AB 2833: Personal income taxes: renter’s credit.

Session Year: 2017-2018
House: Assembly

Version:

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 or less, as currently adjusted to $80,156, and in the amount of $60 for other individuals if adjusted gross income is $25,000 or less, as currently adjusted to $40,078.

This bill, for taxable years beginning on or after January 1, 2019, and before January 1, 2024, for spouses filing joint returns, heads of household, and surviving spouses with those adjusted gross incomes, would allow a credit equal to the greater of $120 or 20% of the median rent in the county where the premises are located at which the qualified renter rented and occupied as his or her principal place of residence for the longest period during the taxable year. The bill, for taxable years beginning on or after January 1, 2019, and before January 1, 2024, for other individuals with those adjusted gross incomes, would allow a credit equal to the greater of $60 or 10% of the median rent in the county where the premises are located at which the qualified renter rented and occupied as his or her principal place of residence for the longest period during the taxable year.

This bill, on or before January 1, 2020, and on or before January 1 each year thereafter, 1, 2025, would require the county assessor Department of Housing and Community Development to annually determine the median rent in the each county for the previous calendar year and to provide that data to the Franchise Tax Board. The bill, on or before January 31, 2020, and on or before January 31 each year thereafter, 31, 2025, would require the Franchise Tax Board, using that data provided, to annually calculate the amount of the credit allowed by county for each taxable year and to publish its determinations on its Internet Web site to notify taxpayers. By imposing a new duty on county assessors, this bill would impose a state-mandated local program.

Existing law establishes the continuously appropriated Tax Relief and Refund Account 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, 2019, if the amount allowable as a credit under this bill exceeds the tax liability computed under the Personal Income Tax Law for the taxable year, would require the excess to be credited against other amounts due, if any, and the balance, if any, upon appropriation by the Legislature, to be paid from the Tax Relief and Refund Account and refunded to the taxpayer.The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above.

This bill would take effect immediately as a tax levy.

Discussed in Hearing

Assembly Standing Committee on Revenue and Taxation

3MIN

Apr 30, 2018

Assembly Standing Committee on Revenue and Taxation

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Bill Author

Miguel Santiago

AB 2833: Personal income taxes: renter’s credit.

Assembly Standing Committee on Revenue and Taxation

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