Personal income tax: earned income tax credit.

The Personal Income Tax Law allows various credits against the taxes imposed by that law, including certain credits that are allowed in modified conformity to credits allowed by federal income tax laws. Federal income tax laws allow a refundable earned income tax credit for certain low-income individuals who have earned income from wages, salaries, tips, and other employee compensation plus net earnings from self-employment and who meet certain other requirements. The Personal Income Tax Law, for taxable years beginning on or after January 1, 2015, in modified conformity with federal income tax laws, allows an earned income tax credit against personal income tax and a payment from the Tax Relief and Refund Account for an allowable credit in excess of tax liability, to an eligible individual that is equal to that portion of the earned income tax credit allowed by federal law as determined by the earned income tax credit adjustment factor, as specified. The Personal Income Tax Law, in modified conformity with federal income tax laws, allows the earned income tax credit to eligible individuals, defined as any individual who has a qualifying child for the taxable year or any other individual who does not have a qualifying child for the taxable year if specified factors are met, including that the individual has attained 25 years of age but has not attained 65 years of age. This bill, for taxable years beginning on or after January 1, 2019, would instead allow the earned income tax credit to eligible individuals who do not have a qualifying child for the taxable year and have attained 18 years of age but not attained 65 years of age. Existing law establishes the continuously appropriated Tax Relief and Refund Account and provides that payments required to be made to taxpayers or other persons from the Personal Income Tax Fund are to be paid from that account, including any amount to be paid as an earned income tax credit in excess of any tax liabilities. By authorizing new payments from that account for additional amounts in excess of personal income tax liabilities, this bill would make an appropriation.