SB 1376, as introduced, Gaines. Personal income taxes: credit: health care coverage.
The Personal Income Tax Law allow various credits against the taxes imposed by that law.
This bill, for taxable years beginning on or after January 1, 2014, and before January 1, 2016, would allow a credit equal to 50% of the annual premium amount paid or incurred for an individual health care service plan contract or individual policy of health insurance during the taxable year by a qualified taxpayer, which is defined as an individual whose individual health care service plan contract or individual policy of health insurance was canceled between December 31, 2013, and December 31, 2014, inclusive, and, with respect to the purchase of a new individual plan contract or policy, the individual was not eligible for a federal subsidy or a federal health care tax credit, as specified.
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 17054.6 is added to the Revenue and
2Taxation Code, to read:
(a) For each taxable year beginning on or after
2January 1, 2014, and before January 1, 2016, there shall be allowed
3as a credit against the “net tax,” as defined in Section 17039, an
4amount equal to 50 percent of the annual premium amount paid
5or incurred during the taxable year by a qualified taxpayer for an
6individual health care service plan contract or individual policy of
7health insurance.
8(b) For the purposes of this section, the following definitions
9shall apply:
10(1) “Individual health care service plan contract” means a plan
11contract, as defined in Section 1345 of the Health and Safety Code,
12issued to an individual.
13(2) “Individual policy of health insurance” means a policy issued
14to an individual for health insurance, as defined in Section 106 of
15the Insurance Code.
16(3) “Qualified taxpayer” means an individual, including an
17individual with dependents, whose individual health care service
18plan contract or individual policy of health insurance was canceled
19between December 31, 2013, and December 31, 2014, inclusive,
20pursuant to paragraph (5) or (6) of subdivision (a) of Section 1365
21of the Health and Safety Code, or subdivision (d) or (e) of Section
2210273.6 of the Insurance Code and, with respect to the purchase
23of a new individual plan contract or policy, the individual was not
24eligible for a federal subsidy for reduced cost sharing for
25individuals enrolling in qualified health plans as described in
26Section 18071 of Title 42 of the United States Code or a federal
27health care tax credit as described
in Section 36B of Title 26 of
28the Internal Revenue Code.
29(c) In the case where the credit allowed by this section exceeds
30the “net tax,” the excess may be carried over to reduce the “net
31tax” in the following year, and succeeding seven years if necessary,
32until the credit is exhausted.
33(d) A deduction otherwise allowed under this part for any
34amount paid or incurred by the qualified taxpayer upon which the
35credit is based shall be reduced by the amount of the credit allowed
36by this section.
37(e) Credit under this section shall be allowed only for credits
38claimed on a timely filed original return of the qualified taxpayer.
P3 1(f) (1) The Franchise Tax Board may prescribe rules, guidelines,
2or procedures necessary or appropriate to carry out the purposes
3of
this section.
4(2) Chapter 3.5 (commencing with Section 11340) of Part 1 of
5Division 3 of Title 2 of the Government Code does not apply to
6any standard, criterion, procedure, determination, rule, notice, or
7guideline established or issued by the Franchise Tax Board
8pursuant to this section.
9(g) This section shall be repealed on December 1, 2016.
This act provides for a tax levy within the meaning of
11Article IV of the Constitution and shall go into immediate effect.
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