BILL ANALYSIS
AB 1799
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Date of Hearing: April 21, 2004
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Judy Chu, Chair
AB 1799 (Mullin) - As Amended: April 12, 2004
Policy Committee: Revenue and
Taxation Vote: 7-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill extends the sunset date on the California Alzheimer's
Disease and Related Disorders Research Fund income tax checkoff
from January 1, 2005 to January 1, 2010,
FISCAL EFFECT
The Franchise Tax Board (FTB) estimates that extending the
sunset date of this checkoff will result in annual revenue
losses of approximately $32,000 per year, beginning in fiscal
year 2005-06.
COMMENTS
1)Background . Current 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 checkoffs to be made from
taxpayers' own resources (not from their tax liability, as is
possible on federal tax returns). Checkoff amounts may be
claimed as charitable contributions on taxpayers' tax returns
during the subsequent year.
To address the concern that a proliferation of income tax
checkoffs will cause California's personal income tax form to
grow to three pages, at considerable cost to the state,
Assembly committees require all checkoff bills to include a
sunset date, a $250,000 minimum contribution requirement
indexed for inflation, and "queuing language" to ensure that
any new checkoff is not added to the tax form until an
existing checkoff is removed. This bill is consistent with
AB 1799
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committee policy.
2)Purpose . This bill is intended to allow the California
Alzheimer's Disease and Related Disorders Research Fund to
remain on the income tax form beyond the 2004 tax year. This
income tax checkoff fund provides money for research grants
related to the care, treatment, and the cure of Alzheimer's
disease. The Alzheimer's checkoff is typically one of the more
popular checkoffs on California's tax form. In 2002-03, the
last fiscal year for which contribution information is
available, the Alzheimer's checkoff received approximately
$544,000 in contributions, fourth highest among the eleven
checkoffs on the return.
3)Legislation to Reform Checkoff System . SB 1736 (Bowen) would
replace the existing voluntary check-off system with a process
that would allow any qualified 501(c)3 organization that meets
the objective criteria specified in the bill to be listed in
the Franchise Tax Board's (FTB) tax information booklet.
Taxpayers who want to direct part of their refund to charity
would fill in the corresponding charity code number and the
amount you want to contribute here in a blank space that would
replace the existing checkoff.
Analysis Prepared by : Stephen Shea / APPR. / (916) 319-2081