BILL NUMBER: AB 1974	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Dickinson
   (Coauthor: Assembly Member Allen)

                        FEBRUARY 23, 2012

   An act to add Section 17052.1 to the Revenue and Taxation Code,
relating to taxation, and making an appropriation therefor.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1974, as introduced, Dickinson. Income taxes: credit: earned
income.
   The Personal Income Tax Law authorizes various credits against the
taxes imposed by that law, including certain credits that are
allowed in modified conformity to credits allowed by federal income
tax laws.
   This bill would, for taxable years beginning on or after January
1, 2013, allow a credit computed by multiplying the federal credit
amount, as defined, by 15% and subtracting therefrom the alternative
minimum tax, as specified. This bill would provide that the credit
would be refundable.
   The Tax Relief and Refund Account in the General Fund is
continuously appropriated to make all payments required to be made to
taxpayers or other persons, as specified.
   By authorizing a new, refundable income tax credit to be paid from
that account, this bill would make an appropriation.
   Vote: 2/3. Appropriation: yes. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 17052.1 is added to the Revenue and Taxation
Code, to read:
   17052.1.  (a) For each taxable year beginning on or after January
1, 2013, there shall be allowed as a credit against the "net tax," as
defined by Section 17039, an amount determined under subdivision
(b).
   (b) Except as otherwise provided in this section, the amount of
the credit allowed under subdivision (a) shall be computed by
multiplying the "federal credit amount," as defined in subdivision
(c), by 15 percent and subtracting therefrom the amount of tax
imposed by Section 17062, relating to the alternative minimum tax, if
any, for the same taxable year.
   (c) For purposes of this section, "federal credit amount" means
the amount determined under Section 32 of the Internal Revenue Code
as in effect on January 1, 2012.
   (d) A credit shall not be allowed under this section to any of the
following:
   (1) Any person who is a nonresident for any portion of the taxable
year.
   (2)  Any person who is married, within the meaning of Section
17021.5, and files a separate return for the taxable year.
   (e) If the amount allowable as a credit under this section exceeds
the tax liability computed under this part, the excess shall be
credited against other amounts due, if any, and the balance, if any,
shall be paid from the Tax Relief and Refund Account and refunded to
the taxpayer.
   (f) Any credit refunded to a taxpayer pursuant to this section
shall not be included in income subject to tax under this part.
   (g) Notwithstanding any other state law, and to the extent
permitted by federal law, amounts refunded pursuant to subdivision
(e) shall be treated the same as the federal credit defined in
subdivision (c) for the purpose of determining eligibility to receive
benefits under Division 9 (commencing with Section 10000) of the
Welfare and Institutions Code or amounts of those benefits.