SB 302: Personal Income Tax Law and Corporation Tax Law: exclusions: environmental credits.

Official summary

Legislative Counsel’s Digest (official, as of the latest version). Written by nonpartisan legislative staff; reproduced verbatim.

Existing law, 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. Existing federal law authorizes an applicable entity, as defined, to receive a refund for specified environmental credits against the taxes imposed under federal law and excludes a refund payment made pursuant to that law from gross income. Existing federal law also authorizes an eligible taxpayer, as defined, to transfer the value of that refundable credit and exempts from gross income payment received by the transferor as consideration for the transfer. Existing federal law prohibits the transferee from deducting the amount paid as consideration for the transfer.

This bill, in conformity with federal law, for taxable years beginning on or after January 1, 2026, and before January 1, 2031, would exclude from gross income a refund payment made for the specified federal environmental credits described above and any payment received by a transferor as consideration for a transfer, as provided. The bill would also prohibit a transferee from deducting the amount paid as consideration for the transfer, in conformity with federal law.

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.

This bill would take effect immediately as a tax levy.

Sponsors

Sponsors by party (alphabetical): Democratic 6

“Support” is shown only as formal sponsorship recorded by the legislature. Roll-call votes are available on the official bill page.

Recent official actions

1. October 1, 2025Chaptered by Secretary of State. Chapter 215, Statutes of 2025.
2. October 1, 2025Approved by the Governor.
3. September 22, 2025Enrolled and presented to the Governor at 11 a.m.
4. September 11, 2025Assembly amendments concurred in. (Ayes 40. Noes 0. Page 2881.) Ordered to engrossing and enrolling.
5. September 10, 2025In Senate. Concurrence in Assembly amendments pending.
6. September 10, 2025Read third time. Passed. (Ayes 79. Noes 0. Page 3175.) Ordered to the Senate.
7. September 2, 2025Read second time. Ordered to third reading.
8. August 29, 2025From committee: Do pass. (Ayes 15. Noes 0.) (August 29).
9. August 20, 2025August 20 set for first hearing. Placed on APPR. suspense file.
10. July 17, 2025Read second time and amended. Re-referred to Com. on APPR.
11. July 17, 2025From committee: Do pass as amended and re-refer to Com. on APPR. (Ayes 7. Noes 0.) (July 14).
12. July 17, 2025Assembly Rule 63 suspended. (Ayes 49. Noes 15. Page 2578.)