BILL NUMBER: SB 49	AMENDED
	BILL TEXT

	AMENDED IN SENATE  JANUARY 6, 2010
	AMENDED IN SENATE  JUNE 9, 2009
	AMENDED IN SENATE  MAY 26, 2009
	AMENDED IN SENATE  MAY 6, 2009
	AMENDED IN SENATE  APRIL 14, 2009

INTRODUCED BY   Senators Dutton and Padilla
   (Coauthors: Senators Aanestad, Benoit, Cedillo, Cogdill, Denham,
Harman, Huff, Maldonado, Strickland, Walters, and Wyland)

                        JANUARY 13, 2009

   An act to amend Section 17059 of the Revenue and Taxation Code,
relating to taxation, to take effect immediately, tax levy.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 49, as amended, Dutton. Income tax credit: qualified principal
residence.
   The Personal Income Tax Law authorizes various credits against the
taxes imposed by that law. Existing law authorizes a credit against
those taxes in an amount equal to the lesser of 5% of the purchase
price of a qualified principal residence, as defined, purchased on
and after March 1, 2009, and before March 1, 2010, or $10,000,
allocated by the Franchise Tax Board on a first-come-first-served
basis. Existing law requires a taxpayer to provide the Franchise Tax
Board with a certification from the seller of the qualified principal
residence that the residence has never been previously occupied
within one week of the sale of the residence and caps the total
amount of the credit at $100,000,000.
   This bill would  provide that   allow 
the tax credit  is authorized  for purchases of a
qualified principal residence made before  December 1, 2010
  the date that is 12 months after the effective date of
this bill  , subject to specified restrictions. This bill would
revise the certification requirements to provide that the taxpayer
receive the certification no later than one week after the close of
escrow on the qualified principal residence and that the Franchise
Tax Board be provided with the certification upon request by the
board. This bill would also remove the cap on the total credit amount
allowed and the requirement that the tax credits be allocated on a
first-come-first-served basis.
   This bill would take effect immediately as a tax levy.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 17059 of the Revenue and Taxation Code is
amended to read:
   17059.  (a) (1) In the case of any taxpayer who purchases a
qualified principal residence on and after March 1, 2009, and before
 December 1, 2010  the date that is 12 months
after the effective date of the act amending this paragraph  ,
there shall be allowed as a credit against the "net tax," as defined
by Section 17039, an amount equal to the lesser of 5 percent of the
purchase price of the qualified principal residence or ten thousand
dollars ($10,000). The purchase of a qualified principal residence
that occurs on and after March 1, 2010, and before  December
1, 2010   the date that is 12 months after the effective
date of the act amending this paragraph  , must be made
pursuant to an enforceable contract to purchase the qualified
principal residence that is executed prior to March 1, 2010.
   (2) The amount of any credit allowed under paragraph (1) shall be
applied in equal amounts over the three successive taxable years
beginning with the taxable year in which the purchase of the
qualified principal residence is made.
   (3) The credit under this section shall be allowed for the
purchase of only one qualified principal residence with respect to
any taxpayer.
   (b) (1) For purposes of this section, "qualified principal
residence" means a single-family residence, whether detached or
attached, that has never been occupied, that is purchased to be the
principal residence of the taxpayer for a minimum of two years and is
eligible for the homeowner's exemption under Section 218.
   (2) No credit shall be allowed under this section unless the
taxpayer receives a certification from the seller of the qualified
principal residence that the residence has never been previously
occupied. The seller shall provide the certification to the taxpayer
no later than one week after the close of escrow of the qualified
principal residence. The taxpayer shall retain the certification and
provide it to the Franchise Tax Board upon request.
   (3) If the taxpayer does not occupy the qualified principal
residence as his or her principal residence for at least two years
immediately following the purchase the credit shall be canceled, and
the taxpayer shall be liable for any credit allowed under this
section on previous tax returns.
   (c) (1) In the case of two married taxpayers filing separately,
the credit allowed under subdivision (a) shall be equally apportioned
between the two taxpayers.
   (2) If two or more taxpayers who are not married purchase a
qualified principal residence, the amount of the credit allowed under
subdivision (a) shall be allocated among the taxpayers in the same
manner as each taxpayer's percentage of ownership, except that the
total amount of the credits allowed to all of these taxpayers shall
not exceed ten thousand dollars ($10,000).
   (d) The Franchise Tax Board may prescribe rules, guidelines, or
procedures necessary or appropriate to carry out the purposes of this
section, including any guidelines regarding the allocation of the
credit allowed under this section. Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code does not apply to any rule, guideline, or procedure prescribed
by the Franchise Tax Board pursuant to this section.
   (e) The credit allowed by this section is not a business credit
within the meaning of Section 17039.2.
   (f) The amendments made to this section by the act adding this
subdivision shall apply to purchases that occur on or after March 1,
2009, and before  December 1, 2010   the date
that is 12 months after the effective date of the act amending this
paragraph  .
   (g) This section shall remain in effect only until December 1,
2013, and as of that date is repealed, unless a later enacted
statute, that is enacted before December 1, 2013, deletes or extends
that date.
  SEC. 2.  This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.