AB 2950: Community Development Tax Credit Program: community development corporations: allocations: income taxation: credits.

The Personal Income Tax Law and the Corporation Tax Law, imposes Law impose taxes upon taxable income for the taxable year, as specified. The Personal Income Tax Law and the Corporation Tax Law specified, and allow various credits against the taxes imposed by those laws, including a low-income housing tax credit allocated by the California Tax Credit Allocation Committee. laws.

This bill would allow a credit against the taxes imposed under the Personal Income Tax Law and the Corporation Tax Law those taxes (CDC tax credit) for taxable years beginning on or after January 1, 2023, until January 1, 2028, in an amount equal to the applicable credit percentage of the amount of each qualified investment made by the taxpayer during the taxable year to an eligible community development corporation that is certified by the Treasurer to receive an allocation of tax credit pursuant to the Community Development Tax Credit Program established by this bill, if the aggregate amount of qualified investments made by the taxpayer in the taxable year is at least $100,000. This bill would limit the total amount of each credit that may be allowed each taxable year to $20,000,000.

This bill would establish establish, until January 1, 2028, the Community Development Tax Credit Program, which would be administered by the Treasurer in collaboration with the Department of Community Services and Development for the purpose of certifying CDC tax credit allocations to eligible community development corporations. The bill would allow an eligible community development corporation that is issued a certification to transfer its allocation of CDC tax credits to taxpayers who make qualified investments to that eligible community development corporation. The bill would require, on or before July 1, 2023, the Department of Community Services and Development to develop and provide forms for, and establish uniform procedures for the submission and review of, applications for an allocation of CDC tax credits to eligible community development corporations. The bill would require the Treasurer, among other things, to accept and evaluate applications in order to certify an allocation of CDC tax credits to an eligible community development corporation, and, beginning with the 2023 calendar year, allocate the CDC tax credits for a current calendar year, in an amount not to exceed $50,000,000 $20,000,000 per calendar year, among eligible community development corporations pursuant to specified criteria.

Existing law requires any bill authorizing a new tax expenditure, including a tax credit under the Personal Income Tax Law or the Corporation Tax Law, to contain, among other things, specific goals, purposes, and objectives the tax expenditure will achieve, detailed performance indicators, and data collection requirements.

This bill would state the intent of the Legislature to enact legislation that would comply with those new tax expenditure requirements. include that information and would declare the specific goal, purpose, and objective of the deduction is to incentivize private investment in housing, community facilities, and neighborhood revitalization through community development corporations, community development financial institutions, community action agencies, and community housing development corporations.

This bill would take effect immediately as a tax levy.