Personal income tax: employment credit.
Vote required
Majority
Fiscal committee
No
Appropriation
No
Current location
Pending Referral
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed Assembly
- Passed Senate
- To Governor
- Became Law
Overview
This bill makes a technical change to California’s personal income tax law, specifically regarding an employment credit available to businesses that hire full-time employees in designated census tracts or economic development areas. The existing credit, which was initially established in 2014, allows qualified taxpayers to receive a percentage of the wages paid to those employees. This bill clarifies the requirements for claiming the credit, particularly regarding the designation of these areas and the application of the credit to certain types of businesses, including those involved in semiconductor manufacturing, lithium production, and electric airplane manufacturing.
Key provisions
- Increases the percentage of qualified wages eligible for the employment credit to 35%.
- Clarifies the requirements for designated census tracts and economic development areas.
- Addresses relocation of employees to designated areas, requiring a written offer of employment at the new location.
- Specifies that the credit is only available on a timely filed return and for qualified full-time employees with a tentative credit reservation.
- Adds new categories of businesses (semiconductor, lithium, electric airplanes) eligible for the credit.
- Defines ‘qualified taxpayer’ to include these new business categories.
- Establishes a process for the Franchise Tax Board to provide a searchable database of credit claims.
- Includes provisions related to the termination of employment and potential recapture of the credit.
Who is affected
Bill text
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Sponsors
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1 on record
Primary sponsor
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