BILL NUMBER: AB 340 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MAY 12, 2009
AMENDED IN ASSEMBLY MARCH 24, 2009
INTRODUCED BY Assembly Member Knight
FEBRUARY 18, 2009
An act to add and repeal Sections 17053.80 and
23623 to 17053.81 and 23623.2 of 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, under both laws, for taxable years beginning on
and after January 1, 2009, and before January 1, 2013,
authorize a credit to a qualified employer of either $3,000 or
$5,000, as specified, for each qualified employee, as defined,
employed by the qualified 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 17053.81
is added to the Revenue and Taxation Code, to read:
17053.80. 17053.81. (a) (1) For
each taxable year beginning on or after January 1, 2009, and
before January 1, 2013, there shall be allowed as a credit
against the "net tax," as defined in Section 17039, 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 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 completes a
majority, or at least 50 percent, of his or her work , five
thousand dollars ($5,000).
(b) For purposes of this section:
(1) "Average wage" means the wage average of each county, as
determined by the Employment Development Department.
(1) "Headquarters" means the principal central
(2) "Headquarters" means the principal
dministrative 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 employee" means an employee who was paid qualified
wages by the qualified employer for services rendered for not less
than an average of 35 hours per week.
(3)
(4) "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 , and, as of the last day of the
preceding taxable year, employed a total of 30 or more employees
.
(4)
(5) "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.
(6) "Qualified wages" means the amount of wages subject to Chapter
6 (commencing with Section 13000) of Part 6 of Division 6 of the
Unemployment Insurance Code.
(5)
(7) (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.
(6)
(8) The Franchise Tax Board may prescribe appropriate
regulations to carry out the purposes of this section, including any
regulations necessary to avoid the application of this
paragraph prevent the avoidance of the purposes of
this section through split-ups, shell corporations,
partnerships, tiered ownership structures, or otherwise.
(c) The credit authorized by this section shall be
available allowable 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.
(e) The credit allowed by this section shall be in lieu of any
other credit or deduction that the taxpayer may otherwise claim
pursuant to this part with respect to qualified wages.
(f) This section shall remain in effect only until December 1,
2013, and as of that date is repealed.
SEC. 2. Section 23623 23623.2 is
added to the Revenue and Taxation Code, to read:
23623. 23623.2. (a) (1) For each
taxable year beginning on or after January 1, 2009, and before
January 1, 2013, there shall be allowed as a credit against the
"tax," as defined in Section 23036, 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 completes a majority, or at least
50 percent, of his or her work , five thousand dollars
($5,000).
(b) For purposes of this section:
(1) "Average wage" means the wage average of each county, as
determined by the Employment Development Department.
(1) "Headquarters" means the principal central
(2) "Headquarters" means the principal
dministrative 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 employee" means an employee who was paid qualified
wages by the qualified employer for services rendered for not less
than an average of 35 hours per week.
(3)
(4) "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 , and, as of the last day of the
preceding taxable year, employed a total of 30 or more employees
.
(4)
(5) "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.
(6) "Qualified wages" means the amount of wages subject to Chapter
6 (commencing with Section 13000) of Part 6 of Division 6 of the
Unemployment Insurance Code.
(5)
(7) (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.
(6)
(8) The Franchise Tax Board may prescribe appropriate
regulations to carry out the purposes of this section, including any
regulations necessary to avoid the application of this
paragraph prevent the avoidance of the purposes of
this section through split-ups, shell corporations,
partnerships, tiered ownership structures, or otherwise.
(c) The credit authorized by this section shall be
available allowable 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.
(e) The credit allowed by this section shall be in lieu of any
other credit or deduction that the taxpayer may otherwise claim
pursuant to this part with respect to qualified wages.
(f) This section shall remain in effect only until December 1,
2013, and as of that date is repealed.
SEC. 3. This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.