AB180 - Taxation trailer bill.

Amended IN Senate June 26, 2026 CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION Assembly Bill No. 180 Introduced by Assembly Member Gabriel Committee on Budget (Assembly Members Gabriel (Chair), Addis, Ahrens, Alvarez, Bennett, Bonta, Caloza, Connolly, Fong, Haney, Hart, Jackson, Lee, Ortega, Patel, Petrie-Norris, Quirk-Silva, Ramos, Rogers, Schiavo, Schultz, Sharp-Collins, Solache, Stefani, Ward, and Wilson) January 08, 2025 An act relating to the Budget Act of 2025. An act to amend Section 16180 of the Government Code, to amend Sections 17059.2, 17140.4, 17941, 23689, and 23711.4 of, and to add Sections 17151.1, 17151.2, and 17509.5 to, the Revenue and Taxation Code, and to amend Section 4879 of the Welfare and Institutions Code, relating to taxation, and making an appropriation therefor, to take effect immediately, bill related to the budget. LEGISLATIVE COUNSEL'S DIGEST AB 180, as amended, Committee on Budget. Budget Act of 2025. Taxation trailer bill. (1) Existing law, the Senior Citizens Manufactured Home Property Tax Postponement Law (manufactured home law), authorizes a claimant, as defined, to file with the Controller a claim for postponement of a sum equal to but not exceeding the amount of property taxes for the fiscal year for which the claim is made. Existing law also establishes the Senior Citizens and Disabled Citizens Property Tax Postponement Fund and continuously appropriates moneys in that fund to the Controller for specified purposes relating to the postponement of property taxes pursuant to specified law, including the manufactured home law. Existing law requires the Controller, on June 30, 2018, and June 30 of each year thereafter, to transfer any moneys in the fund in excess of $15,000,000 to the General Fund and further requires that, on July 1, 2019, and July 1 of each year thereafter, up to 1% of the amount available in the fund be available for disbursements for manufactured home property tax postponements under the manufactured home law. This bill, beginning July 1, 2026, would increase the amount available on July 1 of each year for manufactured home property tax postponement disbursements from the above-described fund to $300,000. By increasing the limit to the amounts available for disbursement from the Senior Citizens and Disabled Citizens Property Tax Postponement Fund for property tax postponements under the manufactured home law, the bill would make an appropriation. (2) The Personal Income Tax Law and the Corporation Tax Law allow a credit (CalCompetes tax credit) against the taxes imposed under those laws, for each taxable year beginning on and after January 1, 2014, and before January 1, 2030, in an amount as provided in a written agreement between the Governor’s Office of Business and Economic Development and the taxpayer, approved by the California Competes Tax Credit Committee, and based on specified factors, including the number of jobs the taxpayer will create or retain in the state and the amount of investment in the state by the taxpayer. This bill would extend the CalCompetes tax credit through taxable years beginning before January 1, 2035. The bill would also make conforming changes. (3) Existing law, the Personal Income Tax Law, generally conforms to federal tax law through January 1, 2025, including conforming to federal law in its treatment of deferred compensation, except as otherwise provided. Existing federal law, Public Law 119-21, enacted July 4, 2025, provides for a tax-deferred investment account for children known as a 530A account. This bill, for taxable years beginning on or after January 1, 2026, would generally conform to federal law in its treatment of 530A accounts, except as specified. (4) The Personal Income Tax Law, in modified conformity with federal income tax laws, generally defines “gross income” as income from whatever source derived, except as specifically excluded, and provides various exclusions from gross income. Public Law 119-21 provides for gross income exclusions for employer contributions and qualified general contributions to a 530A account, as specified. This bill, for taxable years beginning on or after January 1, 2026, would conform to those gross income exclusions for purposes of the Personal Income Tax Law. (5) Existing federal and state law provide for the creation of ABLE accounts for the purpose of meeting the qualified disability expenses of a beneficiary and exclude these accounts from gross income. Existing federal and state law limit contributions to ABLE accounts to those made in cash, as a change in designated beneficiary, or as a qualified rollover contribution. Public Law 119-21 includes within those qualified rollover contributions specified rollover contributions from a 530A account. Existing law imposes limits on the amount of contributions that can be made to an ABLE Account and requires an ABLE program to provide adequate safeguards to prevent contributions in excess of that limit. Public Law 119-21 exempts from that requirement qualified rollover contributions from a 530A account. The Personal Income Tax Law and the Corporation Tax Law, for taxable years beginning on or after January 1, 2016, generally conform to federal law relating to qualified ABLE programs prior to Public Law 119-21. This bill, for taxable years beginning on or after January 1, 2026, would conform to the above-described changes to qualified ABLE programs relating to 530A accounts made by Public Law 119-21 for purposes of the Personal Income Tax Law and the Corporation Tax Law. The bill would also make conforming changes relating to the requirements for making contributions to an ABLE account. (6) Existing law imposes an annual minimum franchise tax of $800, except as provided, on every corporation incorporated in this state, qualified to transact intrastate business in this state, or doing business in this state, and an annual tax in an amount equal to the minimum franchise tax, except as provided, on every limited partnership, limited liability partnership, and limited liability company doing business in this state, as specified. This bill, for taxable years beginning on or after January 1, 2027, and before January 1, 2030, would reduce the amount of the annual tax imposed on a limited liability company doing business in this state from $800 to $400 for the company’s first taxable year. This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill. This bill would express the intent of the Legislature to enact statutory changes relating to the Budget Act of 2025. Digest Key Vote: MAJORITY Appropriation: NO YES Fiscal Committee: NO YES Local Program: NO Bill Text The people of the State of California do enact as follows: SECTION 1. Section 16180 of the Government Code is amended to read: 16180. (a) There is hereby created in the State Treasury a Senior Citizens and Disabled Citizens Property Tax Postponement Fund. The fund shall be an interest-bearing fund. Subject to subdivision (b) and notwithstanding Section 13340, the fund is continuously appropriated to the Controller, commencing January 1, 2015, for purposes of administering this chapter, including, but not limited to, necessary administrative costs and disbursements relating to the postponement of property taxes pursuant to Chapter 2 (commencing with Section 20581), Chapter 3 (commencing with Section 20625), Chapter 3.3 (commencing with Section 20639), and Chapter 3.5 (commencing with Section 20640) of Part 10.5 of Division 2 of the Revenue and Taxation Code. (b) The Controller shall do all of the following: (1) On June 30, 2017, transfer any moneys in the fund in excess of twenty million dollars ($20,000,000) to the General Fund. (2) On June 30, 2018, and on June 30 each year thereafter, transfer any moneys in the fund in excess of fifteen million dollars ($15,000,000) to the General Fund. (3) (A) On July 1, 2019, and on July 1 of each year thereafter, before January 1, 2026, up to 1 percent of the amount available in the fund for disbursements relating to the postponement of property taxes shall be available for residential dwellings that are manufactured homes pursuant to Chapter 3.3 (commencing with Section 20639). 20639) of Part 10.5 of Division 2 of the Revenue and Taxation Code. (B) On July 1, 2026, and on July 1 each year thereafter, up to three hundred thousand dollars ($300,000) of the amount available in the fund for disbursements relating to the postponement of property taxes shall be available for residential dwellings that are manufactured homes pursuant to Chapter 3.3 (commencing with Section 20639) of Part 10.5 of Division 2 of the Revenue and Taxation Code. (c) On or after January 1, 2015, any loan repayments relating to the Senior Citizens and Disabled Citizens Property Tax Postponement Law shall be deposited into the Senior Citizens and Disabled Citizens Property Tax Postponement Fund. SEC. 2. Section 17059.2 of the Revenue and Taxation Code is amended to read: 17059.2. (a) (1) For each taxable year beginning on and after January 1, 2014, and before January 1, 2030, 2035, there shall be allowed as a credit against the “net tax,” as defined in Section 17039, an amount as determined by the committee pursuant to paragraph (2) and approved pursuant to Section 18410.2. (2) The credit under this section shall be allocated by GO-Biz with respect to the 2013–14 fiscal year through and including the 2027–28 2032–33 fiscal year. The amount of credit allocated to a taxpayer with respect to a fiscal year pursuant to this section shall be as set forth in a written agreement between GO-Biz and the taxpayer and shall be based on the following factors: (A) The number of jobs the taxpayer will create or retain in this state. (B) The compensation paid or proposed to be paid by the taxpayer to its employees, including wages and fringe benefits. (C) The amount of investment in this state by the taxpayer. (D) The extent of unemployment or poverty in the area according to the United States Census in which the taxpayer’s project or business is proposed or located. (E) The incentives available to the taxpayer in this state, including incentives from the state, local government, and other entities. (F) The incentives available to the taxpayer in other states. (G) The duration of the proposed project and the duration the taxpayer commits to remain in this state. (H) The overall economic impact in this state of the taxpayer’s project or business. (I) The strategic importance of the taxpayer’s project or business to the state, region, or locality. (J) The opportunity for future growth and expansion in this state by the taxpayer’s business. (K) The extent to which the anticipated benefit to the state exceeds the projected benefit to the taxpayer from the tax credit. (L) For a credit allocated beginning with the 2018–19 fiscal year, the training opportunities offered by the taxpayer to its employees. (3) The written agreement entered into pursuant to paragraph (2) shall include: (A) Terms and conditions that include the taxable year or years for which the credit allocated shall be allowed, a minimum compensation level, and a minimum job retention period. (B) Provisions indicating whether the credit is to be allocated in full upon approval or in increments based on mutually agreed upon milestones when satisfactorily met by the taxpayer. (C) Provisions that allow the committee to recapture the credit, in whole or in part, if the taxpayer fails to fulfill the terms and conditions of the written agreement. (b) For purposes of this section: (1) “Committee” means the California Competes Tax Credit Committee established pursuant to Section 18410.2. (2) “GO-Biz” means the Governor’s Office of Business and Economic Development. (c) For purposes of this section, GO-Biz shall do the following: (1) Give priority to a taxpayer whose project or business is located or proposed to be located in an area of high unemployment or poverty. (2) Negotiate with a taxpayer the terms and conditions of proposed written agreements that provide the credit allowed pursuant to this section to a taxpayer. (3) Provide the negotiated written agreement to the committee for its approval pursuant to Section 18410.2. (4) Inform the Franchise Tax Board of the terms and conditions of the written agreement upon approval of the written agreement by the committee. (5) Inform the Franchise Tax Board of any recapture, in whole or in part, of a previously allocated credit upon approval of the recapture by the committee. (6) Post on its internet website all of the following: (A) The name of each taxpayer allocated a credit pursuant to this section. (B) The estimated amount of the investment by each taxpayer. (C) The estimated number of jobs created or retained. (D) The amount of the credit allocated to the taxpayer. (E) The amount of the credit recaptured from the taxpayer, if applicable. (F) The primary location where the taxpayer has committed to increasing the net number of jobs or make investments. The primary location shall be listed by city or, in the case of unincorporated areas, by county. (G) Information that identifies each tax credit award that was given a priority for being located in a high unemployment or poverty area, pursuant to paragraph (1). (7) Consider the extent to which the credit will influence the taxpayer’s ability, willingness, or both, to create jobs in this state that might not otherwise be created in the state by the taxpayer or any other taxpayer. GO-Biz may also consider other factors, including, but not limited to, the following: (A) The financial solvency of the taxpayer and the taxpayer’s ability to finance its proposed expansion. (B) The taxpayer’s current and prior compliance with federal and state laws. (C) Current and prior litigation involving the taxpayer. (D) The reasonableness of the fee arrangement between the taxpayer and any third party providing any services related to the credit allowed pursuant to this section. (E) For allocation periods beginning with the 2023–24 fiscal year, the taxpayer’s willingness to relocate jobs into California from a state that has enacted a law that does any of the following: (i) Voids or repeals, or has the effect of voiding or repealing, existing state protections against discrimination on the basis of sexual orientation, gender identity, or gender expression. (ii) Authorizes or requires discrimination against same-sex couples or their families, or discrimination on the basis of sexual orientation, gender identity, or gender expression. (iii) Creates an exemption to antidiscrimination laws in order to permit discrimination against same-sex couples or their families, or permits discrimination on the basis of sexual orientation, gender identity, or gender expression. (iv) Denies or interferes with, or has the effect of denying or interfering with, a woman’s right to choose to bear a child or to ch [Text truncated for display. Full text available on Congress.gov.]