Bill Text: CA AB2771 | 2015-2016 | Regular Session | Amended

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Bill Title: Personal income taxes: credits: taxes paid to another state.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Failed) 2016-11-30 - From committee without further action. [AB2771 Detail]

Download: California-2015-AB2771-Amended.html

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BILL NUMBER: AB 2771	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  APRIL 11, 2016

INTRODUCED BY   Assembly Member Irwin
   (Principal coauthor: Assembly Member Low)

                        FEBRUARY 19, 2016

   An act to amend Section 18001 of the Revenue and Taxation Code,
relating to taxation,  and declaring the urgency thereof, to
take effect immediately.   to take effect immediately,
tax levy. 



	LEGISLATIVE COUNSEL'S DIGEST


   AB 2771, as amended, Irwin. Personal income taxes: credits: taxes
paid to another state.
   The Personal Income Tax Law provides a credit against the taxes
imposed by that law to residents for specified taxes paid to another
state on income derived from sources within that state. Existing law
 , for purposes of a calculation used in determining the credit
amount,  determines that income by applying the nonresident
sourcing rules for determining income from sources within California,
including the single sales factor apportionment formula.
   This  bill   bill, for purposes of the
above-described calculation,  would provide that California's
single sales factor apportionment formula, and the regulations issued
thereunder, shall not be applied in lieu of another state's
apportionment rules when determining income derived from sources in
that state. 
   This bill would declare that it is to take effect immediately as
an urgency statute.  
   This bill would take effect immediately as a tax levy. 
   Vote:  2/3   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 18001 of the Revenue and Taxation Code is
amended to read:
   18001.  (a) Subject to the following conditions, residents shall
be allowed a credit against the "net tax" (as defined by Section
17039) for net income taxes imposed by and paid to another state (not
including any preference, alternative, or minimum tax comparable to
the tax imposed by Section 17062) on income taxable under this part:
   (1) The credit shall be allowed only for taxes paid to the other
state (not including any preference, alternative, or minimum tax
comparable to the tax imposed by Section 17062) on income derived
from sources within that state which is taxable under its laws
irrespective of the residence or domicile of the recipient.
   This paragraph shall not apply to residents to whom subdivision
(b) of Section 17014 applies.
   (2) The credit shall not be allowed if the other state allows
residents of this state a credit against the taxes imposed by that
state (not including any preference, alternative, or minimum tax
comparable to the tax imposed by Section 17062) for "net tax" (as
defined by Section 17039) paid or payable under this part.
   (3) The credit shall not exceed the proportion of the "net tax"
(as defined by Section 17039) payable under this part as the income
subject to tax in the other state (not including any preference,
alternative, or minimum tax comparable to the tax imposed by Section
17062) and also taxable under this part bears to the taxpayer's
entire income upon which the "net tax" (as defined by Section 17039)
is imposed by this part.
   (4) No credit shall be allowed under this section for any tax
imposed by Section 17062.
   (b) For purposes of this section, the amount of "net income taxes"
paid to another state shall include the taxpayer's pro rata share of
any taxes on, or according to, or measured by, income or profits
paid or accrued, which were paid by an S corporation, as provided by
Section 18006.
   (c) For purposes of this section, "income derived from sources
within that state" shall be determined by applying the nonresident
sourcing rules for determining income from sources within this state,
as specified in Chapter 11 (commencing with Section 17951), and the
regulations thereunder, except that the apportionment rules in
Sections 25128 to 25139, inclusive, and the regulations thereunder,
shall not be applied in lieu of that other state's apportionment
rules. 
  SEC. 2.    This act is an urgency statute
necessary for the immediate preservation of the public peace, health,
or safety within the meaning of Article IV of the Constitution and
shall go into immediate effect. The facts constituting the necessity
are:
   In order to reduce the burden of filing tax returns and to
increase ease of compliance with existing tax laws, it is necessary
that this act take effect immediately. 
   SEC. 2.    This act provides for a tax levy within
the meaning of Article IV of the Constitution and shall go into
immediate effect.