Bill Text: CA SB1542 | 2011-2012 | Regular Session | Amended
Bill Title: Income taxes: credit: contributions to LEAP.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2012-05-03 - Set, first hearing. Hearing canceled at the request of author. [SB1542 Detail]
Download: California-2011-SB1542-Amended.html
BILL NUMBER: SB 1542 AMENDED
BILL TEXT
AMENDED IN SENATE MAY 1, 2012
AMENDED IN SENATE APRIL 10, 2012
INTRODUCED BY Senator Negrete McLeod
FEBRUARY 24, 2012
An act to add Sections 17053.82 and 23682 to the Revenue and
Taxation Code, relating to taxation, to take effect immediately, tax
levy.
LEGISLATIVE COUNSEL'S DIGEST
SB 1542, as amended, Negrete McLeod. Income taxes: credit:
contributions to LEAP.
The Personal Income Tax Law and the Corporation Tax Law allow
various credits against the taxes imposed by those laws.
This bill would allow a credit against the taxes imposed under the
Personal Income Tax Law and the Corporation Tax Law for monetary
contributions to a Local Educational Advancement Program (LEAP)
organization that provides fee assistance for students in
kindergarten and grades 1 to 12, inclusive, from families with
demonstrated financial needs, to receive academic services before or
after regular school hours, on weekends, or in the summer, as
provided.
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 17053.82 is added to the Revenue and Taxation
Code, to read:
17053.82. (a) (1) There shall be allowed as a credit against the
"net tax," as defined in Section 17039, an amount equal to the
monetary amount contributed during the taxable year by a taxpayer to
a local educational advancement program organization that provides
fee assistance to qualified students to receive academic services
outside of the regular school day schoolday
.
(2) The maximum amount of credit allowed under this section per
taxable year is five hundred dollars ($500) or one thousand dollars
($1,000) for persons making a joint return.
(b) For purposes of this section, the following definitions shall
apply:
(1) "Academic services" includes, but is not limited to,
afterschool programs or summer and vacation school programs at public
or accredited private schools, tutoring, diagnostic evaluations,
college and career preparation, and online learning that are provided
outside of the regular school day schoolday
. Academic services may be provided by a public or private
entity, including, but not limited to, a public school, private
school, school district, school foundation, county office of
education, educational service agency, institution of higher
education, faith-based organization, community-based organization, or
private business, including a sole proprietor.
(2) "Fee assistance" means financial assistance to cover partial
or full payment of fees associated with the general cost of academic
services, including transportation costs, that is granted on a
needs-based, ability to pay, formula demonstrated by household income
or extenuating circumstances, or both.
(3) "Local educational advancement program organization" means an
organization that meets all of the following:
(A) Is an organization that is exempt from federal income tax as
an organization described in Section 501(c)(3) of the Internal
Revenue Code, or a government entity, including, but not limited to,
a school district, school foundation, county office of education,
educational service agency, institution of higher education,
faith-based organization, or community-based organization.
(B) Uses at least 97 percent of the monetary contributions that it
receives for fee assistance.
(C) Makes fee assistance available for students from more than one
school.
(4) "Outside the regular school day"
schoolday " means the time before or after regular
school hours, on weekends, or in the summer.
(5) "Public school" means a school, including a charter school,
that provides instruction in kindergarten and grades 1 to 12,
inclusive, established by the Legislature, or by municipal or
district authority.
(6) "Qualified students" means students in kindergarten and grades
1 to 12, inclusive, from families with demonstrated financial needs,
enrolled at a public school, accredited private school, or home
school.
(c) In the case where the credit allowed by this section exceeds
the "net tax," the excess may be carried over to reduce the "net tax"
in the following year, and the succeeding four years if necessary,
until the credit is exhausted.
(d) The total amount of credit allowed under this section shall
not exceed one hundred million dollars ($100,000,000). However, this
amount may increase by 25 percent in any taxable year after 90
percent of the total amount of credit allowed under this section, as
adjusted, has been allowed.
(e) The credit under this section shall be in addition to any
deduction under this part to which the taxpayer may be entitled.
(f) The Franchise Tax Board shall promulgate rules and regulations
as necessary or appropriate to implement this section.
SEC. 2. Section 23682 is added to the Revenue and Taxation Code,
to read:
23682. (a) (1) (A) There shall be allowed
as a credit against the "tax," as defined in Section 23036, an amount
equal to 50 percent of the monetary amount contributed
during the taxable year by a taxpayer to a local educational
advancement program organization that provides fee assistance to
qualified students to receive academic services outside of the
regular school day schoolday
.
(B) Notwithstanding subparagraph (A), there shall be allowed as a
credit against the "tax," as defined in Section 23036, an amount
equal to 75 percent of the monetary amount contributed during the
taxable year by a taxpayer to a local educational advancement program
organization that provides fee assistance to qualified students to
receive academic services outside of the regular schoolday, if both
of the following conditions are met:
(i) The taxpayer certifies that in each of the following two
succeeding taxable years, that the taxpayer will contribute an amount
that is at least 80 percent of the amount contributed in the current
taxable year. The certification shall be made in a form and manner
determined by the Franchise Tax Board.
(ii) This subparagraph shall only apply to contributions that are
made in one consecutive three-taxable-year period.
(2) The maximum amount of credit allowed under this section per
taxable year is as follows:
(A) Fifty percent of the total tax liability of a taxpayer for the
taxable year under this part, before allowance of any credit under
this section, not to exceed three hundred thousand dollars
($300,000).
(B) Notwithstanding subparagraph (A), 75 percent of the total tax
liability of a taxpayer for the taxable year under this part, before
allowance of any credit under this section, if the following are met:
(i) The taxpayer certifies that in each of the following two
succeeding taxable years, that the taxpayer will contribute an amount
that is at least 80 percent of the amount contributed in the current
taxable year. The certification shall be made in a form and manner
determined by the Franchise Tax Board.
(ii) The amount of credit allowed to a taxpayer under this
subparagraph shall not exceed three hundred thousand dollars
($300,000) each taxable year.
(iii) This subparagraph shall only apply to contributions that are
made in one consecutive three-taxable year
three-taxable-year period.
(b) For purposes of this section, the following definitions shall
apply:
(1) "Academic services" includes, but is not limited to,
afterschool programs or summer and vacation school programs at public
or accredited private schools, tutoring, diagnostic evaluations,
college and career preparation, and online learning that are provided
outside of the regular school day schoolday
. Academic services may be provided by a public or private
entity, including, but not limited to, a public school, private
school, school district, school foundation, county office of
education, educational service agency, institution of higher
education, faith-based organization, community-based organization, or
private business, including a sole proprietor.
(2) "Fee assistance" means financial assistance to cover partial
or full payment of fees associated with the general cost of academic
services, including transportation costs, that is granted on a
needs-based, ability to pay, formula demonstrated by household income
or extenuating circumstances, or both.
(3) "Local educational advancement program organization" means an
organization that meets all of the following:
(A) Is an organization that is exempt from federal income tax as
an organization described in Section 501(c)(3) of the Internal
Revenue Code, or a government entity, including, but not limited to,
a school district, school foundation, county office of education,
educational service agency, institution of higher education,
faith-based organization, or community-based organization.
(B) Uses at least 97 percent of the monetary contributions that it
receives for fee assistance.
(C) Makes fee assistance available for students from more than one
school.
(4) "Outside the regular school day"
schoolday" means the time before or after regular school hours,
on weekends, or in the summer.
(5) "Public school" means a school, including a charter school,
that provides instruction in kindergarten and grades 1 to 12,
inclusive, established by the Legislature, or by municipal or
district authority.
(6) "Qualified students" means students in kindergarten and grades
1 to 12, inclusive, from families with demonstrated financial needs,
enrolled at a public school, accredited private school, or home
school.
(c) Any credits used that were allowed pursuant to
subparagraph (B) of paragraph (2) of subdivision (a) where
a recapture event occurs shall be included in the income in the
taxable year in which the recapture event occurred. For purposes of
this subdivision, a "recapture event" occurs for purposes of
subparagraph (B) of paragraph (1) of subdivision (a) when the
taxpayer fails to contribute an amount as certified in clause
(i) of subparagraph (B) of paragraph (1) of subdivision (a)
and occurs for purposes of subparagraph (B)of paragraph (2) of
subdivision (a)when the taxpayer fails to contribute an amount
as certified in clause (i) of subparagraph (B) of
paragraph (2) of subdivision (a).
(d) The total amount of credit allowed under this section shall
not exceed two hundred million dollars ($200,000,000). However, this
amount may increase by 25 percent in any taxable year after 90
percent of the total amount of credit allowed under this section, as
adjusted, has been allowed.
(e) The Franchise Tax Board shall promulgate rules and regulations
as necessary or appropriate to implement this section.
SEC. 3. This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.
