Income tax credit: sales and use tax paid: natural disasters.
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Majority
Fiscal committee
No
Appropriation
No
Current location
Appropriations
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed Senate
- Passed Assembly
- To Governor
- Became Law
Overview
This bill creates a state income tax credit for California taxpayers who have suffered damage to their primary residences due to natural disasters. The credit covers sales tax and use tax paid on qualified tangible personal property purchased to rebuild the residence, as well as use tax paid for related items. It’s available for taxpayers beginning in 2027 and through 2031, with a maximum credit of $4,000 per year, subject to income limitations. The bill also includes requirements for data collection and performance indicators to assess the credit's effectiveness.
Key provisions
- Allows a credit against income tax for sales and use tax paid on qualified tangible personal property used to rebuild a primary residence damaged by a natural disaster.
- Defines ‘qualified tangible personal property’ including major appliances, residential furniture, and building supplies.
- Limits the credit to a maximum of $4,000 per year.
- Imposes income limitations on the credit amount, reducing it for higher-income taxpayers.
- Establishes a covered period for the credit, starting from the date of the natural disaster and ending three years later.
- Requires the Franchise Tax Board to adopt regulations to implement the credit.
- Includes performance indicators and reporting requirements to evaluate the credit’s effectiveness.
- Specifies that the credit is in lieu of other applicable credits.
Who is affected
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