20250AB__042998AMD INTRODUCED 2025-02-05 AMENDED_ASSEMBLY 2025-05-08 2025 AB AMD Introduced by Assembly Member Hadwick (Coauthor: Assembly Member Lackey) (Coauthor: Senator Dahle) LEAD_AUTHOR ASSEMBLY Hadwick COAUTHOR ASSEMBLY Lackey COAUTHOR SENATE Dahle

An act to add and repeal Sections 17139.8 and 24309.9 of the Revenue and Taxation Code, relating to taxation, and declaring the urgency thereof, to take effect immediately. taxation, and declaring the urgency thereof, to take effect immediately Personal Income Tax Law: Corporation Tax Law: exclusions: wildfires. The Personal Income Tax Law and the Corporation Tax Law, in conformity with federal income tax law, generally defines gross income as income from whatever source derived, except as specifically excluded, and provides various exclusions from gross income.

This bill, for taxable years beginning on or after January 1, 2022, and before January 1, 2027, would provide an exclusion from gross income for amounts received by a qualified taxpayer, as defined, in settlement for costs and losses associated with the Dixie Fire in the Counties of Butte, Plumas, Lassen, Shasta, and Tehama, or the Mill Fire in the County of Siskiyou, as provided. Existing law requires a bill authorizing a new tax expenditure 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 include additional information required for any bill authorizing a new tax expenditure. The bill would make legislative findings and declarations related to a gift of public funds. This bill would declare that it is to take effect immediately as an urgency statute.

TWO_THIRDS NO YES NO YES YES NO NO NO NO NO The people of the State of California do enact as follows: <caml:Num>SECTION 1.</caml:Num><caml:ActionLine action="IS_ADDED" xlink:href="urn:caml:codes:RTC:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2F%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'17139.8'%5D)" xlink:label="fractionType: LAW_SECTION" xlink:type="locator">Section 17139.4 is added to the <caml:DocName>Revenue and Taxation Code</caml:DocName>, to read:</caml:ActionLine><caml:Fragment><caml:LawSection id="id_6C504BF9-C0B5-40A8-81D2-7DF299F3A0FA"><caml:Num>17139.4.</caml:Num><caml:LawSectionVersion id="id_A6141A02-A01C-49A7-A3FF-38DC84E92E6C"><caml:Content/></caml:LawSectionVersion></caml:LawSection></caml:Fragment></caml:BillSection>"?>

SECTION

Section 17139.8 is added to the Revenue and Taxation Code , to read: 17139.8. (

a) For taxable years beginning on or after January 1, 2022, and before January 1, 2027, gross income does not include any qualified amount received by a qualified taxpayer. (

b) For purposes of this section: (1) “Qualified amount” means any amount received in settlement by a qualified taxpayer from a settlement entity in connection with any of the following: (

A) The Dixie Fire. (

B) The Mill Fire. (C)<xhtml:span class="EnSpace"/>The Park Fire.</xhtml:p>"?> (2) “Qualified taxpayer” means any of the following: (

A) In relation to the Dixie Fire, the following: (

i) Any taxpayer that owned real property located in the County of Butte, Plumas, Lassen, Shasta, or Tehama during the Dixie Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Dixie Fire. (ii) Any taxpayer that resided within the County of Butte, Plumas, Lassen, Shasta, or Tehama during the Dixie Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Dixie Fire. (iii) Any taxpayer that had a place of business within the County of Butte, Plumas, Lassen, Shasta, or Tehama during the Dixie Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Dixie Fire. (

B) In relation to the Mill Fire, the following: (

i) Any taxpayer that owned real property located in the County of Siskiyou during the Mill Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Mill Fire. (ii) Any taxpayer that resided within the County of Siskiyou during the Mill Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Mill Fire. (iii) Any taxpayer that had a place of business within the County of Siskiyou during the Mill Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Mill Fire. (C)<xhtml:span class="EnSpace"/>In relation to the Park Fire, the following:</xhtml:p><xhtml:p>(i)<xhtml:span class="EnSpace"/>Any taxpayer that owned real property located in the County of Butte or Tehama during the Park Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Park Fire.</xhtml:p><xhtml:p>(ii)<xhtml:span class="EnSpace"/>Any taxpayer that resided within the County of Butte or Tehama during the Park Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Park Fire.</xhtml:p><xhtml:p>(iii)<xhtml:span class="EnSpace"/>Any taxpayer that had a place of business within the County of Butte or Tehama during the Park Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Park Fire.</xhtml:p>"?> (3) “Settlement entity” means the following: (

A) In relation to the Dixie Fire, Pacific Gas and Electric Company or its subsidiary making the settlement payment to a qualified taxpayer. (

B) In relation to the Mill Fire, Roseburg Forest Products or its subsidiary or agent making the settlement payment to a qualified taxpayer. (C)<xhtml:span class="EnSpace"/>In relation to the Park Fire, an entity, approved by a class action settlement administrator, making a settlement payment related to the Park Fire to a qualified taxpayer.</xhtml:p>"?> (

c) The settlement entity shall provide, upon request by the Franchise Tax Board, documentation of the settlement payments in the form and manner requested by the Franchise Tax Board. (d)

(1) For the purpose of complying with

Section in regards to the exclusion provided by this

section and

Section 24309.9, the Legislature finds and declares as follows: (

A) The specific goal, purpose, and objective of the tax exclusion is to provide essential relief to individuals who have suffered injury, loss, inconvenience, and expenses resulting from the devastating Dixie Fire or Mill Fire. (

B) The performance indicators for the Legislature to use in determining if the exclusion achieves the stated goal, purpose, and objective shall be the number of qualified taxpayers that excluded qualified amounts from gross income, and the aggregate amount of settlement payments arising out of the Dixie Fire or Mill Fire. (2) (

A) On December 1, 2027, the Franchise Tax Board shall deliver to the Legislature a written report that includes both of the following: (

i) To the extent feasible, the number of qualified taxpayers that excluded qualified amounts from gross income, as a result of the exclusion. (ii) The aggregate amount of those settlement payments arising out of the Dixie Fire or Mill Fire. (

B) The report required by this paragraph shall be delivered to the Legislature in compliance with

Section of the Government Code. (

C) The disclosure provisions of this subdivision shall be treated as an exception to

Section 19542. (

e) This

section shall remain in effect only until December 1, 2027, and as of that date is repealed. <caml:Num>SEC. 2.</caml:Num><caml:ActionLine action="IS_ADDED" xlink:href="urn:caml:codes:RTC:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2F%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'24309.9'%5D)" xlink:label="fractionType: LAW_SECTION" xlink:type="locator">Section 24309.8 is added to the <caml:DocName>Revenue and Taxation Code</caml:DocName>, to read:</caml:ActionLine><caml:Fragment><caml:LawSection id="id_A505884B-49F0-4441-AE83-D4A558CDCB4E"><caml:Num>24309.8.</caml:Num><caml:LawSectionVersion id="id_4F010CF8-2CA8-43D9-815F-999A9311CB41"><caml:Content/></caml:LawSectionVersion></caml:LawSection></caml:Fragment></caml:BillSection>"?>

SEC.

Section 24309.9 is added to the Revenue and Taxation Code , to read: 24309.9. (

a) For taxable years beginning on or after January 1, 2022, and before January 1, 2027, gross income does not include any qualified amount received by a qualified taxpayer. (

b) For purposes of this section: (1) “Qualified amount” means any amount received in settlement by a qualified taxpayer from a settlement entity in connection with any of the following: (

A) The Dixie Fire. (

B) The Mill Fire. (C)<xhtml:span class="EnSpace"/>The Park Fire.</xhtml:p>"?> (2) “Qualified taxpayer” means any of the following: (

A) In relation to the Dixie Fire, the following: (

i) Any taxpayer that owned real property located in the County of Butte, Plumas, Lassen, Shasta, or Tehama during the Dixie Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Dixie Fire. (ii) Any taxpayer that had a place of business within the County of Butte, Plumas, Lassen, Shasta, or Tehama during the Dixie Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Dixie Fire. (

B) In relation to the Mill Fire, the following: (

i) Any taxpayer that owned real property located in the County of Siskiyou during the Mill Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Mill Fire. (ii) Any taxpayer that had a place of business within the County of Siskiyou during the Mill Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Mill Fire. (C)<xhtml:span class="EnSpace"/>In relation to the Park Fire, the following:</xhtml:p><xhtml:p>(i)<xhtml:span class="EnSpace"/>Any taxpayer that owned real property located in the County of Butte or Tehama during the Park Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Park Fire.</xhtml:p><xhtml:p>(ii)<xhtml:span class="EnSpace"/>Any taxpayer that had a place of business within the County of Butte or Tehama during the Park Fire that paid or incurred expenses and received amounts from a settlement arising out of or pursuant to the Park Fire.</xhtml:p>"?> (3) “Settlement entity” means the following: (

A) In relation to the Dixie Fire, Pacific Gas and Electric Company or its subsidiary making the settlement payment to a qualified taxpayer. (

B) In relation to the Mill Fire, Roseburg Forest Products or its subsidiary or agent making the settlement payment to a qualified taxpayer. (C)<xhtml:span class="EnSpace"/>In relation to the Park Fire, _____ (entity) or its subsidiary or agent making the settlement payment to a qualified taxpayer.</xhtml:p>"?> (

c) The settlement entity shall provide, upon request by the Franchise Tax Board, documentation of the settlement payments in the form and manner requested by the Franchise Tax Board. (

d) This

section shall remain in effect only until December 1, 2027, and as of that date is repealed.

SEC. 3. The Legislature finds and declares that Sections 17139.4 and 24309.8 of the Revenue and Taxation Code, as added by this act, are necessary for the public purpose of preventing undue hardship to taxpayers who reside, or used to reside, in a part of California devastated by fire, and do not constitute a gift of public funds within the meaning of

Section of

Article XVI of the California Constitution.

SEC. 4. This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of

Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are: In order to provide essential relief to those persons who have suffered injury, loss, inconvenience, and expenses resulting from the devastating Dixie Fire or Mill Fire, as soon as possible, it is necessary that this act take effect immediately.