SB 843

Bill Subjects

Abstract

The Personal Income Tax Law authorizes various credits against the taxes imposed by that law, including a credit for qualified renters in the amount of $120 for spouses filing joint returns, heads of household, and surviving spouses if adjusted gross income is $50,000, as adjusted, or less, and in the amount of $60 for other individuals if adjusted gross income is $25,000, as adjusted, or less. Existing law requires the Franchise Tax Board to annually adjust for inflation these adjusted gross income amounts. For 2020, the adjusted gross income limit is $87,066 and $43,533, respectively. Existing law requires any bill authorizing a new tax credit to contain, among other things, specific goals, purposes, and objectives that the tax credit will achieve, detailed performance indicators, and data collection requirements. Existing law establishes the continuously appropriated Tax Relief and Refund Account in the General Fund and provides that payments required to be made to taxpayers or other persons from the Personal Income Tax Fund are to be paid from that account. This bill, for taxable years beginning on or after January 1, 2022, and before January 1, 2027, and only when specified in a bill relating to the Budget Act, would increase the credit amount for a qualified renter to $1,000 for spouses filing joint returns, heads of households, and surviving spouses and $500 for other individuals, as provided. In the event the increased credit amount is not specified in a bill relating to the Budget Act, the existing credit amounts of $120 and $60, as described above, respectively, would be the credit amounts for that taxable year. The bill would require the Franchise Tax Board to annually recompute for inflation the credit amount for taxable years on or after January 1, 2023, and before January 1, 2027, except as provided. The bill would provide findings and declarations relating to the goals, purposes, and objectives of this credit. The bill, for credits allowable for taxable years beginning on or after January 1, 2022, and before January 1, 2027, would provide that the credit amount in excess of the qualified renter's liability would be refundable and paid from the Tax Relief and Refund Account to the qualified renter upon appropriation by the Legislature. This bill would take effect immediately as a tax levy.