Bill Text: CA SB414 | 2013-2014 | Regular Session | Introduced
Bill Title: Income taxes: credits: qualified employees.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2014-02-03 - Returned to Secretary of Senate pursuant to Joint Rule 56. [SB414 Detail]
Download: California-2013-SB414-Introduced.html
BILL NUMBER: SB 414 INTRODUCED
BILL TEXT
INTRODUCED BY Senator Knight
FEBRUARY 20, 2013
An act to add Sections 17053.81, 17053.82, 23623.1, and 23623.2 to
the Revenue and Taxation Code, relating to taxation, to take effect
immediately, tax levy.
LEGISLATIVE COUNSEL'S DIGEST
SB 414, as introduced, Knight. Income taxes: credits: qualified
employees.
The Personal Income Tax Law and the Corporation Tax Law allow
various credits against the taxes imposed by those laws.
This bill would, under both laws, for taxable years beginning on
or after January 1, 2013, allow a credit to a qualified employer, as
defined, in an amount equal to 50% of the tuition reimbursed to, and
either 5% or 10% of the qualified wages paid to, a qualified employee
working in qualified industry, as defined to include the manufacture
of aerospace or defense hardware or software, aerospace maintenance,
aerospace repair and overhaul, parts supply to the aerospace
industry, provision of services and support relating to the aerospace
industry, research and development of aerospace technology and
systems, and the education and training of aerospace personnel, 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 17053.81 is added to the Revenue and Taxation
Code, to read:
17053.81. (a) (1) For each taxable year beginning on or after
January 1, 2013, there shall be allowed to a qualified employer a
credit against the "net tax," as defined in Section 17039, in an
amount equal to 50 percent, subject to paragraph (2), of the tuition
reimbursed to a qualified employee by a qualified employer.
(2) For each taxable year in which the credit is allowed, the
credit amount shall not exceed 50 percent, per qualified employee, of
the average annual tuition paid by a qualified employee that
received an undergraduate or graduate degree at the University of
California or the California State University. For purposes of this
subdivision, "tuition" shall not include the cost of books, fees, or
room and board.
(3) The credit shall be allowed only for the first four years of
employment of the qualified employee by the qualified employer.
(b) For purposes of this section:
(1) "Full-time" means either:
(A) The employee is paid wages subject to Division 6 (commencing
with Section 13000) of the Unemployment Insurance Code for not less
than an average of 35 hours per week.
(B) The employee is salaried and was paid compensation during the
taxable year for full-time employment, within the meaning of Section
515 of the Labor Code.
(2) "Qualified employee" means a person who is employed by, or
contracts with, the qualified employer in a full-time position in the
state within one year of being awarded an undergraduate or graduate
degree from an engineering program accredited by the Engineering
Accreditation Commission of the Accreditation Board for Engineering
and Technology, offered by the University of California, the
California State University, or a private college or university that
is accredited by a national accrediting body, for work in a qualified
industry and who was not employed by any qualified employer for work
in a qualified industry prior to his or her current employment or
contract.
(3) "Qualified employer" means a person or entity who is engaged
in a trade or business in a qualified industry.
(4) "Qualified industry" means the manufacture of aerospace or
defense hardware or software, aerospace maintenance, aerospace repair
and overhaul, parts supply to the aerospace industry, provision of
services and support relating to the aerospace industry, research and
development of aerospace technology and systems, and the education
and training of aerospace personnel.
(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 succeeding years if necessary, until the
credit is exhausted.
(d) (1) The Franchise Tax Board may prescribe rules, guidelines,
or procedures necessary or appropriate to carry out the purposes of
this section.
(2) Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code does not apply to any
standard, criterion, procedure, determination, rule, notice, or
guideline established or issued by the Franchise Tax Board pursuant
to this section.
SEC. 2. Section 17053.82 is added to the Revenue and Taxation
Code, to read:
17053.82. (a) (1) For each taxable year beginning on or after
January 1, 2013, there shall be allowed to a qualified employer as a
credit against the "net tax," as defined in Section 17039, an amount
as specified in paragraph (2) per each qualified employee employed
during the taxable year by the qualified employer.
(2) (A) Ten percent of the qualified wages of the qualified
employee if he or she received an undergraduate or graduate degree
from a public or private college or university located in this state.
(B) Five percent of the qualified wages of the qualified employee
if he or she received an undergraduate or graduate degree from a
public or private college or university located outside of this
state.
(C) The maximum amount of credit allowed pursuant to this section
is twelve thousand five hundred dollars ($12,500) per qualified
employee per taxable year.
(3) The credit shall be allowed only for the first five years of
employment of the qualified employee by the qualified employer.
(b) For purposes of this section:
(1) "Full-time" means either:
(A) The employee is paid wages subject to Division 6 (commencing
with Section 13000) of the Unemployment Insurance Code for not less
than an average of 35 hours per week.
(B) The employee is salaried and was paid compensation during the
taxable year for full-time employment, within the meaning of Section
515 of the Labor Code.
(2) "Qualified employee" means a person who is employed by, or
contracts with, the qualified employer in a full-time position in the
state within one year of being awarded an undergraduate or graduate
degree from a program that has been accredited by the Engineering
Accreditation Commission of the Accreditation Board for Engineering
and Technology offered by a public or private college or university
accredited by a national accrediting body, for work in a qualified
industry and who was not employed by any qualified employer for work
in a qualified industry prior to his or her current employment or
contract.
(3) "Qualified employer" means a person or entity who is engaged
in a trade or business in a qualified industry.
(4) "Qualified industry" means the manufacture of aerospace or
defense hardware or software, aerospace maintenance, aerospace repair
and overhaul, parts supply to the aerospace industry, provision of
services and support relating to the aerospace industry, research and
development of aerospace technology and systems, and the education
and training of aerospace personnel.
(5) "Qualified wages" means wages subject to withholding tax
pursuant to Division 6 (commencing with Section 13000) of the
Unemployment Insurance Code paid to employee, salary, or other
remuneration. "Qualified wages" shall not include employer-provided
retirement, medical or health care benefits, reimbursement for
travel, meals, lodging, or any other expense.
(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 succeeding years if necessary, until the
credit is exhausted.
(d) (1) The Franchise Tax Board may prescribe rules, guidelines,
or procedures necessary or appropriate to carry out the purposes of
this section.
(2) Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code does not apply to any
standard, criterion, procedure, determination, rule, notice, or
guideline established or issued by the Franchise Tax Board pursuant
to this section.
SEC. 3. Section 23623.1 is added to the Revenue and Taxation Code,
to read:
23623.1. (a) (1) For each taxable year beginning on or after
January 1, 2013, there shall be allowed to a qualified employer a
credit against the "tax," as defined in Section 23036, in an amount
equal to 50 percent, subject to paragraph (2), of the tuition
reimbursed to a qualified employee by a qualified employer.
(2) For each taxable year in which the credit is allowed, the
credit amount shall not exceed 50 percent, per qualified employee, of
the average annual tuition paid by a qualified employee that
received an undergraduate or graduate degree at the University of
California or the California State University. For purposes of this
subdivision, "tuition" shall not include the cost of books, fees, or
room and board.
(3) The credit shall be allowed only for the first four years of
employment of the qualified employee by the qualified employer.
(b) For purposes of this section:
(1) "Full-time" means either:
(A) The employee is paid wages subject to Division 6 (commencing
with Section 13000) of the Unemployment Insurance Code for not less
than an average of 35 hours per week.
(B) The employee is salaried and was paid compensation during the
taxable year for full-time employment, within the meaning of Section
515 of the Labor Code.
(2) "Qualified employee" means a person who is employed by, or
contracts with, the qualified employer in a full-time position in the
state within one year of being awarded an undergraduate or graduate
degree from an engineering program accredited by the Engineering
Accreditation Commission of the Accreditation Board for Engineering
and Technology, offered by the University of California, the
California State University, or a private college or university that
is accredited by a national accrediting body, for work in a qualified
industry and who was not employed by any qualified employer for work
in a qualified industry prior to his or her current employment or
contract.
(3) "Qualified employer" means a person or entity who is engaged
in a trade or business in a qualified industry.
(4) "Qualified industry" means the manufacture of aerospace or
defense hardware or software, aerospace maintenance, aerospace repair
and overhaul, parts supply to the aerospace industry, provision of
services and support relating to the aerospace industry, research and
development of aerospace technology and systems, and the education
and training of aerospace personnel.
(c) In the case where the credit allowed by this section exceeds
the "tax," the excess may be carried over to reduce the "tax" in the
following year, and succeeding years if necessary, until the credit
is exhausted.
(d) (1) The Franchise Tax Board may prescribe rules, guidelines,
or procedures necessary or appropriate to carry out the purposes of
this section.
(2) Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code does not apply to any
standard, criterion, procedure, determination, rule, notice, or
guideline established or issued by the Franchise Tax Board pursuant
to this section.
SEC. 4. Section 23623.2 is added to the Revenue and Taxation Code,
to read:
23623.2. (a) (1) For each taxable year beginning on or after
January 1, 2013, there shall be allowed to a qualified employer as a
credit against the "tax," as defined in Section 23036, an amount as
specified in paragraph (2) per each qualified employee employed
during the taxable year by the qualified employer.
(2) (A) Ten percent of the qualified wages of the qualified
employee if he or she received an undergraduate or graduate degree
from a public or private college or university located in this state.
(B) Five percent of the qualified wages of the qualified employee
if he or she received an undergraduate or graduate degree from a
public or private college or university located outside of this
state.
(C) The maximum amount of credit allowed pursuant to this section
is twelve thousand five hundred dollars ($12,500) per qualified
employee per taxable year.
(3) The credit shall be allowed only for the first five years of
employment of the qualified employee by the qualified employer.
(b) For purposes of this section:
(1) "Full-time" means either:
(A) The employee is paid wages subject to Division 6 (commencing
with Section 13000) of the Unemployment Insurance Code for not less
than an average of 35 hours per week.
(B) The employee is salaried and was paid compensation during the
taxable year for full-time employment, within the meaning of Section
515 of the Labor Code.
(2) "Qualified employee" means a person who is employed by, or
contracts with, the qualified employer in a full-time position in the
state within one year of being awarded an undergraduate or graduate
degree from a program that has been accredited by the Engineering
Accreditation Commission of the Accreditation Board for Engineering
and Technology offered by a public or private college or university
accredited by a national accrediting body, for work in a qualified
industry and who was not employed by any qualified employer for work
in a qualified industry prior to his or her current employment or
contract.
(3) "Qualified employer" means a person or entity who is engaged
in a trade or business in a qualified industry.
(4) "Qualified industry" means the manufacture of aerospace or
defense hardware or software, aerospace maintenance, aerospace repair
and overhaul, parts supply to the aerospace industry, provision of
services and support relating to the aerospace industry, research and
development of aerospace technology and systems, and the education
and training of aerospace personnel.
(5) "Qualified wages" means wages subject to withholding tax
pursuant to Division 6 (commencing with Section 13000) of the
Unemployment Insurance Code paid to employee, salary, or other
remuneration. "Qualified wages" shall not include employer-provided
retirement, medical or health care benefits, reimbursement for
travel, meals, lodging, or any other expense.
(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 succeeding years if necessary, until the
credit is exhausted.
(d) (1) The Franchise Tax Board may prescribe rules, guidelines,
or procedures necessary or appropriate to carry out the purposes of
this section.
(2) Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code does not apply to any
standard, criterion, procedure, determination, rule, notice, or
guideline established or issued by the Franchise Tax Board pursuant
to this section.
SEC. 5. This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.
