Plain English Breakdown
The official text does not specify the exact effective date beyond stating it takes effect immediately as a tax levy; no specific calendar date is provided.
Extending the New Employment Tax Credit
AB-2205 extends an existing tax credit for hiring qualified full-time workers in specific areas and includes required information about goals and data collection.
What This Bill Does
- Extends the time period when businesses can claim a credit for hiring qualified employees through taxable years starting before January 1, 2031.
- Moves the date when this tax credit program ends from December 1, 2029, to December 1, 2034.
- Keeps the rule that allows businesses to reduce their taxes by an amount equal to 35% of qualified wages paid to new full-time workers in designated areas.
- Includes specific goals and data collection plans required for bills authorizing tax expenditures.
Who It Names or Affects
- Businesses subject to the Personal Income Tax Law or Corporation Tax Law
- Employers hiring qualified full-time employees within a designated census tract or economic development area
Terms To Know
- Tax Credit
- An amount that can be subtracted directly from the total tax owed.
- Designated Census Tract or Economic Development Area
- Specific geographic locations where this credit is available for new hires, unless an exemption applies.
Limits and Unknowns
- The bill does not change the definition of qualified wages, which must exceed 150% but not exceed 350% of minimum wage.
- Existing rules that disallow this credit for specified businesses remain in place.