BILL ANALYSIS
SENATE REVENUE & TAXATION COMMITTEE
Senator Gilbert Cedillo, Chair
AB 132 - Chavez
Amended: April 21, 2003
Hearing: June 11, 2003 Fiscal: Yes
SUBJECT: Provides ordering rules to be used by the FTB
when adding income tax check-offs to the personal
income tax return.
EXISTING LAW
Allows taxpayers to contribute money to one or more of 11
voluntary contribution funds by checking a box on their
state income tax return. California law requires
contributions made through check-offs to be made from
taxpayers' own resources (not from their tax liability, as
is possible on federal tax returns). Check-off amounts may
be claimed as charitable contributions on taxpayers' tax
returns during the subsequent year.
Allows the FTB to design tax returns to provide for the
designation of contributions to specified funds either on
the return itself or on a separate schedule that must be
attached to the return.
THIS BILL
Provides ordering rules to be used by the FTB when adding a
check off to the income tax form.
Relates to "contingent check-offs" defined as income tax
check-offs that are approved for addition to the personal
income tax return upon the removal of another income tax
check-off from the return.
States that if the number of contingent check-offs approved
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for addition to the tax return in a taxable year is greater
than the number of income tax check-offs that are removed
from the return in that year, FTB shall add the contingent
check-offs in the order in which they were enacted. If two
or more contingent check-offs are enacted on the same date,
FTB shall add them in chapter number order.
Provides that notwithstanding the aforementioned rule, FTB
may add one or more approved contingent check-offs to the
income tax return if the department determines that space
is available to do so.
FISCAL EFFECT:
According to FTB, there is no revenue effect associated
with this measure.
COMMENTS:
A. Purpose of the bill
This bill is sponsored by the author. It is intended to do
two things: 1) allow FTB to add contingent income tax
check-offs to the return if there is room to do so,
regardless of how many check-offs were removed from the
return that year, and 2) clarify the ordering rules that
should be used by FTB when adding contingent check-offs to
the return.
B. Background
Concerns arose in the late 1990s that California was in
danger of expanding to a three-page tax form in order to
accommodate a proliferation of income tax check-offs.
To date, FTB has been able to add each approved contingent
check-off to the return in the first year the check-offs
have been eligible to be added. However, existing law does
not provide FTB with flexibility to add a contingent
check-off if there is room to do so; instead, the language
requires another check-off to be removed from the return
before a contingent check-off may be added. This bill
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provides FTB with needed flexibility.
Furthermore, existing law is unclear regarding the ordering
rules to be used by FTB when adding contingent checkoffs to
the income tax return. This bill requires FTB to use
chapter order number when determining the order in which
checkoffs are added.
C. 2002 Income Tax Return Check-Offs
There are currently 11 check-offs on the income tax form;
there is room for a total of 12 check off items on the
return. The check-offs are as follows:
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| | | | | |
|VOLUNTARY CONTRIBUTION |Initial|Final |Sunset |Must Meet |
|FUNDS | Tax |Tax |Date |$250,000 |
| |Return |Return | |test - |
| | | | |Inflation |
| | | | |Year |
| | | | | |
|------------------------+-------+---------+----------+-------------|
| | | | | |
|CA Fund For Senior |1983 |2004 |01/01/2005|Yes - 2002 |
|Citizens | | | | |
| | | | | |
|------------------------+-------+---------+----------+-------------|
| | | | | |
|Fish and Game |1983 |2007 |01/01/2008|Yes -2003 |
|Preservation Fund | | | | |
| | | | | |
|------------------------+-------+---------+----------+-------------|
| | | | | |
|State Children's Trust |1983 |2007 |01/01/2008|Yes - 2003 |
|Fund | | | | |
| | | | | |
|------------------------+-------+---------+----------+-------------|
| | | | | |
|CA Alzheimer's Disease |1987 |2004 |01/01/2005|Yes - 1992 |
|and Related Research | | | | |
|Fund | | | | |
| | | | | |
|------------------------+-------+---------+----------+-------------|
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| | | | | |
|CA Seniors Special Fund |1990 |No |None |No - None |
| | |Sunset | | |
| | | | | |
|------------------------+-------+---------+----------+-------------|
| | | | | |
|CA Breast Cancer |1992 |2007 |01/01/2008|Yes - 1997 |
|Research Fund | | | | |
| | | | | |
|------------------------+-------+---------+----------+-------------|
| | | | | |
|CA Firefighters' |1993 |2005 |01/01/2006|Yes* - None |
|Memorial Fund | | | | |
| | | | | |
|------------------------+-------+---------+----------+-------------|
| | | | | |
|Emergency Food |1998 |2003 |01/01/2004|Yes - 1999 |
|Assistance Program Fund | | | | |
| | | | | |
| | | | | |
|------------------------+-------+---------+----------+-------------|
| | | | | |
|California Peace |1999 |2005 |01/01/2006|Yes* - 2001 |
|Officer Foundation | | | | |
|Memorial Fund | | | | |
| | | | | |
|------------------------+-------+---------+----------+-------------|
| | | | | |
|Lupus Foundation of |2001 |2005 |01/01/2006|Yes - 2004 |
|America, CA Chapters | | | | |
|Fund | | | | |
| | | | | |
|------------------------+-------+---------+----------+-------------|
| | | | | |
|Asthma & Lung Disease & |2002** |2006 |01/01/2007|Yes -2005 |
|Research | | | | |
| | | | | |
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Support and Opposition
None reported.
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Consultant: Gayle Miller
AB 132-Chavez
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