is $25,000, as adjusted currently to $38,259, or less.
Thisbegin delete bill would,end deletebegin insert bill,end insert for taxable years beginning on and after January 1,begin delete 2017,end deletebegin insert
2016, instead wouldend insert increase this credit for a qualified renter tobegin delete $184end deletebegin insert $200end insert for married couples filing joint returns, heads of household, and surviving spouses,begin delete if adjusted gross income is $100,000 or less and to an amount equalend deletebegin insert andend insert tobegin delete $92end deletebegin insert $100end insert for otherbegin delete individuals whose adjusted gross income is $50,000 or less. The bill would require the Franchise Tax Board to annually adjust the adjusted gross income amounts for inflation, beginning January 1, 2018.end deletebegin insert
individuals.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:
begin insertSection 17053.5 of the end insertbegin insertRevenue and Taxation
2Codeend insertbegin insert is amended to read:end insert
(a) (1) For a qualified renter, there shall be allowed
4a credit against his or her “net tax,” as defined in Section 17039.
5The amount of the credit shall be as follows:
6(A) For married couples filing joint returns, heads of household,
7and surviving spouses, as defined in Section 17046, the credit shall
8be equal to one hundred twenty dollars ($120)begin insert for taxable years
9beginning before January 1, 2016, and two hundred dollars ($200)
10for taxable years beginning on or after January 1, 2016,end insert if adjusted
11gross income is fifty thousand dollars ($50,000) or less.
12(B) For other individuals, the credit shall be equal to sixty dollars
13($60)begin insert
for taxable years beginning before January 1, 2016, and one
14hundred dollars ($100) for taxable years beginning on or after
15January 1, 2016,end insert if adjusted gross income is twenty-five thousand
16dollars ($25,000) or less.
17(2) Except as provided in subdivision (b), a husband and wife
18shall receive but one credit under this section. If the husband and
19wife file separate returns, the credit may be taken by either or
20equally divided between them, except as follows:
21(A) If one spouse was a resident for the entire taxable year and
22the other spouse was a nonresident for part or all of the taxable
23year, the resident spouse shall be allowed one-half the credit
24allowed to married persons and the nonresident spouse shall be
25permitted one-half the credit allowed to married persons, prorated
26as provided in subdivision (e).
27(B) If both spouses were nonresidents for part of the taxable
28year, the credit allowed to married persons shall be divided equally
29between them subject to the proration provided in subdivision (e).
30(b) For a husband and wife, if each spouse maintained a separate
31place of residence and resided in this state during the entire taxable
32year, each spouse will be allowed one-half the full credit allowed
33to married persons provided in subdivision (a).
34(c) For purposes of this section, a “qualified renter” means an
35individual who satisfies both of the following:
36(1) Was a resident of this state, as defined in Section 17014.
P3 1(2) Rented and occupied premises in this state which constituted
2his or her
principal place of residence during at least 50 percent
3of the taxable year.
4(d) “Qualified renter” does not include any of the following:
5(1) An individual who for more than 50 percent of the taxable
6year rented and occupied premises that were exempt from property
7taxes, except that an individual, otherwise qualified, is deemed a
8qualified renter if he or she or his or her landlord pays possessory
9interest taxes, or the owner of those premises makes payments in
10lieu of property taxes that are substantially equivalent to property
11taxes paid on properties of comparable market value.
12(2) An individual whose principal place of residence for more
13than 50 percent of the taxable year is with another person who
14claimed that individual as a dependent for income tax purposes.
15(3) An individual who has been granted or whose spouse has
16been granted the homeowners’ property tax exemption during the
17taxable year. This paragraph does not apply to an individual whose
18spouse has been granted the homeowners’ property tax exemption
19if each spouse maintained a separate residence for the entire taxable
20year.
21(e) An otherwise qualified renter who is a nonresident for any
22portion of the taxable year shall claim the credits set forth in
23subdivision (a) at the rate of one-twelfth of those credits for each
24full month that individual resided within this state during the
25taxable year.
26(f) A person claiming the credit provided in this section shall,
27as part of that claim, and under penalty of perjury, furnish that
28information as the Franchise Tax Board prescribes on a form
29supplied by the board.
30(g) The credit provided in this section shall be claimed on returns
31in the form as the Franchise Tax Board may from time to time
32prescribe.
33(h) For purposes of this section, “premises” means a house or
34a dwelling unit used to provide living accommodations in a
35building or structure and the land incidental thereto, but does not
36include land only, unless the dwelling unit is a mobilehome. The
37credit is not allowed for any taxable year for the rental of land
38upon which a mobilehome is located if the mobilehome has been
39granted a homeowners’ exemption under Section 218 in that year.
P4 1(i) This section shall become operative on January 1, 1998, and
2applies to any taxable year beginning on or after January 1, 1998.
3(j) For each taxable year beginning on or after
January 1, 1999,
4the Franchise Tax Board shall recompute the adjusted gross income
5amounts set forth in subdivision (a). The computation shall be
6made as follows:
7(1) The Department of Industrial Relations shall transmit
8annually to the Franchise Tax Board the percentage change in the
9California Consumer Price Index for all items from June of the
10prior calendar year to June of the current year, no later than August
111 of the current calendar year.
12(2) The Franchise Tax Board shall compute an inflation
13adjustment factor by adding 100 percent to the portion of the
14percentage change figure which is furnished pursuant to paragraph
15(1) and dividing the result by 100.
16(3) The Franchise Tax Board shall multiply the amount in
17subparagraph (B) of paragraph (1) of subdivision (d) for the
18preceding taxable year by the inflation
adjustment factor
19determined in paragraph (2), and round off the resulting products
20to the nearest one dollar ($1).
21(4) In computing the amounts pursuant to this subdivision, the
22amounts provided in subparagraph (A) of paragraph (1) of
23subdivision (a) shall be twice the amount provided in subparagraph
24(B) of paragraph (1) of subdivision (a).
Section 17053.5 of the Revenue and Taxation
26Code is amended to read:
(a) (1) For a qualified renter, there shall be allowed
28a credit against his or her “net tax,” as defined in Section 17039.
29The amount of the credit shall be as follows:
30(A) For taxable years beginning before January 1, 2017:
31(i)
32For married couples filing joint returns, heads of household,
33and surviving spouses, as defined in Section 17046, the credit shall
34be equal to one hundred twenty dollars ($120) if adjusted gross
35income is fifty thousand dollars ($50,000) or less.
36(ii)
37For other individuals, the credit shall be equal to sixty dollars
38($60) if adjusted gross income is twenty-five thousand dollars
39($25,000) or less.
40(B) For taxable years beginning on or after January 1, 2017:
P5 1(i) For married couples filing joint returns, heads of household,
2and surviving spouses, as defined in Section 17046, the credit shall
3be equal to one hundred eighty-four dollars ($184) if
adjusted gross
4income is one hundred thousand dollars ($100,000) or less.
5(ii) For other individuals, the credit shall be equal to ninety-two
6dollars ($92) if adjusted gross income is fifty thousand dollars
7($50,000) or less.
8(2) Except as provided in subdivision (b), a husband and wife
9shall receive one credit under this section. If the husband and wife
10file separate returns, the credit may be taken by either or equally
11divided between them, except as follows:
12(A) If one spouse was a resident for the entire taxable year and
13the other spouse was a nonresident for part or all of the taxable
14year, the resident spouse shall be
allowed one-half the credit
15allowed to married persons and the nonresident spouse shall be
16permitted one-half the credit allowed to married persons, prorated
17as provided in subdivision (e).
18(B) If both spouses were nonresidents for part of the taxable
19year, the credit allowed to married persons shall be divided equally
20between them subject to the proration provided in subdivision (e).
21(b) For a husband and wife, if each spouse maintained a separate
22place of residence and resided in this state during the entire taxable
23year, each spouse will be allowed one-half the full credit allowed
24to married persons provided in subdivision (a).
25(c) For purposes of this section, a “qualified renter” means an
26individual who satisfies
both of the following:
27(1) Was a resident of this state, as defined in Section 17014.
28(2) Rented and occupied premises in this state which constituted
29his or her principal place of residence during at least 50 percent
30of the taxable year.
31(d) “Qualified renter” does not include any of the following:
32(1) An individual who for more than 50 percent of the taxable
33year rented and occupied premises that were exempt from property
34taxes, except that an individual, otherwise qualified, is deemed a
35qualified renter if he or she or his or her landlord pays possessory
36
interest taxes, or the owner of those premises makes payments in
37lieu of property taxes that are substantially equivalent to property
38taxes paid on properties of comparable market value.
P6 1(2) An individual whose principal place of residence for more
2than 50 percent of the taxable year is with any other person who
3claimed that individual as a dependent for income tax purposes.
4(3) An individual who has been granted or whose spouse has
5been granted the homeowners’ property tax exemption during the
6taxable year. This paragraph does not apply to an individual whose
7spouse has been granted the homeowners’ property tax exemption
8if each spouse maintained a separate residence for the entire taxable
9year.
10(e) An otherwise qualified renter who is a nonresident for any
11portion of the taxable year shall claim the credits set forth in
12subdivision (a) at the rate of one-twelfth of those credits for each
13full month that individual resided within this state during the
14taxable year.
15(f) A person claiming the credit provided in this section shall,
16as part of that claim, and under penalty of perjury, furnish that
17information as the Franchise Tax Board prescribes on a form
18supplied by the board.
19(g) The credit provided in this section shall be claimed on returns
20in the form as the Franchise Tax Board may from time to time
21prescribe.
22(h) For purposes of this section, “premises” means a house or
23a dwelling unit
used to provide living accommodations in a
24
building or structure and the land incidental thereto, but does not
25include land only, unless the dwelling unit is a mobilehome. The
26credit is not allowed for any taxable year for the rental of land
27upon which a mobilehome is located if the mobilehome has been
28granted a homeowners’ exemption under Section 218 in that year.
29(i) This section shall become operative on January 1, 1998, and
30applies to any taxable year beginning on or after January 1, 1998.
31(j) For each taxable year beginning on or after January 1, 1999,
32and before January 1, 2017, and for each taxable year beginning
33on or after January 1, 2018, the Franchise Tax Board shall
34recompute the adjusted gross income amounts set forth in
35
subparagraphs (A) and (B), respectively, of paragraph (1) of
36subdivision (a). The computation shall be made as follows:
37(1) The Department of Industrial Relations shall transmit
38annually to the Franchise Tax Board the percentage change in the
39California Consumer Price Index for all items from June of the
P7 1prior calendar year to June of the current year, no later than August
21 of the current calendar year.
3(2) The Franchise Tax Board shall compute an inflation
4adjustment factor by adding 100 percent to that portion of the
5percentage change figure furnished pursuant to paragraph (1) and
6dividing the result by 100.
7(3) The Franchise Tax Board shall multiply the amounts in
8paragraph (1) of subdivision
(a) for the preceding taxable year by
9the inflation adjustment factor determined in paragraph (2), and
10round off the resulting products to the nearest one dollar ($1).
11(4) (A) In computing the amounts pursuant to this subdivision,
12the amounts provided in clause (i) of subparagraph (A) of
13paragraph (1) of subdivision (a) shall be twice the amount provided
14in clause (ii) of subparagraph (A) of paragraph (1) of subdivision
15(a).
16(B) In computing the amounts pursuant to this subdivision, the
17amounts provided in clause (i) of subparagraph (B) of paragraph
18(1) of subdivision (a) shall be twice the amount provided in clause
19(ii) of subparagraph (B) of paragraph (1) of subdivision (a).
This act provides for a tax levy within the meaning of
21Article IV of the Constitution and shall go into immediate effect.
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