Personal income tax: standard deduction: federal poverty level.
Vote required
Majority
Fiscal committee
No
Appropriation
No
Current location
Revenue and Taxation
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed Assembly
- Passed Senate
- To Governor
- Became Law
Overview
Assembly Bill 2591 proposes to change California’s personal income tax standard deduction. Starting July 1, 2027, taxpayers will be able to take a standard deduction equal to the federal poverty level, as adjusted for household size, instead of the current inflation-adjusted amount. This change aims to reduce the risk of individuals and families being taxed into poverty and simplify tax compliance. The bill takes effect immediately.
Key provisions
- The standard deduction will be equal to the federal poverty level for each household size.
- This change will apply starting July 1, 2027.
- The bill adjusts Section 17073.5 of the Revenue and Taxation Code.
- The Franchise Tax Board will publish the most recent federal poverty lines annually.
- The bill is intended to prevent individuals and families from being taxed into poverty.
- The standard deduction will be in lieu of other deductions.
- The bill is known as the Taxing Californians into Poverty Protection Act.
Who is affected
- California taxpayers
- Low-income individuals and families
- Taxpayers filing individual income tax returns
Notable changes
- Replaces the current inflation-adjusted standard deduction with the federal poverty level.
- Aligns California’s tax system with federal poverty guidelines.
Bill text
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Sponsors
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1 on record
Primary sponsor
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