§ 17039.2. — 17039.2. (Amended by Stats. 2009, 3rd Ex. Sess., Ch. 17, Sec. 2.)

California § 17039.2.

• Jurisdiction: California
• Code RTC: Revenue and Taxation Code - RTC
• Div. 2.: DIVISION 2. OTHER TAXES
• Part 10.: PART 10. PERSONAL INCOME TAX
• Ch. 1.: CHAPTER 1. General Provisions and Definitions

Text

(a)
Notwithstanding any provision of this part or Part 10.2 (commencing with Section 18401) to the contrary, for each taxable year beginning on or after January 1, 2008, and before January 1, 2010, the total of all business credits otherwise allowable under any credit under any provision of Chapter 2 (commencing with Section 17041), including the carryover of any business credit under a former provision of that chapter, for the taxable year shall not reduce the “net tax” (as defined in Section 17039) below the applicable amount.
(b)
For purposes of this section, “business credit” means a credit allowable under any provision of Chapter 2 (commencing with Section 17041) other than the following credits:
(1)
The credit allowed by Section 17052.6 (relating to credit for household and dependent care).
(2)
The credit allowed by Section 17052.25 (relating to credit for adoption costs).
(3)
The credit allowed by Section 17053.5 (relating to renter’s tax credit).
(4)
The credit allowed by Section 17053.80 (relating to full time employment hiring credit).
(5)
The credit allowed by Section 17054 (relating to credit for personal exemption).
(6)
The credit allowed by Section 17054.5 (relating to credit for qualified joint custody head of household and a qualified taxpayer with a dependent parent).
(7)
The credit allowed by Section 17054.7 (relating to credit for senior head of household).
(8)
The credit allowed by Section 17061 (relating to refunds pursuant to the Unemployment Insurance Code).
(c)
For purposes of this section, the “applicable amount” shall be equal to 50 percent of the “net tax” (as defined in Section 17039) before application of any credits.
(d)
The amount of any credit otherwise allowable for the taxable year under Section 17039 that is not allowed due to application of this section shall remain a credit
carryover amount under this part.
(e)
The carryover period for any credit that is not allowed due to the application of this section shall be increased by the number of taxable years the credit (or any portion thereof) was not allowed.
(f)
Notwithstanding anything to the contrary in this part or Part 10.2 (commencing with Section 18401) the credits listed in subdivision (b) shall be required to be applied before any business credits, as limited by subdivision (a), are applied.
(g)
The provisions of this section shall not apply to a taxpayer with net business income of less than five hundred thousand dollars ($500,000) for the taxable year. For purposes of this subdivision, business income means:
(1)
Income from a trade or business, whether conducted by
the taxpayer or by a pasthrough entity owned directly or indirectly by the taxpayer. For purposes of this paragraph, the term “passthrough entity” means a partnership or an “S” corporation.
(2)
Income from rental activity.
(3)
Income attributable to a farming business.

Legislative History

Amended by Stats. 2009, 3rd Ex. Sess., Ch. 17, Sec. 2. Effective February 20, 2009.