Personal Income Tax Law: Corporation Tax Law: credit: childcare.
AB 2673
California Bills
20250AB__267399INT INTRODUCED 2026-02-20 2025 AB INT Introduced by Assembly Member Celeste Rodriguez LEAD_AUTHOR ASSEMBLY Celeste Rodriguez
An act to add and repeal Sections 17052.7 and of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy. taxation, to take effect immediately, tax levy Personal Income Tax Law: Corporation Tax Law: credit: childcare. The Personal Income Tax Law and the Corporation Tax Law allow various credits against the taxes imposed by those laws. This bill would allow a credit against those taxes for each taxable year beginning on or after January 1, 2027, and before January 1, 2032, in an amount equal to 50% of qualified contributions to promote childcare, up to $100,000, as specified.
Existing law requires any bill authorizing a new tax expenditure, as defined, to include tax credits, to contain, among other things, specific goals, purposes, and objectives that the tax credit will achieve, detailed performance indicators, and data collection requirements. This bill would include findings and reporting requirements in compliance with this requirement. This bill would take effect immediately as a tax levy. MAJORITY NO YES NO YES NO YES NO NO NO NO The people of the State of California do enact as follows:
SECTION
Section 17052.7 is added to the Revenue and Taxation Code , to read: 17052.7. (
a) For each taxable year beginning on or after January 1, 2027, and before January 1, 2032, there shall be allowed as a credit against the “net tax,” as defined in
Section 17039, an amount equal to percent of qualified contributions to promote childcare during the taxable year, not exceed one hundred thousand dollars ($100,000) per taxpayer per taxable year. (
b) For purposes of this section, the following shall apply: (1) “Childcare” means care provided to a child years of age or younger. (2) “Qualified childcare facility” means a child day care facility as defined in
Section 1596.750 of the Health and Safety Code. (3) (A) “Qualified contributions to promote childcare” means any monetary contribution to promote childcare, including any of the following activities, and for which the taxpayer receives documentation from the recipient facility or program of the amount and purpose for the contribution: (
i) Donating money for the establishment or operation of a qualified childcare facility that uses the donation to provide childcare. (ii) Donating money to establish a grant or loan program for a parent or parents in this state requiring financial assistance for childcare. (iii) Pooling money of several businesses and donating the money for the establishment of a qualified childcare facility in this state. (iv) Donating money for the establishment of an information dissemination program in the state to provide information and referral services to assist a parent or parents in obtaining childcare. (B) “Qualified contributions to promote childcare” does not include any contribution that is not directly related to promoting childcare in the state or that a taxpayer makes to a childcare facility or program in which the taxpayer or a person related to the taxpayer has a financial interest. (c)
(1) In the case where the credit allowed by this
section exceeds the “net tax,” the excess may be carried over to reduce the “net tax” in the following taxable year, and the succeeding four years, if necessary, until the credit is exhausted.
(2) A taxpayer claiming the credit allowed by this
section shall submit the documentation described in subdivision (
A) of paragraph (3) of subdivision (
b) as prescribed by the Franchise Tax Board. (
d) The board may adopt rules and regulations as necessary to administer this section. (e)
(1) For purposes of complying with
Section 41, with respect to the credit allowed by this
section and
Section 23627, the Legislature finds and declares the specific goal, purpose, and objective of the credit is to generate funding for the purpose of early childcare programs and to assist those most in need of childcare.
(2) To measure whether the credit achieves the purpose described in paragraph (1), on or before July 1, 2029, and annually thereafter, the Franchise Tax Board shall prepare and submit a report to the Legislature, in compliance with
Section of the Government Code, containing all of the following: (
A) The number of taxpayers that have claimed the credit. (
B) The amount of each credit claimed and the total amount that was claimed per fiscal year. (
C) The top qualified childcare facilities or programs that received contributions for which a credit was claimed. (
D) A list of the types of facilities or programs that received contributions for which a credit was claimed.
(3) The disclosure provisions of this subdivision shall be treated as an exception to
Section 19542. (
f) This
section shall remain in effect only until December 1, 2033, and as of that date is repealed.
SEC. 2.
Section is added to the Revenue and Taxation Code , to read: 23627. (
a) For each taxable year beginning on or after January 1, 2027, and before January 1, 2032, there shall be allowed as a credit against the “tax,” as defined in
Section 23036, an amount equal to percent of qualified contributions to promote childcare during the taxable year, not exceed one hundred thousand dollars ($100,000) per taxpayer per taxable year. (
b) For purposes of this section, the following shall apply: (1) “Childcare” means care provided to a child years of age or younger. (2) “Qualified childcare facility” means a child day care facility as defined in
Section 1596.750 of the Health and Safety Code. (3) (A) “Qualified contributions to promote childcare” means any monetary contribution to promote childcare, including any of the following activities, and for which the taxpayer receives documentation from the recipient facility or program of the amount and purpose for the contribution: (
i) Donating money for the establishment or operation of a qualified childcare facility that uses the donation to provide childcare. (ii) Donating money to establish a grant or loan program for a parent or parents in this state requiring financial assistance for childcare. (iii) Pooling money of several businesses and donating the money for the establishment of a qualified childcare facility in this state. (iv) Donating money for the establishment of an information dissemination program in the state to provide information and referral services to assist a parent or parents in obtaining childcare. (B) “Qualified contributions to promote childcare” does not include any contribution that is not directly related to promoting childcare in the state or that a taxpayer makes to a childcare facility or program in which the taxpayer or a person related to the taxpayer has a financial interest. (c)
(1) In the case where the credit allowed by this
section exceeds the “tax,” the excess may be carried over to reduce the “net tax” in the following taxable year, and the succeeding four years, if necessary, until the credit is exhausted.
(2) A taxpayer claiming the credit allowed by this
section shall submit the documentation described in subdivision (
A) of paragraph (3) of subdivision (
b) as prescribed by the Franchise Tax Board. (
d) The board may adopt rules and regulations as necessary to administer this section. (
e) This
section shall remain in effect only until December 1, 2033, and as of that date is repealed.
SEC. 3. This act provides for a tax levy within the meaning of