BILL NUMBER: AB 340 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MARCH 24, 2009
INTRODUCED BY Assembly Member Knight
FEBRUARY 18, 2009
An act to add Sections 17053.80 and 23623 to the Revenue and
Taxation Code, relating to taxation, to take effect immediately, tax
levy.
LEGISLATIVE COUNSEL'S DIGEST
AB 340, as amended, Knight. Income taxes: credits: hiring credit.
The Personal Income Tax Law and the Bank and Corporation Tax Law
authorize various credits against the taxes imposed by those laws.
This bill would, u nder both laws, for
taxable years beginning on and after January 1, 2009, authorize a
credit to a qualified taxpayer equal to 5% of the wages of
all employer of either $3,000 or $5,000, as specified,
for each qualified employees employee
, as defined, employed by the qualified taxpayer
employer during the taxable year.
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:
SECTION 1. Section 17053.80 is added to the Revenue and Taxation
Code, to read:
17053.80. (a) (1) For each taxable year
beginning on or after January 1, 2009, there shall be allowed as
a credit against the "net tax," as defined in Section 17039,
equal to 5 percent of the wages of all an
amount as specified in paragraph (2) per each qualified
employees employee employed during the
taxable year by a qualified employer.
(2) The credit allowed by paragraph (1) shall be equal to three
thousand dollars ($3,000), or if the wage of the qualified employee
for which a tax credit authorized pursuant to this section is claimed
is 200 percent or more than the average wage in the county in which
the qualified employee is located, five thousand dollars ($5,000).
(b) For purposes of this section, "qualified employee" means an
employee who is employed by the taxpayer and is a resident of
California.
(c) In the case where the credit allowed under this section
exceeds the "net tax," the excess may be carried over to reduce the
"net tax" in the following year, and succeeding years if necessary,
until the credit has been exhausted.
(d) Any deduction otherwise allowed under this part for qualified
wages shall not be reduced by the amount of the credit allowed under
this section.
(e) For purposes of this section:
(1) (A) All employees of all corporations that are members of the
same
(b) For purposes of this section:
(1) "Headquarters" means the principal central administrative
office in California of a qualified employer that employs 30 or more
qualified employees at that office.
(2) "Qualified employee" means an employee who is a resident of
California that is employed by the qualified employer on a qualified
job.
(3) "Qualified employer" means a taxpayer that is a person engaged
in a trade or business within California that has either established
a headquarters within California or relocated a headquarters to
California.
(4) "Qualified job" means employment located at the qualified
employer's headquarters that is full-time employment, as defined by
law and regulation, and that pays wages that equal or exceed the
average wage in the county in which the headquarters are located.
(5) (A) An
employee of a corporation that is a member of a controlled
group of corporations shall be treated as employed by a single
taxpayer.
(B) For purposes of this paragraph, "controlled group of
corporations" has the same meaning as provided in Section 1563(a) of
the Internal Revenue Code, except that both of the following apply:
(i) "More than 50 percent" shall be substituted for "at least 80
percent" each place it appears in Section 1563(a)(1) of the Internal
Revenue Code.
(ii) Sections 1563(a)(4) and 1563(e)(3)(C) of the Internal Revenue
Code shall not apply.
(2)
(6) The Franchise Tax Board may prescribe appropriate
regulations to carry out the purposes of this paragraph
section , including any regulations necessary to
avoid the application of this paragraph through split-ups, shell
corporations, partnerships, tiered ownership structures, or
otherwise.
(c) The credit authorized by this section shall be available to a
qualified employer for the first taxable year in which the qualified
employer's headquarters are established within, or relocated to,
California, and the succeeding taxable year.
(d) In the case where the credit allowed under this section
exceeds the "net tax," the excess may be carried over to reduce the
"net tax" in the following year, and the succeeding 10 years if
necessary, until the credit has been exhausted.
(e) Any deduction otherwise allowed under this part for qualified
wages shall not be reduced by the amount of the credit allowed under
this section.
SEC. 2. Section 23623 is added to the Revenue and Taxation Code,
to read:
23623. (a) (1) For each taxable year
beginning on or after January 1, 2009, there shall be allowed as
a credit against the "tax," as defined in Section 23036,
of 5 percent of the wages of a an amount as
specified in paragraph (2) per each qualified employee employed
during the taxable year by a qualified employer.
(2) The credit allowed by paragraph (1) shall not be equal to
three thousand dollars ($3,000) or, if the average wage of the
qualified employee for which a tax credit authorized pursuant to this
section is claimed is 200 percent or more than the average wage in
the county in which the qualified employee is located, five thousand
dollars ($5,000).
(b) For purposes of this section, "qualified employee" means an
employee who is employed by the taxpayer and is a resident of
California.
(c) In the case where the credit allowed under this section
exceeds the "tax," the excess may be carried over to reduce the "tax"
in the following year, and succeeding years if necessary, until the
credit has been exhausted.
(d) Any deduction otherwise allowed under this part for qualified
wages shall not be reduced by the amount of the credit allowed under
this section.
(e) For purposes of this section:
(1) (A) All employees of all corporations that are members of the
same
(b) For purposes of this section:
(1) "Headquarters" means the principal central administrative
office in California of a qualified employer that employs 30 or more
qualified employees at that office.
(2) "Qualified employee" means an employee who is a resident of
California that is employed by the qualified employer on a qualified
job.
(3) "Qualified employer" means a taxpayer that is a person engaged
in a trade or business within California that has either established
its headquarters within California or relocated its headquarters to
California.
(4) "Qualified job" means employment located at the qualified
employer's headquarters that is full-time employment, as defined by
law and regulation, and that pays wages that equal or exceed the
average wage of the county in which the headquarters are located.
(5) (A) An
employee of a corporation that is a member of a controlled
group of corporations shall be treated as employed by a single
taxpayer.
(B) For purposes of this paragraph, "controlled group of
corporations" has the same meaning as provided in Section 1563(a) of
the Internal Revenue Code, except that both of the following apply:
(i) "More than 50 percent" shall be substituted for "at least 80
percent" each place it appears in Section 1563(a)(1) of the Internal
Revenue Code.
(ii) Sections 1563(a)(4) and 1563(e)(3)(C) of the Internal Revenue
Code shall not apply.
(2)
(6) The Franchise Tax Board may prescribe appropriate
regulations to carry out the purposes of this paragraph
section , including any regulations necessary to
avoid the application of this paragraph through split-ups, shell
corporations, partnerships, tiered ownership structures, or
otherwise.
(c) The credit authorized by this section shall be available to a
qualified employer for the first taxable year in which the qualified
employer's headquarters are established within, or relocated to,
California, and the succeeding taxable year.
(d) In the case where the credit allowed under this section
exceeds the "tax," the excess may be carried over to reduce the "tax"
in the following year, and the succeeding 10 years if necessary,
until the credit has been exhausted.
(e) Any deduction otherwise allowed under this part for qualified
wages shall not be reduced by the amount of the credit allowed under
this section.
SEC. 3. This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.