Taxation: Earned Income Tax Credit: Young Child Tax Credit: Foster Youth Tax Credit.

(1) The Personal Income Tax Law, 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 law provides that the amount of the credit is calculated as a percentage of the eligible individual's earned income and is phased out above a specified amount as income increases, and provides alternative calculation factors under specified circumstances. Existing law, for taxable years beginning on or after January 1, 2020, and until and including the taxable year in which the minimum wage is set at $15 per hour, requires the phaseout percentage for eligible individuals to be recalculated by the Franchise Tax Board so that the calculated amount of credit for a taxpayer with an earned income of $30,000 is equal to 0. Existing law allows a payment to an eligible individual from the Tax Relief and Refund Account, a continuously appropriated fund, for any amount of the credit in excess of tax liability, as provided. This bill, for taxable years after the taxable year in which the minimum wage is set at $15 per hour, would require the phaseout percentages for the prior taxable year to apply. This bill, for taxable years beginning on or after January 1, 2022, would allow foster care tax credit against personal income tax in a specified amount for a qualified taxpayer, defined as a person who has been allowed an earned income tax credit for the taxable year, was in foster care, as provided, and is between 18 to 25, inclusive, years of age. The bill would authorize a payment from the Tax Relief and Refund Account for any amount of the credit in excess of tax liability. By authorizing an additional payment from the Tax Relief and Refund Account, a continuously appropriated fund, the bill would make an appropriation. Existing law prohibits a person from publishing or disclosing, or permitting the publication or disclosure of, a list of persons receiving public social services and limits the use of the lists to purposes directly connected with the administration of public social services. Existing law generally makes it a misdemeanor for specified persons, including, among others, officers or employees of the state or its political subdivisions, to disclose information set forth or disclosed in returns, reports, or documents required to be filed under the franchise and income tax laws. This bill would make exceptions to the state law prohibitions against sharing information on persons receiving public social services or tax information for the limited purposes of administering the foster youth credit described above. The bill would require the State Department of Social Services to seek any federal approval necessary to implement this exception. (2) The Personal Income Tax Law allows a young child tax credit against the taxes imposed under that law and a payment from the Tax Relief and Refund Account for an allowable credit in excess of tax liability to a qualified taxpayer in a specified amount multiplied by the earned income tax credit adjustment factor, as provided. Existing law defines "qualified taxpayer" for this purpose to include an eligible individual who has a qualified child, as defined, and is allowed an earned income tax credit, as specified. This bill would expand the definition of "qualified taxpayer" to also include an eligible individual who has a qualified child and would have received an earned income tax credit but for the fact that the individual has earned income, as defined, of $0 or less for the taxable year. The bill would also require the amount of the young child tax credit to be recomputed annually in the same manner as the recomputation of income tax brackets, as specified. By authorizing new payments from the Tax Relief and Refund Account in excess of personal income tax liabilities, and by increasing the amount of moneys paid from the account, the bill would make an appropriation. (3) Existing law requires any 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 provide findings to comply with the additional information requirement for any bill authorizing a new tax expenditure. (4) 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 XIIIA of the California Constitution, and thus would require for passage the approval of 23 of the membership of each house of the Legislature. (5) This bill would also make findings and declarations related to a gift of public funds. (6) This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.