BILL NUMBER: AB 2080 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Member Donnelly
FEBRUARY 20, 2014
An act to amend Sections 17215.1, 17551, 18631, 18663, and 19183
of, and to add Sections 17131.8 and 17131.15 to, the Revenue and
Taxation Code, and to amend Sections 940, 13009, and 13009.5 of, and
to amend and repeal Sections 927, 987.7, 13027, and 13055 of, the
Unemployment Insurance Code, relating to taxation.
LEGISLATIVE COUNSEL'S DIGEST
AB 2080, as introduced, Donnelly. Personal income taxes:
unemployment insurance: tips.
The Personal Income Tax Law, in modified conformity with federal
law, provides various exclusions from gross income in computing tax
liability. Existing law requires employers to make specified payments
and withholdings from wages paid for employment to, and to file
reports of wages and make contributions for unemployment insurance
and the employment training tax with, the Employment Development
Department, which is charged with administering the state's payroll
taxes.
This bill would, for taxable years beginning on or after January
1, 2015, exclude tips, as defined, from gross income for the purposes
of the Personal Income Tax Law. This bill also would exclude tips
from the definition of wages paid for employment for the purposes of
income tax withholding and for purposes of unemployment insurance and
the employment training tax. This bill would also make related
changes to other provisions.
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 17131.8 is added to the Revenue and Taxation
Code, to read:
17131.8. Section 102(a) of the Internal Revenue Code is modified
to treat tips as property transferred by gift.
SEC. 2. Section 17131.15 is added to the Revenue and Taxation
Code, to read:
17131.15. (a) For taxable years beginning on or after January 1,
2015, gross income does not include tips.
(b) "Tips" includes any gratuity provided by a customer or client
of the employer's business.
SEC. 3. Section 17215.1 of the Revenue and Taxation Code is
amended to read:
17215.1. (a) Section 220(f)(5) of the
Internal Revenue Code, relating to rollover contributions, shall not
apply.
(b) For taxable years on or after January 1, 2015, Section 220(b)
(4)(A) of the Internal Revenue Code is modified to strike out "tips."
SEC. 4. Section 17551 of the Revenue and Taxation Code is amended
to read:
17551. (a) Subchapter E of Chapter 1 of Subtitle A of the
Internal Revenue Code, relating to accounting periods and methods of
accounting, shall apply, except as otherwise provided.
(b) Section 444(c)(1) of the Internal Revenue Code, relating to
effect of election, shall not apply.
(c) (1) Notwithstanding the specified date contained in paragraph
(1) of subdivision (a) of Section 17024.5, Section 457 of the
Internal Revenue Code, relating to deferred compensation plans of
state and local governments and tax-exempt organizations, shall
apply, except as otherwise provided, without regard to taxable year
to the same extent as applicable for federal income tax purposes.
(2) The maximum deferred compensation for the taxable year that
may be excluded from gross income under Section 457 of the Internal
Revenue Code, as applicable for state purposes, shall not exceed the
amount of deferred compensation that may be excluded from gross
income under Section 457 of the Internal Revenue Code, as in effect
on January 1, 2010, including additional elective deferrals under
Section 414(v) of the Internal Revenue Code, as in effect on January
1, 2010.
(d) (1) For taxable years beginning on or after January 1, 2002,
the basis of any person in the plan shall be increased by the amount
of compensation not allowed to be excluded under subdivision (a).
(2) Any basis described in paragraph (1) shall be recovered in the
manner specified in Section 17085.
(e) Notwithstanding the limitations provided in subdivision (a),
any income attributable to compensation deferred in a plan in taxable
years beginning on or after January 1, 2002, in conformance with
Section 457 of the Internal Revenue Code, as applicable for federal
and state purposes, shall not be includable in the gross income of
the individual for whose benefit the plan was established until
distributed pursuant to the provisions of the plan or by operation of
law.
(f) (1) Section 451(i) of the Internal
Revenue Code, relating to special rule for sales or dispositions to
implement Federal Energy Regulatory Commission or state electric
restructuring policy, shall not apply.
(2) For taxable years beginning on or after January 1, 2015,
Section 451(c) of the Internal Revenue Code, relating to special rule
for employee tips, shall not apply.
(g) Section 457A of the Internal Revenue Code, relating to
nonqualified deferred compensation from certain tax indifferent
parties, shall not apply.
SEC. 5. Section 18631 of the Revenue and Taxation Code is amended
to read:
18631. (a) This article does not apply to any payment of interest
obligations not taxable under Part 10 (commencing with Section
17001) or Part 11 (commencing with Section 23001).
(b) Except as otherwise provided, every person required to file an
information return with the Secretary of the Treasury under any of
the federal sections listed in subdivision (c) may be required to
file a copy of the federal information return with the Franchise Tax
Board at the time and in the manner as it may, by forms and
instructions, require.
(c) Subdivision (b) shall apply to each of the following:
(1) Section 6034A of the Internal Revenue Code, relating to
information to beneficiaries of estates and trusts.
(2) Section 6039 of the Internal Revenue Code, relating to returns
required in connection with certain options.
(3) Section 6039C of the Internal Revenue Code, relating to
returns with respect to foreign persons holding direct investments in
United States real property interests, if that person holds a direct
investment in a California real property as defined in Section
18662.
(4) Section 6041 of the Internal Revenue Code, relating to
information at source.
(5) Section 6041A of the Internal Revenue Code, relating to
returns regarding payments of remuneration for services and direct
sales, except that no return or statement shall be required with
respect to direct sales pursuant to Section 6041A(b) of the Internal
Revenue Code.
(6) Section 6042 of the Internal Revenue Code, relating to returns
regarding payments of dividends and corporate earnings and profits.
(7) Section 6045 of the Internal Revenue Code, relating to returns
of brokers.
(8) Section 6049 of the Internal Revenue Code, relating to returns
regarding payments of interest.
(9) Section 6050H of the Internal Revenue Code, relating to
returns relating to mortgage interest received in trade or business
from individuals.
(10) (A) Section 6050I of the Internal Revenue Code, relating to
returns relating to cash received in trade or business, etc., except
that Section 6050I(g) of the Internal Revenue Code, relating to cash
received by criminal court, shall not apply.
(B) (i) The Attorney General shall, upon court order following a
showing ex parte to a magistrate of an articulable suspicion that an
individual or entity has committed a felony offense to which a
federal information return is related, be provided a copy of a
federal information return filed with the Franchise Tax Board under
this paragraph. The Attorney General may make a return or information
therefrom available to a district attorney subject to regulations
promulgated by the Attorney General. The regulations shall require
the district attorney seeking the return or information to specify in
writing the specific reasons for believing that a felony offense has
been committed to which the return or information is related.
(ii) Any information or return obtained by the Attorney General or
a district attorney pursuant to this subparagraph shall be
confidential and used only for investigative or prosecutorial
purposes.
(11) Section 6050J of the Internal Revenue Code, relating to
returns relating to foreclosures and abandonments of security.
(12) (A) Section 6050K of the Internal Revenue Code, relating to
returns relating to exchanges of certain partnership interests.
(B) In addition to the general requirement under subparagraph (A),
a transferor of a partnership interest shall be required to notify
the partnership of that exchange in accordance with Section 6050K(c)
of the Internal Revenue Code.
(13) Section 6050L of the Internal Revenue Code, relating to
returns relating to certain donated property.
(14) Section 6050N of the Internal Revenue Code, relating to
returns regarding payments of royalties.
(15) Section 6050P of the Internal Revenue Code, relating to
returns relating to the cancellation of indebtedness by certain
entities.
(16) Section 6050Q of the Internal Revenue Code, relating to
certain long-term care benefits.
(17) Section 6050R of the Internal Revenue Code, relating to
returns relating to certain purchases of fish.
(18) Section 6050S of the Internal Revenue Code, relating to
returns relating to higher education tuition and related expenses.
(19) Section 6052 of the Internal Revenue Code, relating to
returns regarding payment of wages in the form of group-term life
insurance.
(20) Section 6034(a) of the Internal Revenue Code, relating to
returns of split-interest trusts.
(21) Section 6039I of the Internal Revenue Code, relating to
returns and records with respect to employer-owned life insurance
contracts.
(22) Section 6039J of the Internal Revenue Code, relating to
information reporting with respect to commodity credit corporation
transactions.
(23) Section 6050V of the Internal Revenue Code, relating to
returns relating to applicable insurance contracts in which certain
exempt organizations hold interests.
(24) Section 6050W of the Internal Revenue Code, relating to
returns relating to payments made in settlement of payment card and
third party network transactions.
(25) Any information return that is required to be filed with the
Secretary of the Treasury pursuant to a provision of Part III of
Subchapter A of Chapter 61 of Subtitle F (commencing with Section
6031) of the Internal Revenue Code that is added to the Internal
Revenue Code by a public law enacted on or after January 1, 2009.
(d) Every person required to make a return under subdivision (b)
shall also furnish a statement to each person whose name is required
to be set forth in the return, as required to do so by the Internal
Revenue Code.
(e) For taxable years beginning on or after January 1, 2015,
Section 6041(e) of the Internal Revenue Code shall not apply.
SEC. 6. Section 18663 of the Revenue and Taxation Code is amended
to read:
18663. (a) (1) The Franchise Tax Board shall annually (or more
often if necessary) prepare and make available to the Employment
Development Department, wage withholding tables that shall be used by
every employer making payment of any wages to a resident employee
for services performed either within or without this state; or to a
nonresident employee for services performed in this state, to deduct
and withhold from those wages for each payroll period, a tax computed
in a manner as to produce, so far as practicable, with due regard to
the credits for personal exemptions allowable under Section 17054, a
sum that is substantially equivalent to the amount of tax reasonably
estimated to be due under Part 10 (commencing with Section 17001)
resulting from the inclusion in the gross income of the employee the
wages which were subject to withholding.
(2) For wages paid on or after November 1, 2009, wage withholding
tables prepared by the Franchise Tax Board pursuant to this
subdivision shall produce, so far as practicable, with due regard to
the credits for personal exemptions allowable under Section 17054, a
sum that will significantly prevent underwithholding by using an
amount equal to 10 percent more than the sum described in paragraph
(1).
(b) (1) (A) For supplemental wages paid on or after January 1,
1992, the rate of withholding that may be applied to supplemental
wages in lieu of the wage withholding tables specified in subdivision
(a) shall be 6 percent.
(B) For supplemental wages paid on or after November 1, 2009, the
rate of withholding shall be 6.6 percent.
(2) For purposes of this subdivision, "supplemental wages"
subdivision:
(A) "Supplemental wages"
includes, but is not limited to, bonus payments, overtime
payments, commissions, sales awards, back pay including retroactive
wage increases, and reimbursements for nondeductible moving expenses
that are paid for the same or a different period, or without regard
to a particular period.
(B) For taxable years beginning on or after January 1, 2015,
"supplemental wages" does not include tips, which includes any
gratuity provided by a customer or client of the employer's business.
(c) (1) For stock options and bonus payments that constitute wages
paid on or after January 1, 2002, the rate of withholding that may
be applied to those stock options and bonus payments in lieu of the
wage withholding tables specified in subdivision (a) shall,
notwithstanding subdivision (b), be 9.3 percent.
(2) For stock options and bonus payments that constitute wages
paid on or after November 1, 2009, the rate of withholding shall be
10.23 percent.
SEC. 7. Section 19183 of the Revenue and Taxation Code is amended
to read:
19183. (a) (1) A penalty shall be imposed for failure to file
correct information returns, as required by this part, and that
penalty shall be determined in accordance with Section 6721 of the
Internal Revenue Code.
(2) Section 6721(e) of the Internal Revenue Code is modified to
the extent that the reference to Section 6041A(b) of the Internal
Revenue Code shall not apply.
(b) (1) A penalty shall be imposed for failure to furnish correct
payee statements as required by this part, and that penalty shall be
determined in accordance with Section 6722 of the Internal Revenue
Code.
(2) Section 6722(c) of the Internal Revenue Code is modified to
the extent that the references to Sections 6041A(b) and 6041A(e) of
the Internal Revenue Code shall not apply.
(c) A penalty shall be imposed for failure to comply with other
information reporting requirements under this part, and that penalty
shall be determined in accordance with Section 6723 of the Internal
Revenue Code.
(d) (1) The provisions of Section 6724 of the Internal Revenue
Code relating to waiver, definitions, and special rules, shall apply,
except as otherwise provided.
(2) Section 6724(d)(1) of the Internal Revenue Code is modified as
follows:
(A) The following references are substituted:
(i) Subdivision (a) of Section 18640, in lieu of Section 6044(a)
(1) of the Internal Revenue Code.
(ii) Subdivision (a) of Section 18644, in lieu of Section 6050A(a)
of the Internal Revenue Code.
(B) References to Sections 4093(c)(4), 4093(e), 4101(d), 6041(b),
6041A(b), 6045(d), 6051(d), and 6053(c)(1) of the Internal Revenue
Code shall not apply.
(C) The term "information return" shall also include both of the
following:
(i) The return required by paragraph (1) of subdivision (i) of
Section 18662.
(ii) The return required by subdivision (a) of Section 18631.7.
(D) For taxable years beginning on or after January 1, 2015,
Section 6724(d)(1)(B)(xvi) of the Internal Revenue Code shall not
apply.
(3) Section 6724(d)(2) of the Internal Revenue Code is modified as
follows:
(A) The following references are substituted:
(i) Subdivision (b) of Section 18640, in lieu of Section 6044(e)
of the Internal Revenue Code.
(ii) Subdivision (b) of Section 18644, in lieu of Section 6050A(b)
of the Internal Revenue Code.
(B) References to Sections 4093(c)(4)(B), 6031(b), 6037(b), 6041A
(e), 6045(d), 6051(d), 6053(b), and 6053(c) of the Internal Revenue
Code shall not apply.
(C) The term "payee statement" shall also include the statement
required by paragraph (2) of subdivision (i) of Section 18662.
(D) Section 6724(d)(2)(X) of the Internal Revenue Code shall not
apply.
(e) In the case of each failure to provide a written explanation
as required by Section 402(f) of the Internal Revenue Code, at the
time prescribed therefor, unless it is shown that the failure is due
to reasonable cause and not to willful neglect, there shall be paid,
on notice and demand of the Franchise Tax Board and in the same
manner as tax, by the person failing to provide that written
explanation, an amount equal to ten dollars ($10) for each failure,
but the total amount imposed on that person for all those failures
during any calendar year shall not exceed five thousand dollars
($5,000).
(f) Any penalty imposed by this part shall be paid on notice and
demand by the Franchise Tax Board and in the same manner as tax.
SEC. 8. Section 927 of the Unemployment Insurance Code is amended
to read:
927. (a) "Wages" also means all tips which
are received while performing services which constitute employment
and included in a written statement furnished to the employer
pursuant to Section 6053(a) of the Internal Revenue Code.
(b) The changes in law made in this section
by Chapter 1461 of the Statutes of 1985 shall apply with respect to
wages earned on and after January 1, 1986, in conformity with the
provisions of federal law.
(c) This section is repealed on January 1, 2015.
SEC. 9. Section 940 of the Unemployment Insurance Code is amended
to read:
940. (1) For the purposes of this section,
of Sections 977 and 977.5 to the extent specified by those sections,
and of Sections 1026, 1088, 1280, 1281, 1282, 2652, 2654, 2655, and
2657, "wages" means taxable wages as well as wages which would be
taxable except for the limitations on taxable wages provided under
Sections 930 and 985.
(2) On and after January 1, 2015, "wages" shall not include tips,
which includes any gratuity provided by a customer or client of the
employer's business.
SEC. 10. Section 987.7 of the Unemployment Insurance Code is
amended to read:
987.7. (a) If the worker contributions required in any one month
to be made because of the receipt of cash tips and cash gratuities
exceed the wages of the worker under the control of the employer, the
worker may furnish the employer, on or before the 10th day of the
following month, or, if the amounts are estimated, on or before the
last day of the month following the calendar quarter, an amount equal
to the excess.
(b) If the worker contributions required by Section 984 with
respect to cash tips and cash gratuities exceed the amount of worker
contributions that can be collected by the employer from the wages of
the worker, the excess shall be paid by the worker, except as
provided by Section 1088.6. The worker shall pay the excess to the
department within 30 days from his or her receipt of the written
statement furnished by his or her employer pursuant to Section
1088.6. If the worker fails to pay the excess within the time
required by this subdivision, the director may make an assessment for
the excess and shall give the worker a written notice of the
assessment. Article 8 (commencing with Section 1126) with respect to
the assessment of contributions and Chapter 7 (commencing with
Section 1701) with respect to the collection of contributions shall
apply to the recovery of amounts under this subdivision.
(c) The director may offset amounts assessed pursuant to
subdivision (b) against any refund payable to the worker under
Section 1176.5 or against any amount of disability benefits to which
he or she may become entitled under Part 2 (commencing with Section
2601) within any of the following periods:
(1) The current disability benefit period.
(2) One year from the beginning date of any disability benefit
period that begins during the three-year period next succeeding the
service of notice of the assessment.
(d) This section is repealed on January 1,2015.
SEC. 11. Section 13009 of the Unemployment Insurance Code is
amended to read:
13009. "Wages" means all remuneration, other than fees paid to a
public official, for services performed by an employee for his or her
employer, including all remuneration paid to a nonresident employee
for services performed in this state, and the cash value of all
remuneration paid in any medium other than cash, except as provided
by this section. "Wages" includes tips received by an
employee in the course of his or her employment. The wages shall be
deemed to be paid at the time a written statement including tips is
furnished to the employer pursuant to Section 13055 or, if no
statement including those tips is so furnished, at the time received.
"Wages" includes compensation,
compensation that is deductible under Section 162 of the
Internal Revenue Code, Code paid to a
member of a limited liability company filing a federal corporate
income tax return.
"Wages" shall not include remuneration paid under any of the
following conditions:
(a) For agricultural labor, as defined in subdivision (g) of
Section 3121 of the Internal Revenue Code.
(b) For domestic service in a private home, local college club, or
local chapter of a college fraternity or sorority.
(c) For service not in the course of the employer's trade or
business performed in any calendar quarter by an employee, unless the
cash remuneration paid for that service is fifty dollars ($50) or
more and the service is performed by an individual who is regularly
employed by the employer to perform the service. For purposes of this
subdivision, an individual shall be deemed to be regularly employed
by an employer during a calendar quarter only if either of the
following conditions is met:
(1) On each of some 24 days during the quarter, the individual
performs for the employer for some portion of the day service not in
the course of the employer's trade or business.
(2) The individual was regularly employed, as determined under
paragraph (1), by the employer in the performance of the service
during the preceding calendar quarter.
(d) For services by a citizen or resident of the United States for
a foreign government or an international organization.
(e) For services performed by a nonresident alien individual as
designated by regulations prescribed by the department.
(f) For services performed by a duly ordained, commissioned, or
licensed minister of a church in the exercise of his or her ministry
or by a member of a religious order in the exercise of duties
required by the order.
(g) (1) For services performed by an individual under the age of
18 years in delivery or distribution of newspapers or shopping news,
not including delivery or distribution to any point for subsequent
delivery or distribution.
(2) For services performed by an individual in, and at the time
of, the sale of newspapers or magazines to ultimate consumers, under
an arrangement under which the newspapers or magazines are to be sold
by him or her at a fixed price, his or her compensation being based
on the retention of the excess of the price over the amount at which
the newspapers or magazines are charged to him or her whether or not
he or she is guaranteed a minimum amount of compensation for the
services, or is entitled to be credited with the unsold newspapers or
magazines turned back.
(h) For services not in the course of the employer's trade or
business, to the extent paid in any medium other than cash.
(i) To, or on behalf of, an employee or his or her beneficiary
under any of the following situations:
(1) From or to a trust which is exempt from tax under Section
17631 of the Revenue and Taxation Code at the time of payment, unless
the payment is made to an employee of the trust as remuneration for
services rendered as an employee and not as a beneficiary of the
trust.
(2) Under or to an annuity plan which, at the time of payment, is
a plan qualified pursuant to Chapter 5 (commencing with Section
17501) of Part 10 of Division 2 of the Revenue and Taxation Code.
(3) Under or to a bond purchase plan which, at the time of
payment, is a bond purchase plan qualified pursuant to Chapter 5
(commencing with Section 17501) of Part 10 of Division 2 of the
Revenue and Taxation Code.
(4) For a payment which qualifies for deduction by an employee
pursuant to Section 219 of the Internal Revenue Code if, at the time
of payment, it is reasonable to believe that the employee will be
entitled to a deduction under that section for payment.
(5) Under a cafeteria plan (within the meaning of Section 125 of
the Internal Revenue Code).
(j) To a master, officer, or any other seaman who is a member of a
crew on a vessel engaged in foreign, coastwise, intercoastal,
interstate, or noncontiguous trade.
(k) Pursuant to any provision of law other than Section 5(c) or 6(
l ) of the Peace Corps Act, for service performed as a
volunteer or volunteer leader within the meaning of that act.
( l ) In the form of group-term life insurance on the
life of an employee.
(m) To or on behalf of an employee, and to the extent that, at the
time of the payment of remuneration it is reasonable to believe that
a corresponding deduction is allowable for moving expenses pursuant
to Article 6 (commencing with Section 17201) of Chapter 3 of Part 10
of Division 2 of the Revenue and Taxation Code.
(n) (1) As tips in any medium other than cash.
medium.
(2) As cash tips to an employee in any calendar month in the
course of his or her employment by an employer, unless the
amount of the cash tips is twenty dollars ($20) or more.
employer.
(3) As tips, including any gratuity provided by a customer or
client of the employer's business.
(o) For service performed by an individual on a boat engaged in
catching fish or other forms of aquatic animal life under an
arrangement with the owner or operator of the boat pursuant to which
all of the following apply:
(1) The individual does not receive any cash remuneration, other
than as provided in paragraph (2).
(2) The individual receives a share of the boat's (or the boats'
in the case of a fishing operation involving more than one boat)
catch of fish or other forms of aquatic animal life or a share of the
proceeds from the sale of the catch.
(3) The amount of the individual's share depends on the amount of
the boat's (or the boats' in the case of a fishing operation
involving more than one boat) catch of fish or other forms of aquatic
animal life.
This subdivision shall apply only where the operating crew of the
boat (or each boat from which the individual receives a share in the
case of a fishing operation involving more than one boat) is normally
made up of fewer than 10 individuals.
(p) For any medical care reimbursement made to, or for the benefit
of, an employee under a self-insured medical reimbursement plan
pursuant to Section 105(h)(6) of the Internal Revenue Code.
(q) To, or on behalf of, an employee to the extent not includable
in gross income pursuant to Section 13006.
(r) For services to which Section 633 applies.
(s) The changes made to this section by the act adding this
subdivision shall apply on and after January 1, 2015.
SEC. 12. Section 13009.5 of the Unemployment Insurance Code is
amended to read:
13009.5. (a) For purposes of the report required by subdivision
(a) of Section 1088 and the statement required by Section 13050,
"wages subject to personal income tax" means all of the following:
(1) Remuneration defined as wages by Section 13009,
except that in the case of tips received by an employee in the course
of his or her employment, the amounts shall include only those tips
included in
statements furnished to the employer, pursuant to Section 13055.
13009.
(2) Remuneration described in subdivisions (a), (b), (f), and (
l ) of Section 13009, to the extent included in gross
income.
(3) Payments made by a third party for sick pay as specified in
Section 931.5.
(A) Any employer who receives a report of wages from a third-party
payer as provided for in subdivisions (a) and (b) of Section 931.5
shall report those wages to the department as required under
paragraph (2) of subdivision (a) of Section 1088.
(B) Any third-party payer described in Section 931.5 who fails to
report wages to an employer as provided for in that section shall
report those wages to the department as required under paragraph (2)
of subdivision (a) of Section 1088.
(b) (1) A person or entity shall not be required to register with
the Employment Development Department solely for the purpose of
reporting wages subject to personal income tax pursuant to Section
1088 unless that registration is otherwise required by this code.
(2) A person or entity shall not be required to withhold any tax
under Section 13020 for wages, as defined by this section, unless
that person or entity is required to withhold tax for those wages as
defined by Section 13009.
SEC. 13. Section 13027 of the Unemployment Insurance Code is
amended to read:
13027. (a) In the case of tips which
constitute wages, subdivision (a) of Section 13020 shall be
applicable only to such tips as are included in a written statement
furnished to the employer pursuant to Section 13055, and only to the
extent that the tax can be deducted and withheld by the employer, at
or after the time such statement is so furnished and before the close
of the calendar year in which such statement is furnished, from such
wages of the employee (excluding tips, but including funds turned
over by the employee to the employer for the purpose of such
deduction and withholding) as are under the control of the employer.
An employer who is furnished by an employee a written statement of
tips (received in a calendar month) pursuant to Section 13055 to
which paragraph (2) of subdivision (n) of Section 13009 is applicable
may deduct and withhold the tax with respect to such tips from any
wages of the employee (excluding tips) under his or her control, even
though at the time such statement is furnished the total amount of
the tips included in statements furnished to the employer as having
been received by the employee in such calendar month in the course of
his or her employment by the employer is less than twenty dollars
($20). Such tax shall not at any time be deducted and withheld in any
amount which exceeds the aggregate of such wages and funds.
(b) This section is repealed on January 1, 2015.
SEC. 14. Section 13055 of the Unemployment Insurance Code is
amended to read:
13055. (a) Every employee who, in the
course of his or her employment by an employer, receives in any
calendar month tips which are wages shall report all such tips in one
or more written statements furnished to his or her employer on or
before the 10th day following such month. Such statements shall be
furnished by the employee under such authorized regulations, at such
other times before such 10th day, and in such form and manner as may
be prescribed by the department.
(b) This section is repealed on January 1, 2015.