Bill Text: CA AB1863 | 2017-2018 | Regular Session | Enrolled
Bill Title: Personal income tax: deduction: commercial cannabis activity.
Spectrum: Moderate Partisan Bill (Democrat 4-1)
Status: (Vetoed) 2018-09-19 - Vetoed by Governor. [AB1863 Detail]
Download: California-2017-AB1863-Enrolled.html
|
Enrolled
August 23, 2018 |
|
Passed
IN
Senate
August 21, 2018 |
|
Passed
IN
Assembly
May 29, 2018 |
|
Amended
IN
Assembly
May 08, 2018 |
|
Amended
IN
Assembly
April 17, 2018 |
CALIFORNIA LEGISLATURE—
2017–2018 REGULAR SESSION
| Assembly Bill | No. 1863 |
| Introduced by Assembly Members Jones-Sawyer, Bonta, Cooley, Lackey, and Wood |
January 11, 2018 |
An act to add Section 17209 to the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.
LEGISLATIVE COUNSEL'S DIGEST
AB 1863, Jones-Sawyer.
Personal income tax: deduction: commercial cannabis activity.
Existing law, the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA), among other things, consolidates the licensure and regulation of commercial medicinal and adult-use cannabis activities and authorizes persons to conduct specified commercial cannabis activities, as defined, in the state.
The Personal Income Tax Law and the Corporation Tax Law allow various deductions in computing the income that is subject to the taxes imposed by those laws. The Personal Income Tax Law conforms as of a specified date to federal income tax laws with respect to itemized deductions, including business deductions and items not deductible, except as specifically provided. The Corporation Tax Law does not conform to those federal income tax provisions, but specifically provides for deductions for purposes of that law. The Personal Income Tax
Law, by conformity to federal income tax laws, disallows a deduction or credit for business expenses of a trade or business whose activities consist of trafficking specified controlled substances, including marijuana.
This bill, for each taxable year beginning on and after January 1, 2018, would specifically provide in the Personal Income Tax Law for nonconformity to that federal law disallowing a deduction or credit for business expenses of a trade or business whose activities consist of trafficking specified controlled substances, only for commercial cannabis activity, as defined under MAUCRSA, by a licensee under MAUCRSA, thus allowing deduction of business expenses for a cannabis trade or business under the Personal Income Tax Law, as provided.
This bill would take effect immediately as a tax levy.
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NOBill Text
The people of the State of California do enact as follows:
SECTION 1.
Section 17209 is added to the Revenue and Taxation Code, to read:17209.
(a) For each taxable year beginning on or after January 1, 2018, Section 280E of the Internal Revenue Code, relating to expenditures in connection with the illegal sale of drugs, shall not apply to the carrying on of any trade or business that is commercial cannabis activity by a licensee.(b) For purposes of this section, “commercial cannabis activity” and “licensee” shall have the same meanings as set forth in Division 10 (commencing with Section 26000) of the Business and Professions Code.
