Bill Text: CA AB809 | 2009-2010 | Regular Session | Introduced

California Assembly Bill 809 (Prior Session Legislation)

Introduced

Bill Title: Taxation: federal conformity.

Sponsorship: Partisan Bill (Republican 1)

Status: (Introduced - Dead) 2010-02-02 - Died at Desk. [AB809 Detail]

Download: California-2009-AB809-Introduced.html

BILL NUMBER: AB 809	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Villines

                        FEBRUARY 26, 2009

   An act to amend Section 23051.5 of the Revenue and Taxation Code,
relating to taxation.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 809, as introduced, Villines. Taxation: federal conformity.
   Under existing law, various provisions of the Internal Revenue
Code, as enacted as of a specified date, are referenced in various
sections of the Revenue and Taxation Code. Existing law specifies
which provisions of the Internal Revenue Code are applicable for
purposes of state income tax laws.
   This bill would make technical, nonsubstantive changes to these
provisions.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 23051.5 of the Revenue and Taxation Code is
amended to read:
   23051.5.  (a) (1) Unless otherwise specifically provided, the
terms "Internal Revenue Code," "Internal Revenue Code of 1954," or
"Internal Revenue Code of 1986," for purposes of this part, mean
Title 26 of the United States Code, including all amendments thereto,
as enacted on the specified date for the applicable taxable year as
defined in paragraph (1) of subdivision (a) of Section 17024.5.
   (2) (A) Unless otherwise specifically provided, for federal laws
enacted on or after January 1, 1987, and on or before the specified
date for the taxable year, uncodified provisions that relate to
provisions of the Internal Revenue Code that are incorporated for
purposes of this part, shall be applicable to the same taxable years
as the incorporated provisions.
   (B) In the case where Section 901 of the Economic Growth and Tax
Relief Act of 2001 (Public Law 107-16) applies to any provision of
the Internal Revenue Code that is incorporated for purposes of this
part, Section 901 of the Economic Growth and Tax Relief Act of 2001
(Public Law 107-16) shall apply for purposes of this part in the same
manner and to the same taxable years as it applies for federal
income tax purposes.
   (3) Subtitle G (Tax Technical Corrections) and Part I of Subtitle
H (Repeal of Expired or Obsolete Provisions) of the Revenue
Reconciliation Act of 1990 (Public Law 101-508) modified numerous
provisions of the Internal Revenue Code and provisions of prior
federal acts, some of which are incorporated by reference into this
part. Unless otherwise provided, the provisions described in the
preceding sentence, to the extent that they modify provisions that
are incorporated into this part, are declaratory of existing law and
shall be applied in the same manner and for the same periods as
specified in the Revenue Reconciliation Act of 1990.
   (b) Unless otherwise specifically provided, when applying the
Internal Revenue Code for purposes of this part, a reference to any
of the following is not applicable for purposes of this part:
   (1) Domestic International Sales Corporations (DISC), as defined
in Section 992(a) of the Internal Revenue Code.
   (2) Foreign Sales Corporations (FSC), as defined in Section 922(a)
of the Internal Revenue Code.
   (3) A personal holding company, as defined in Section 542 of the
Internal Revenue Code.
   (4) A foreign personal holding company, as defined in Section 552
of the Internal Revenue Code.
   (5) A foreign investment company, as defined in Section 1246(b) of
the Internal Revenue Code.
   (6) A foreign trust as defined in Section 679 of the Internal
Revenue Code.
   (7) Foreign income taxes and foreign income tax credits.
   (8) Federal tax credits and carryovers of federal tax credits.
   (c) (1) The provisions contained in Sections 41 to 44, inclusive,
and Section 172 of the Tax Reform Act of 1984 (Public Law 98-369),
relating to treatment of debt instruments, is not applicable for
taxable years beginning before January 1, 1987.
   (2) The provisions contained in Public Law 99-121, relating to the
treatment of debt instruments, is not applicable for taxable years
beginning before January 1, 1987.
   (3) For taxable years beginning on and after January 1, 1987, the
provisions referred to by paragraphs (1) and (2) shall be applicable
for purposes of this part in the same manner and with respect to the
same obligations as the federal provisions, except as otherwise
provided in this part.
   (d) When applying the Internal Revenue Code for purposes of this
part, regulations promulgated in final form or issued as temporary
regulations by "the secretary" shall be applicable as regulations
issued under this part to the extent that they do not conflict with
this part or with regulations issued by the Franchise Tax Board.
   (e) Whenever this part allows a taxpayer to make an election, the
following rules shall apply:
   (1) A proper election filed with the Internal Revenue Service in
accordance with the Internal Revenue Code or regulations issued by
"the secretary" shall be deemed to be a proper election for purposes
of this part, unless otherwise expressly provided in this part or in
regulations issued by the Franchise Tax Board.
   (2) A copy of that election shall be furnished to the Franchise
Tax Board upon request.
   (3) (A) Except as provided in subparagraph (B), in order to obtain
treatment other than that elected for federal purposes, a separate
election shall be filed with the Franchise Tax Board at the time and
in the manner that may be required by the Franchise Tax Board.
   (B) (i) If a taxpayer makes a proper election for federal income
tax purposes prior to the time that taxpayer becomes subject to the
tax imposed under this part or Part 10 (commencing with Section
17001), that taxpayer is deemed to have made the same election for
purposes of the tax imposed by this part, Part 10 (commencing with
Section 17001), and Part 10.2 (commencing with Section 18401), as
applicable, and that taxpayer  may   shall 
not make a separate election for California tax purposes unless that
separate election is expressly authorized by this part, Part 10
(commencing with Section 17001), or Part 10.2 (commencing with
Section 18401), or by regulations issued by the Franchise Tax Board.
   (ii) If a taxpayer has not made a proper election for federal
income tax purposes prior to the time that taxpayer becomes subject
to tax under this part or Part 10 (commencing with Section 17001),
that taxpayer may   shall  not make a
separate California election for purposes of this part, Part 10
(commencing with Section 17001), or Part 10.2 (commencing with
Section 18401), unless that separate election is expressly authorized
by this part, Part 10 (commencing with Section 17001), Part 10.2
(commencing with Section 18401), or by regulations issued by the
Franchise Tax Board.
   (iii) This subparagraph applies only to the extent that the
provisions of the Internal Revenue Code or regulations issued by "the
secretary" authorizing an election for federal income tax purposes
apply for purposes of this part, Part 10 (commencing with Section
17001), or Part 10.2 (commencing with Section 18401).
   (f) Whenever this part allows or requires a taxpayer to file an
application or seek consent, the rules set forth in subdivision (e)
shall apply to that application or consent.
   (g) When applying the Internal Revenue Code for purposes of
determining the statute of limitations under this part,  any
  a  reference to a period of three years shall be
modified to read four years for purposes of this part.
   (h) When applying, for purposes of this part, any section of the
Internal Revenue Code or any applicable regulation thereunder, all of
the following shall apply:
   (1) For purposes of Chapter 2 (commencing with Section 23101),
Chapter 2.5 (commencing with Section 23400), and Chapter 3
(commencing with Section 23501), the term "taxable income" shall mean
"net income."
   (2) For purposes of Article 2 (commencing with Section 23731) of
Chapter 4, the term "taxable income" shall mean "unrelated business
taxable income," as defined by Section 23732.
   (3) Any reference to "subtitle," "Chapter 1," or "chapter" shall
mean this part.
   (4) The provisions of Section 7806 of the Internal Revenue Code,
relating to construction of title, shall apply.
   (5) Any provision of the Internal Revenue Code that becomes
operative on or after the specified date for that taxable year shall
become operative on the same date for purposes of this part.
   (6) Any provision of the Internal Revenue Code that becomes
inoperative on or after the specified date for that taxable year
shall become inoperative on the same date for purposes of this part.
   (7) Due account shall be made for differences in federal and state
terminology, effective dates, substitution of "Franchise Tax Board"
for "secretary" when appropriate, and other obvious differences.
   (8) Any provision of the Internal Revenue Code that refers to a
"corporation" shall, when applicable for purposes of this part,
include a "bank," as defined by Section 23039.
   (i) Any reference to a specific provision of the Internal Revenue
Code shall include modifications of that provision, if any, in this
part.