Bill Text: CA AB2490 | 2015-2016 | Regular Session | Amended

California Assembly Bill 2490 (Prior Session Legislation)

Bill Title: Corporation Tax Law: exemption: regulated investment company.

Sponsorship: Partisan Bill (Democrat 1)

Status: (Failed) 2016-11-30 - From committee without further action. [AB2490 Detail]

Download: California-2015-AB2490-Amended.html

BILL NUMBER: AB 2490	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MAY 16, 2016
	AMENDED IN ASSEMBLY  APRIL 26, 2016
	AMENDED IN ASSEMBLY  APRIL 11, 2016
	AMENDED IN ASSEMBLY  MARCH 17, 2016

INTRODUCED BY   Assembly Member Gatto

                        FEBRUARY 19, 2016

   An act to add  and repeal  Section 23714  to
  of  the Revenue and Taxation Code, relating to
taxation, to take effect immediately, tax levy.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 2490, as amended, Gatto. Corporation Tax Law: exemption:
regulated investment company.
   Existing law, the Corporation Tax Law, generally conforms to the
federal income tax laws that apply to a regulated investment company
and further provides that for purposes of the Corporation Tax Law,
its "net income" is equal to its "investment company income."
Existing law exempts from tax under the Corporation Tax Law, various
organizations including credit unions, fraternal societies, social
welfare organizations, and labor organizations.
   This bill would provide that under the Corporation Tax Law,
 a regulated investment company that is a mutual fund
investment management company owned by investors in the mutual funds
that it serves   a mutual fund investment management
company wholly owned by one or more regulated investment companies
  and providing management services to the one or more
regulated investment companies "at cost"  is not subject to
 tax.   tax, except as specified.  The bill
would authorize the Franchise Tax Board to promulgate regulations as
necessary or appropriate to carry out this provision.  The bill
would repeal these provisions on January 1, 2022. 
   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 1.  Section 23714 is added to the Revenue and Taxation
Code, to read:
   23714.  (a) Notwithstanding any other law,  a regulated
investment company,   a mutual fund investment
management company wholly owned by one or more regulated investment
companies,  as defined in Section 851 of the Internal Revenue
Code, relating to definition of regulated investment company,
 that is a mutual fund investment management company owned by
investors in the mutual funds that it serves   and
provid   ing management services to the one or more
regulated investment companies "at cost  "  is exempt
from the taxes imposed by this part, except as provided in Article 2
(commencing with Section 23731).
   (b) The Franchise Tax Board may promulgate regulations as
necessary or appropriate to carry out the purposes of this section.

   (c) This section shall be repealed on January 1, 2022. 
  SEC. 2.  This act provides for a tax levy within the meaning of
Article IV of the California  Constitution and shall go into
immediate effect.