Bill Text: CA AB458 | 2013-2014 | Regular Session | Introduced

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Bill Title: Income taxes: deductions: punitive damages.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Engrossed - Dead) 2013-09-12 - Ordered to inactive file at the request of Senator Padilla. [AB458 Detail]

Download: California-2013-AB458-Introduced.html

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BILL NUMBER: AB 458	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Wieckowski

                        FEBRUARY 19, 2013

   An act to add Sections 17226 and 24343.4 to the Revenue and
Taxation Code, relating to taxation, to take effect immediately, tax
levy.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 458, as introduced, Wieckowski. Income taxes: deductions:
punitive damages.
   The Personal Income Tax Law and the Corporation Tax Law allow
various deductions in computing the income that is subject to the
taxes imposed by those laws. Both laws allow a deduction for ordinary
and necessary business expenses, including a deduction for amounts
paid or incurred for specified types of punitive damages.
   This bill, for taxable years beginning on or after January 1,
2014, would disallow, under both laws, a deduction for amounts paid
or incurred for punitive damages, as provided.
   This bill would include a change in state statute that would
result in a taxpayer paying a higher tax within the meaning of
Section 3 of Article XIII A of the California Constitution, and thus
would require for passage the approval of 2/3 of the membership of
each house of the Legislature.
    This bill would take effect immediately as a tax levy.
   Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


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

  SECTION 1.  Section 17226 is added to the Revenue and Taxation
Code, to read:
   17226.  For taxable years beginning on or after January 1, 2014, a
deduction shall not be allowed for any amount paid or incurred for
punitive damages in connection with any judgment in, or settlement
of, any action.
  SEC. 2.  Section 24343.4 is added to the Revenue and Taxation Code,
to read:
   24343.4.  For taxable years beginning on or after January 1, 2014,
a deduction shall not be allowed for any amount paid or incurred for
punitive damages in connection with any judgment in, or settlement
of, any action.
  SEC. 3.   This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.