Amended in Assembly January 6, 2014

Amended in Assembly April 29, 2013

Amended in Assembly March 19, 2013

California Legislature—2013–14 Regular Session

Assembly Bill No. 43

Introduced by Assembly Member Bocanegra

December 14, 2012

begin delete An act to amend Section 17052.25 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy. end delete begin insert An act to amend Section 6901 of the Revenue and Taxation Code, relating to taxation. end insert

LEGISLATIVE COUNSEL’S DIGEST

AB 43, as amended, Bocanegra. begin delete Income taxes: credits: adoption costs. end delete begin insert Sales and use taxes: claim for refund: customer refunds. end insert

begin insert

Under the Sales and Use Tax Law, any amount collected or paid in excess of what is due under that law is required to be credited by the State Board of Equalization against any other amounts due and payable from the person from whom the excess amount was collected or by whom it was paid, and the balance refunded to the person, as provided. Under existing law, when an amount represented by a person to a customer as constituting reimbursement for taxes due under the Sales and Use Tax Law is computed upon an amount that is not taxable or is in excess of the taxable amount and is actually paid by the customer to the person, the amount paid is required to be returned by the person to the customer upon notification by the board or by the customer that this excess has been ascertained.

end insert begin insert

This bill would authorize a person to make an irrevocable election to assign to the customer the right to receive the amount that would be refunded to the person, provided specified conditions are met, including that the amount be $50,000 or greater, and would authorize the board to make that payment to the customer.

end insert begin delete

The Personal Income Tax Law authorizes various credits against the taxes imposed by that law, including a credit in an amount equal to 50% of specified adoption costs, not to exceed $2,500 per minor child.

end delete begin delete

This bill would increase the maximum amount of the above credit to $3,000, commencing January 1, 2014.

end delete begin delete

This bill would take effect immediately as a tax levy.

end delete

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

begin insert

begin insert SECTION 1. end insert   

end insert

begin insert Section 6901 of the end insert begin insert Revenue and Taxation Code end insert
begin insert is amended to read: end insert

6901.  

begin insert (a) end insert begin insert   end insert If the board determines that any amount, penalty,
or interest has been paid more than once or has been erroneously
or illegally collected or computed, the board shall set forth that
fact in the records of the board and shall certify the amount
collected in excess of the amount legally due and the person from
whom it was collected or by whom paid. The excess amount
collected or paid shall be credited by the board on any amounts
then due and payable from the person from whom the excess
amount was collected or by whom it was paid under this part, and
the balance shall be refunded to the person, or his or her successors,
administrators, or executors, begin insert or customer as provided in subdivision
(b), end insert if a determination by the board is made in any of the following
cases:

begin delete

(a)

end delete

begin insert (1) end insert  Any amount of tax, interest, or penalty was not required to
be paid.

begin delete

(b)

end delete

begin insert (2) end insert  Any amount of prepayment of sales tax, interest, or penalty
paid pursuant to Article 1.5 (commencing with Section 6480) of
Chapter 5 was not required to be paid.

begin delete

(c)

end delete

begin insert (3) end insert  Any amount that is approved as a settlement pursuant to
Section 7093.5.

begin insert

(b) A person may make an irrevocable election to assign to the
customer the right to receive the amount refunded if all of the
following conditions are met:

end insert begin insert

(1) The entire amount represents excess tax reimbursement that
is required to be paid by the person to a single customer under
Section 6901.5.

end insert begin insert

(2) The amount to be refunded is fifty thousand dollars ($50,000)
or greater.

end insert begin insert

(3) The irrevocable election to assign to the customer the amount
refunded is evidenced by a statement signed by the person and the
customer authorizing the named customer to receive the amount
refunded.

end insert begin insert

(4) The signed statement is submitted to the board in conjunction
with the person’s claim for refund.

end insert begin delete

Any

end delete

begin insert (c) end insert begin insert   end insert begin insert Any end insert overpayment of the use tax by a purchaser to a retailer
who is required to collect the tax and who gives the purchaser a
receipt therefor pursuant to Article 1 (commencing with Section
6201) of Chapter 3 shall be credited or refunded by the state to the
purchaser. begin delete Any proposed determination by the board pursuant to
this section with respect to an amount in excess of fifty thousand
dollars ($50,000) shall be available as a public record for at least
10 days prior to the effective date of that determination. end delete

begin insert

(d) Any proposed determination by the board pursuant to this
section with respect to an amount in excess of fifty thousand dollars
($50,000) shall be available as a public record for at least 10 days
prior to the effective date of that determination.

end insert

begin delete

SECTION 1.  

Section 17052.25 of the Revenue and Taxation
Code is amended to read:

17052.25.  

(a) For each taxable year beginning on or after
January 1, 1994, there shall be allowed as a credit against the “net
tax,” as defined in Section 17039, an amount equal to 50 percent
of the costs paid or incurred by a taxpayer for the adoption of any
minor child who is a citizen or legal resident of the United States
and was in the custody of a public agency of either this state or a
political subdivision of this state.

(1)  For each taxable year beginning on or after January 1, 1994,
and before January 1, 2014, the credit shall not exceed two
thousand five hundred dollars ($2,500) per minor child.

(2) For each taxable year beginning on or after January 1, 2014,
the credit shall not exceed three thousand dollars ($3,000) per
minor child.

(b) “Costs” eligible for the credit pursuant to subdivision (a)
shall include the following:

(1) Fees for required services of either the Department of Social
Services or a licensed adoption agency.

(2) Travel and related expenses for the adoptive family that are
directly related to the adoption process.

(3) Medical fees and expenses that are not reimbursed by
insurance and are directly related to the adoption process.

(c) The credit authorized by this section shall be claimed for
the taxable year in which the decree or order of adoption is entered
pursuant to Section 8612 of the Family Code. However, the
allowable credit claimed may include any costs of that adoption
paid or incurred in any prior taxable year.

(d) In the case where the credit allowed by 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 total credit of two thousand five hundred dollars ($2,500), or
commencing January 1, 2014, three thousand dollars ($3,000), per
minor child is exhausted.

(e) Any deduction otherwise allowed under this part for any
amount paid or incurred by the taxpayer upon which the credit is
based shall be reduced by the amount of the credit allowed under
this section.

SEC. 2.  

This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.

end delete