SB 1120: Personal Income Tax Law: Corporation Tax Law: credits: CalCompetes. - California

04/13/26 - Amended Senate → SB1120 · 3 edits

MINOR

This diff represents a republishing of SB 1120 from the formal amended Senate document format (with line numbers and page headers) to a web-based bill text publication. The substantive policy content is unchanged: the bill extends the California Competes Tax Credit through taxable years beginning before January 1, 2035, and allows taxpayers in strategic industries (nuclear fusion, quantum technology, or other industries in the California Jobs First State Economic Blueprint) to elect for refundable credits funded from the Tax Relief and Refund Account or Corporation Tax Fund. A likely typo in Section 23689(a)(3) referencing 'the 2032-33 fiscal year through and including the 2027-28 fiscal year' (reversed chronology) appears to have been corrected in the new version.

TECHNICAL

The bill text was republished from a formal legislative document format (with line numbers, page headers/footers, and traditional layout) to a web-based publication format with navigation elements. No policy substance changed.

A likely typographical error in Section 23689(a)(3) was corrected. The old version stated credit allocation 'with respect to the 2032-33 fiscal year through and including the 2027-28 fiscal year' (reversed chronology), which should read from an earlier year through 2032-33, consistent with Section 17059.2(a)(3).

Minor language clarifications in the refundable credit election provisions, changing phrasing from 'if the taxpayer intends for the credit to be refundable' to 'has made an election for the credit to be refundable' in certain subsections, making the timing of the election more precise.

03/26/26 - Amended Senate → 04/13/26 - Amended Senate · 5 edits · Apr 13, 2026

MODERATE

The April 13 amendment to SB 1120 makes several refinements to the California Competes Tax Credit extension through 2035. The most significant change adds the Corporation Tax Fund as an additional funding source for refundable credits available to strategic industry taxpayers, expanding the pool of money available beyond just the Tax Relief and Refund Account. Other changes include a technical correction to a cross-reference for the small business definition in the corporate tax section, reorganization of the refundable election language into clearer separate subparagraphs, and minor wording clarifications.

FISCAL

Refundable credits for strategic industry taxpayers can now be paid from the Tax Relief and Refund Account OR the Corporation Tax Fund, rather than only the Tax Relief and Refund Account. This expands the funding source available to make these credits refundable.

TECHNICAL

In Section 23689 (corporate tax), the small business definition cross-reference was corrected from Section 17053.73 (individual income tax provision) to Section 23626 (corporate tax provision), fixing an incorrect legal citation.

Fixed a typo in the workforce quality factors: changed 'and or preapprenticeship' to 'or preapprenticeship' in the list of training program types.

REQUIREMENT

The refundable election language in Section 17059.2(e)(2) was reorganized into separate subparagraphs: (A) covers the mechanics of how excess credit is refunded, and (B) specifically states that the election must be made in the form and manner prescribed by GO-Biz at the time of application or within six months of the effective date.

GO-Biz notification to the Franchise Tax Board was changed from reporting whether a taxpayer 'intends' for the credit to be refundable to whether the taxpayer 'has made an election' for the credit to be refundable, making the language more precise about when the determination is final.

02/17/26 - Introduced → 03/26/26 - Amended Senate · 8 edits · Mar 26, 2026

MODERATE

The Senate amendment extends the California Competes Tax Credit (CalCompetes) by five years, from expiring before January 1, 2030 to before January 1, 2035. It also extends the fiscal year allocation period from 2027-28 to 2032-33 and makes conforming cross-reference changes throughout both the personal income tax and corporation tax provisions. This keeps the credit program available for businesses seeking job creation and investment incentives through 2034.

TIMELINE

The overall expiration date of the California Competes Tax Credit is extended from January 1, 2030 to January 1, 2035, in both the personal income tax (Section 17059.2) and corporation tax (Section 23689) provisions.

The fiscal year through which GO-Biz can allocate credits is extended from 2027-28 to 2032-33, allowing new credit agreements to be made for five additional fiscal years.

The period during which strategic industry taxpayers (nuclear fusion, quantum technology, etc.) can elect for refundable credits from the Tax Relief and Refund Account is extended from before January 1, 2030 to before January 1, 2035.

The sunset/repeal date of the section is changed from December 1, 2030 to December 1, 2035.

The Department of Finance estimate period for total credits claimed is extended from fiscal year 2029-30 to fiscal year 2034-35.

TECHNICAL

Cross-references in Section 23689 (corporation tax) are updated from 'Section 23689' to 'Section 17059.2' (personal income tax) in the shared funding pool provisions, reflecting that both sections draw from the same aggregate credit amount.

In Section 23689, the small business definition reference is corrected from Section 17053.73 to Section 23626 (the corporation tax equivalent).

A minor wording change replaces 'and preapprenticeship' with 'or preapprenticeship' in the list of workforce quality factors GO-Biz may consider.

Personal Income Tax Law: Corporation Tax Law: credits: CalCompetes.

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