JurisdictionCaliforniaCode RTCRevenue and Taxation Code - RTC
Div. 2.DIVISION 2. OTHER TAXES
Part 11.PART 11. CORPORATION TAX LAW
Ch. 3.5.CHAPTER 3.5. Tax Credits
This text of California § 23640. (23640. (Added by Stats. 2025, Ch. 119, Sec. 66.)) is published on Counsel Stack Legal Research, covering California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.
(a)For taxable years beginning on or after January 1, 2026, and before January 1, 2036, there shall be allowed to qualified taxpayer, a credit against the “tax,” as defined in Section 23036, in an amount equal to 20 percent of the qualified expenditures paid or incurred by the qualified taxpayer during the taxable year, not to exceed twenty million dollars ($20,000,000) per qualified taxpayer per taxable year.
(b)For purposes of this section:
(1)“Bank” means the California Infrastructure and Economic Development Bank established under Chapter 2 (commencing with Section 63021) of Division 1 of Title 6.7 of the Government Code.
(2)“Eligible transmission project” has the same meaning as defined in Section 63049.73 of the Government Code.
(3)“Qualified expenditures” means costs paid or in
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(a)
For taxable years beginning on or after January 1, 2026, and before January 1, 2036, there shall be allowed to qualified taxpayer, a credit against the “tax,” as defined in Section 23036, in an amount equal to 20 percent of the qualified expenditures paid or incurred by the qualified taxpayer during the taxable year, not to exceed twenty million dollars ($20,000,000) per qualified taxpayer per taxable year.
(b)
For purposes of this section:
(1)
“Bank” means the California Infrastructure and Economic Development Bank established under Chapter 2 (commencing with Section 63021) of Division 1 of Title 6.7 of the Government Code.
(2)
“Eligible transmission project” has the same meaning as defined in Section 63049.73 of the Government Code.
(3)
“Qualified expenditures” means costs paid or incurred for planning, design, engineering, permitting, construction, and equipment directly related to the eligible transmission project or qualified wages paid or incurred to employees of a qualified taxpayer that perform services directly related to the eligible transmission project.
(4)
“Qualified taxpayer” means a taxpayer that is a participating party, as defined in subdivision (h) of section 63049.71 of the Government Code.
(5)
“Qualified wages” means wages subject to withholding under Division 6 (commencing with Section 13000) of the Unemployment Insurance Code.
(c)
In the
case where the credit allowed by this section exceeds the “tax,” the excess may be carried over to reduce the “tax” in the following taxable year, and succeeding seven years if necessary, until the credit is exhausted.
(d)
If the credit allowed by this section is claimed by the qualified taxpayer, a deduction otherwise allowed under this part for any amount of qualified expenditures paid or incurred by the qualified taxpayer shall be reduced by the amount of the qualified expenditures taken into account in calculating the credit allowed by this section.
(e)
If the credit allowed by this section is claimed by the qualified taxpayer, the taxpayer shall not earn a return on equity for the eligible transmission project pursuant to Article 10.5 (commencing with Section 63049.71) of Chapter 2 of Division 1 of Title 6.7 of the Government Code for the portion of the project for which the
credit is claimed.
(f)
The bank shall inform the Franchise Tax Board of any eligible transmission project that the bank approves for financial assistance pursuant to subdivision (i) of Section 63049.73 of the Government Code and shall provide any other information the Franchise Tax Board requires for administration of the credit allowed by this section.
(g)
The Franchise Tax Board may prescribe regulations that are necessary or appropriate to carry out the purposes of this section.
(h)
Section 41 shall not apply to this section.
(i)
This section shall remain in effect only until December 1, 2036, and as of that date is repealed.