Amended IN Assembly June 21, 2022 Amended IN Senate April 18, 2022 CALIFORNIA LEGISLATURE 20212022 REGULAR SESSION Senate Bill No. 1377Introduced by Senator Newman(Coauthor: Senator Wieckowski)February 18, 2022 An act to amend Section 17072 of, and to add Section 17208 to, the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy. LEGISLATIVE COUNSEL'S DIGESTSB 1377, as amended, Newman. Personal income tax: deductions: adjusted gross income: consumer protection violations.The Personal Income Tax Law, in modified conformity with federal income tax laws, allows various deductions from gross income in computing adjusted gross income under that law.This bill, for each taxable year beginning on or after January 1, 2022, would allow a deduction in computing adjusted gross income in an amount equal to attorneys fees and court costs included in gross income by a taxpayer during the taxable year in connection with any litigation involving a claim of a consumer protection violation, as defined. Existing law requires any bill authorizing a new tax expenditure to contain, among other things, specific goals, purposes, and objectives that the tax expenditure will achieve, detailed performance indicators, and data collection requirements.The bill also would include additional information required for any bill authorizing a new tax expenditure.This bill would take effect immediately as a tax levy.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO Bill TextThe people of the State of California do enact as follows:SECTION 1. Section 17072 of the Revenue and Taxation Code is amended to read:17072. (a) Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, shall apply, except as otherwise provided.(b) Section 62(a)(2)(D) of the Internal Revenue Code, relating to certain expenses of elementary and secondary school teachers, shall not apply.(c) Section 62(a)(21) of the Internal Revenue Code, relating to attorneys fees relating to awards to whistleblowers, shall not apply.(d) For each taxable year beginning on or after January 1, 2022, Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, is modified to provide that the deduction under Section 17208 shall be allowed in determining adjusted gross income. SEC. 2. Section 17208 is added to the Revenue and Taxation Code, to read:17208. (a) For each taxable year beginning on or after January 1, 2022, there shall be allowed as a deduction an amount equal to attorneys fees and court costs included in gross income by a taxpayer during the taxable year in connection with any litigation involving a claim of a consumer protection violation.(b) For purposes of this section, consumer protection violation means an act that is unlawful under any of the following:(1) Section 987 of the General Military Law (10 U.S.C. Sec. 987).(2) Sections 6, 8, or 9 of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. Secs. 2605, 2607, and 2608).(3) The Expedited Funds Availability Act (12 U.S.C. Sec. 4001).(4) The Homeowners Protection Act of 1998 (12 U.S.C. Sec. 4901).(5) The Truth in Lending Act (15 U.S.C. Sec. 1601).(6) The Credit Repair Organizations Act (15 U.S.C. Sec. 1679).(7) The Fair Credit Reporting Act (15 U.S.C. Sec. 1681).(8) The Equal Credit Opportunity Act (15 U.S.C. Sec. 1691).(9) The Fair Debt Collection Practices Act (15 U.S.C. Sec. 1692).(10) The Electronic Fund Transfer Act (15 U.S.C. Sec. 1693).(11) The Interstate Land Sales Full Disclosure Act (15 U.S.C. Sec. 1701).(12) The Consumer Product Safety Act (15 U.S.C. Sec. 2051).(13) The Magnuson-Moss Warranty-Federal Trade Commission Improvement Act (15 U.S.C. Sec. 2301).(14) The Servicemembers Civil Relief Act (50 U.S.C. Sec. 3901).(15) Song-Beverly Consumer Warranty Act (Chapter 1 (commencing with Section 1790) of Title 1.7 of Part 4 of Division 3 of the Civil Code).(16) Consumer Legal Remedies Act (Chapter 1 (commencing with Section 1750) of Title 1.5 of Part 4 of Division 3 of the Civil Code).(17) Any provision of federal or state law prohibiting unfair or deceptive trade or credit practices.(18) Any provision of federal, state, or local law, including any provision of the laws of another state that provide for the enforcement of consumer protection or regulate any aspect of consumer transactions, including claims for unfair, deceptive, or abusive trade or credit practices, or for other actions that cause harm to an individual by a seller or provider of property, services, securities or other investments, money, or credit for personal, family, or household use. (c) Any deduction otherwise allowed under Section 17201 for attorneys fees and court costs shall be reduced by the amount of the deduction allowed under this section.(d) For the purpose of complying with Section 41, with respect to the deductions allowed by this section, the Legislature finds and declares all of the following:(1) The specific purpose of the deduction is to protect plaintiffs who prevail in litigation involving a claim of a consumer protection violation, and whose attorneys are awarded attorneys fees, from undue taxation or the threat of undue taxation of income they do not receive.(2) To measure if the deduction achieves its intended purpose, the following performance indicators shall be used:(A) The total number of returns that claimed the deduction allowed under this section.(B) The total amount claimed as deductions allowed under this section.(3) On or before August 1, 2026, and every two years thereafter, the Franchise Tax Board shall provide a report, in compliance with Section 9795 of the Government Code, on the two previous taxable years for which a full year of data is available, to the Senate Committee on Budget and Fiscal Review, the Assembly Committee on Budget, the Senate and Assembly Committees on Appropriations, the Senate Committee on Governance and Finance, and the Assembly Committee on Revenue and Taxation.SEC. 3. This act provides for a tax levy within the meaning of Article IV of the California Constitution and shall go into immediate effect.
Amended IN Assembly June 21, 2022 Amended IN Senate April 18, 2022 CALIFORNIA LEGISLATURE 20212022 REGULAR SESSION Senate Bill No. 1377Introduced by Senator Newman(Coauthor: Senator Wieckowski)February 18, 2022 An act to amend Section 17072 of, and to add Section 17208 to, the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy. LEGISLATIVE COUNSEL'S DIGESTSB 1377, as amended, Newman. Personal income tax: deductions: adjusted gross income: consumer protection violations.The Personal Income Tax Law, in modified conformity with federal income tax laws, allows various deductions from gross income in computing adjusted gross income under that law.This bill, for each taxable year beginning on or after January 1, 2022, would allow a deduction in computing adjusted gross income in an amount equal to attorneys fees and court costs included in gross income by a taxpayer during the taxable year in connection with any litigation involving a claim of a consumer protection violation, as defined. Existing law requires any bill authorizing a new tax expenditure to contain, among other things, specific goals, purposes, and objectives that the tax expenditure will achieve, detailed performance indicators, and data collection requirements.The bill also would include additional information required for any bill authorizing a new tax expenditure.This bill would take effect immediately as a tax levy.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO
Amended IN Assembly June 21, 2022 Amended IN Senate April 18, 2022
Amended IN Assembly June 21, 2022
Amended IN Senate April 18, 2022
CALIFORNIA LEGISLATURE 20212022 REGULAR SESSION
Senate Bill
No. 1377
Introduced by Senator Newman(Coauthor: Senator Wieckowski)February 18, 2022
Introduced by Senator Newman(Coauthor: Senator Wieckowski)
February 18, 2022
An act to amend Section 17072 of, and to add Section 17208 to, the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.
LEGISLATIVE COUNSEL'S DIGEST
## LEGISLATIVE COUNSEL'S DIGEST
SB 1377, as amended, Newman. Personal income tax: deductions: adjusted gross income: consumer protection violations.
The Personal Income Tax Law, in modified conformity with federal income tax laws, allows various deductions from gross income in computing adjusted gross income under that law.This bill, for each taxable year beginning on or after January 1, 2022, would allow a deduction in computing adjusted gross income in an amount equal to attorneys fees and court costs included in gross income by a taxpayer during the taxable year in connection with any litigation involving a claim of a consumer protection violation, as defined. Existing law requires any bill authorizing a new tax expenditure to contain, among other things, specific goals, purposes, and objectives that the tax expenditure will achieve, detailed performance indicators, and data collection requirements.The bill also would include additional information required for any bill authorizing a new tax expenditure.This bill would take effect immediately as a tax levy.
The Personal Income Tax Law, in modified conformity with federal income tax laws, allows various deductions from gross income in computing adjusted gross income under that law.
This bill, for each taxable year beginning on or after January 1, 2022, would allow a deduction in computing adjusted gross income in an amount equal to attorneys fees and court costs included in gross income by a taxpayer during the taxable year in connection with any litigation involving a claim of a consumer protection violation, as defined.
Existing law requires any bill authorizing a new tax expenditure to contain, among other things, specific goals, purposes, and objectives that the tax expenditure will achieve, detailed performance indicators, and data collection requirements.
The bill also would include additional information required for any bill authorizing a new tax expenditure.
This bill would take effect immediately as a tax levy.
## Digest Key
## Bill Text
The people of the State of California do enact as follows:SECTION 1. Section 17072 of the Revenue and Taxation Code is amended to read:17072. (a) Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, shall apply, except as otherwise provided.(b) Section 62(a)(2)(D) of the Internal Revenue Code, relating to certain expenses of elementary and secondary school teachers, shall not apply.(c) Section 62(a)(21) of the Internal Revenue Code, relating to attorneys fees relating to awards to whistleblowers, shall not apply.(d) For each taxable year beginning on or after January 1, 2022, Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, is modified to provide that the deduction under Section 17208 shall be allowed in determining adjusted gross income. SEC. 2. Section 17208 is added to the Revenue and Taxation Code, to read:17208. (a) For each taxable year beginning on or after January 1, 2022, there shall be allowed as a deduction an amount equal to attorneys fees and court costs included in gross income by a taxpayer during the taxable year in connection with any litigation involving a claim of a consumer protection violation.(b) For purposes of this section, consumer protection violation means an act that is unlawful under any of the following:(1) Section 987 of the General Military Law (10 U.S.C. Sec. 987).(2) Sections 6, 8, or 9 of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. Secs. 2605, 2607, and 2608).(3) The Expedited Funds Availability Act (12 U.S.C. Sec. 4001).(4) The Homeowners Protection Act of 1998 (12 U.S.C. Sec. 4901).(5) The Truth in Lending Act (15 U.S.C. Sec. 1601).(6) The Credit Repair Organizations Act (15 U.S.C. Sec. 1679).(7) The Fair Credit Reporting Act (15 U.S.C. Sec. 1681).(8) The Equal Credit Opportunity Act (15 U.S.C. Sec. 1691).(9) The Fair Debt Collection Practices Act (15 U.S.C. Sec. 1692).(10) The Electronic Fund Transfer Act (15 U.S.C. Sec. 1693).(11) The Interstate Land Sales Full Disclosure Act (15 U.S.C. Sec. 1701).(12) The Consumer Product Safety Act (15 U.S.C. Sec. 2051).(13) The Magnuson-Moss Warranty-Federal Trade Commission Improvement Act (15 U.S.C. Sec. 2301).(14) The Servicemembers Civil Relief Act (50 U.S.C. Sec. 3901).(15) Song-Beverly Consumer Warranty Act (Chapter 1 (commencing with Section 1790) of Title 1.7 of Part 4 of Division 3 of the Civil Code).(16) Consumer Legal Remedies Act (Chapter 1 (commencing with Section 1750) of Title 1.5 of Part 4 of Division 3 of the Civil Code).(17) Any provision of federal or state law prohibiting unfair or deceptive trade or credit practices.(18) Any provision of federal, state, or local law, including any provision of the laws of another state that provide for the enforcement of consumer protection or regulate any aspect of consumer transactions, including claims for unfair, deceptive, or abusive trade or credit practices, or for other actions that cause harm to an individual by a seller or provider of property, services, securities or other investments, money, or credit for personal, family, or household use. (c) Any deduction otherwise allowed under Section 17201 for attorneys fees and court costs shall be reduced by the amount of the deduction allowed under this section.(d) For the purpose of complying with Section 41, with respect to the deductions allowed by this section, the Legislature finds and declares all of the following:(1) The specific purpose of the deduction is to protect plaintiffs who prevail in litigation involving a claim of a consumer protection violation, and whose attorneys are awarded attorneys fees, from undue taxation or the threat of undue taxation of income they do not receive.(2) To measure if the deduction achieves its intended purpose, the following performance indicators shall be used:(A) The total number of returns that claimed the deduction allowed under this section.(B) The total amount claimed as deductions allowed under this section.(3) On or before August 1, 2026, and every two years thereafter, the Franchise Tax Board shall provide a report, in compliance with Section 9795 of the Government Code, on the two previous taxable years for which a full year of data is available, to the Senate Committee on Budget and Fiscal Review, the Assembly Committee on Budget, the Senate and Assembly Committees on Appropriations, the Senate Committee on Governance and Finance, and the Assembly Committee on Revenue and Taxation.SEC. 3. This act provides for a tax levy within the meaning of Article IV of the California Constitution and shall go into immediate effect.
The people of the State of California do enact as follows:
## The people of the State of California do enact as follows:
SECTION 1. Section 17072 of the Revenue and Taxation Code is amended to read:17072. (a) Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, shall apply, except as otherwise provided.(b) Section 62(a)(2)(D) of the Internal Revenue Code, relating to certain expenses of elementary and secondary school teachers, shall not apply.(c) Section 62(a)(21) of the Internal Revenue Code, relating to attorneys fees relating to awards to whistleblowers, shall not apply.(d) For each taxable year beginning on or after January 1, 2022, Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, is modified to provide that the deduction under Section 17208 shall be allowed in determining adjusted gross income.
SECTION 1. Section 17072 of the Revenue and Taxation Code is amended to read:
### SECTION 1.
17072. (a) Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, shall apply, except as otherwise provided.(b) Section 62(a)(2)(D) of the Internal Revenue Code, relating to certain expenses of elementary and secondary school teachers, shall not apply.(c) Section 62(a)(21) of the Internal Revenue Code, relating to attorneys fees relating to awards to whistleblowers, shall not apply.(d) For each taxable year beginning on or after January 1, 2022, Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, is modified to provide that the deduction under Section 17208 shall be allowed in determining adjusted gross income.
17072. (a) Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, shall apply, except as otherwise provided.(b) Section 62(a)(2)(D) of the Internal Revenue Code, relating to certain expenses of elementary and secondary school teachers, shall not apply.(c) Section 62(a)(21) of the Internal Revenue Code, relating to attorneys fees relating to awards to whistleblowers, shall not apply.(d) For each taxable year beginning on or after January 1, 2022, Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, is modified to provide that the deduction under Section 17208 shall be allowed in determining adjusted gross income.
17072. (a) Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, shall apply, except as otherwise provided.(b) Section 62(a)(2)(D) of the Internal Revenue Code, relating to certain expenses of elementary and secondary school teachers, shall not apply.(c) Section 62(a)(21) of the Internal Revenue Code, relating to attorneys fees relating to awards to whistleblowers, shall not apply.(d) For each taxable year beginning on or after January 1, 2022, Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, is modified to provide that the deduction under Section 17208 shall be allowed in determining adjusted gross income.
17072. (a) Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, shall apply, except as otherwise provided.
(b) Section 62(a)(2)(D) of the Internal Revenue Code, relating to certain expenses of elementary and secondary school teachers, shall not apply.
(c) Section 62(a)(21) of the Internal Revenue Code, relating to attorneys fees relating to awards to whistleblowers, shall not apply.
(d) For each taxable year beginning on or after January 1, 2022, Section 62 of the Internal Revenue Code, relating to adjusted gross income defined, is modified to provide that the deduction under Section 17208 shall be allowed in determining adjusted gross income.
SEC. 2. Section 17208 is added to the Revenue and Taxation Code, to read:17208. (a) For each taxable year beginning on or after January 1, 2022, there shall be allowed as a deduction an amount equal to attorneys fees and court costs included in gross income by a taxpayer during the taxable year in connection with any litigation involving a claim of a consumer protection violation.(b) For purposes of this section, consumer protection violation means an act that is unlawful under any of the following:(1) Section 987 of the General Military Law (10 U.S.C. Sec. 987).(2) Sections 6, 8, or 9 of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. Secs. 2605, 2607, and 2608).(3) The Expedited Funds Availability Act (12 U.S.C. Sec. 4001).(4) The Homeowners Protection Act of 1998 (12 U.S.C. Sec. 4901).(5) The Truth in Lending Act (15 U.S.C. Sec. 1601).(6) The Credit Repair Organizations Act (15 U.S.C. Sec. 1679).(7) The Fair Credit Reporting Act (15 U.S.C. Sec. 1681).(8) The Equal Credit Opportunity Act (15 U.S.C. Sec. 1691).(9) The Fair Debt Collection Practices Act (15 U.S.C. Sec. 1692).(10) The Electronic Fund Transfer Act (15 U.S.C. Sec. 1693).(11) The Interstate Land Sales Full Disclosure Act (15 U.S.C. Sec. 1701).(12) The Consumer Product Safety Act (15 U.S.C. Sec. 2051).(13) The Magnuson-Moss Warranty-Federal Trade Commission Improvement Act (15 U.S.C. Sec. 2301).(14) The Servicemembers Civil Relief Act (50 U.S.C. Sec. 3901).(15) Song-Beverly Consumer Warranty Act (Chapter 1 (commencing with Section 1790) of Title 1.7 of Part 4 of Division 3 of the Civil Code).(16) Consumer Legal Remedies Act (Chapter 1 (commencing with Section 1750) of Title 1.5 of Part 4 of Division 3 of the Civil Code).(17) Any provision of federal or state law prohibiting unfair or deceptive trade or credit practices.(18) Any provision of federal, state, or local law, including any provision of the laws of another state that provide for the enforcement of consumer protection or regulate any aspect of consumer transactions, including claims for unfair, deceptive, or abusive trade or credit practices, or for other actions that cause harm to an individual by a seller or provider of property, services, securities or other investments, money, or credit for personal, family, or household use. (c) Any deduction otherwise allowed under Section 17201 for attorneys fees and court costs shall be reduced by the amount of the deduction allowed under this section.(d) For the purpose of complying with Section 41, with respect to the deductions allowed by this section, the Legislature finds and declares all of the following:(1) The specific purpose of the deduction is to protect plaintiffs who prevail in litigation involving a claim of a consumer protection violation, and whose attorneys are awarded attorneys fees, from undue taxation or the threat of undue taxation of income they do not receive.(2) To measure if the deduction achieves its intended purpose, the following performance indicators shall be used:(A) The total number of returns that claimed the deduction allowed under this section.(B) The total amount claimed as deductions allowed under this section.(3) On or before August 1, 2026, and every two years thereafter, the Franchise Tax Board shall provide a report, in compliance with Section 9795 of the Government Code, on the two previous taxable years for which a full year of data is available, to the Senate Committee on Budget and Fiscal Review, the Assembly Committee on Budget, the Senate and Assembly Committees on Appropriations, the Senate Committee on Governance and Finance, and the Assembly Committee on Revenue and Taxation.
SEC. 2. Section 17208 is added to the Revenue and Taxation Code, to read:
### SEC. 2.
17208. (a) For each taxable year beginning on or after January 1, 2022, there shall be allowed as a deduction an amount equal to attorneys fees and court costs included in gross income by a taxpayer during the taxable year in connection with any litigation involving a claim of a consumer protection violation.(b) For purposes of this section, consumer protection violation means an act that is unlawful under any of the following:(1) Section 987 of the General Military Law (10 U.S.C. Sec. 987).(2) Sections 6, 8, or 9 of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. Secs. 2605, 2607, and 2608).(3) The Expedited Funds Availability Act (12 U.S.C. Sec. 4001).(4) The Homeowners Protection Act of 1998 (12 U.S.C. Sec. 4901).(5) The Truth in Lending Act (15 U.S.C. Sec. 1601).(6) The Credit Repair Organizations Act (15 U.S.C. Sec. 1679).(7) The Fair Credit Reporting Act (15 U.S.C. Sec. 1681).(8) The Equal Credit Opportunity Act (15 U.S.C. Sec. 1691).(9) The Fair Debt Collection Practices Act (15 U.S.C. Sec. 1692).(10) The Electronic Fund Transfer Act (15 U.S.C. Sec. 1693).(11) The Interstate Land Sales Full Disclosure Act (15 U.S.C. Sec. 1701).(12) The Consumer Product Safety Act (15 U.S.C. Sec. 2051).(13) The Magnuson-Moss Warranty-Federal Trade Commission Improvement Act (15 U.S.C. Sec. 2301).(14) The Servicemembers Civil Relief Act (50 U.S.C. Sec. 3901).(15) Song-Beverly Consumer Warranty Act (Chapter 1 (commencing with Section 1790) of Title 1.7 of Part 4 of Division 3 of the Civil Code).(16) Consumer Legal Remedies Act (Chapter 1 (commencing with Section 1750) of Title 1.5 of Part 4 of Division 3 of the Civil Code).(17) Any provision of federal or state law prohibiting unfair or deceptive trade or credit practices.(18) Any provision of federal, state, or local law, including any provision of the laws of another state that provide for the enforcement of consumer protection or regulate any aspect of consumer transactions, including claims for unfair, deceptive, or abusive trade or credit practices, or for other actions that cause harm to an individual by a seller or provider of property, services, securities or other investments, money, or credit for personal, family, or household use. (c) Any deduction otherwise allowed under Section 17201 for attorneys fees and court costs shall be reduced by the amount of the deduction allowed under this section.(d) For the purpose of complying with Section 41, with respect to the deductions allowed by this section, the Legislature finds and declares all of the following:(1) The specific purpose of the deduction is to protect plaintiffs who prevail in litigation involving a claim of a consumer protection violation, and whose attorneys are awarded attorneys fees, from undue taxation or the threat of undue taxation of income they do not receive.(2) To measure if the deduction achieves its intended purpose, the following performance indicators shall be used:(A) The total number of returns that claimed the deduction allowed under this section.(B) The total amount claimed as deductions allowed under this section.(3) On or before August 1, 2026, and every two years thereafter, the Franchise Tax Board shall provide a report, in compliance with Section 9795 of the Government Code, on the two previous taxable years for which a full year of data is available, to the Senate Committee on Budget and Fiscal Review, the Assembly Committee on Budget, the Senate and Assembly Committees on Appropriations, the Senate Committee on Governance and Finance, and the Assembly Committee on Revenue and Taxation.
17208. (a) For each taxable year beginning on or after January 1, 2022, there shall be allowed as a deduction an amount equal to attorneys fees and court costs included in gross income by a taxpayer during the taxable year in connection with any litigation involving a claim of a consumer protection violation.(b) For purposes of this section, consumer protection violation means an act that is unlawful under any of the following:(1) Section 987 of the General Military Law (10 U.S.C. Sec. 987).(2) Sections 6, 8, or 9 of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. Secs. 2605, 2607, and 2608).(3) The Expedited Funds Availability Act (12 U.S.C. Sec. 4001).(4) The Homeowners Protection Act of 1998 (12 U.S.C. Sec. 4901).(5) The Truth in Lending Act (15 U.S.C. Sec. 1601).(6) The Credit Repair Organizations Act (15 U.S.C. Sec. 1679).(7) The Fair Credit Reporting Act (15 U.S.C. Sec. 1681).(8) The Equal Credit Opportunity Act (15 U.S.C. Sec. 1691).(9) The Fair Debt Collection Practices Act (15 U.S.C. Sec. 1692).(10) The Electronic Fund Transfer Act (15 U.S.C. Sec. 1693).(11) The Interstate Land Sales Full Disclosure Act (15 U.S.C. Sec. 1701).(12) The Consumer Product Safety Act (15 U.S.C. Sec. 2051).(13) The Magnuson-Moss Warranty-Federal Trade Commission Improvement Act (15 U.S.C. Sec. 2301).(14) The Servicemembers Civil Relief Act (50 U.S.C. Sec. 3901).(15) Song-Beverly Consumer Warranty Act (Chapter 1 (commencing with Section 1790) of Title 1.7 of Part 4 of Division 3 of the Civil Code).(16) Consumer Legal Remedies Act (Chapter 1 (commencing with Section 1750) of Title 1.5 of Part 4 of Division 3 of the Civil Code).(17) Any provision of federal or state law prohibiting unfair or deceptive trade or credit practices.(18) Any provision of federal, state, or local law, including any provision of the laws of another state that provide for the enforcement of consumer protection or regulate any aspect of consumer transactions, including claims for unfair, deceptive, or abusive trade or credit practices, or for other actions that cause harm to an individual by a seller or provider of property, services, securities or other investments, money, or credit for personal, family, or household use. (c) Any deduction otherwise allowed under Section 17201 for attorneys fees and court costs shall be reduced by the amount of the deduction allowed under this section.(d) For the purpose of complying with Section 41, with respect to the deductions allowed by this section, the Legislature finds and declares all of the following:(1) The specific purpose of the deduction is to protect plaintiffs who prevail in litigation involving a claim of a consumer protection violation, and whose attorneys are awarded attorneys fees, from undue taxation or the threat of undue taxation of income they do not receive.(2) To measure if the deduction achieves its intended purpose, the following performance indicators shall be used:(A) The total number of returns that claimed the deduction allowed under this section.(B) The total amount claimed as deductions allowed under this section.(3) On or before August 1, 2026, and every two years thereafter, the Franchise Tax Board shall provide a report, in compliance with Section 9795 of the Government Code, on the two previous taxable years for which a full year of data is available, to the Senate Committee on Budget and Fiscal Review, the Assembly Committee on Budget, the Senate and Assembly Committees on Appropriations, the Senate Committee on Governance and Finance, and the Assembly Committee on Revenue and Taxation.
17208. (a) For each taxable year beginning on or after January 1, 2022, there shall be allowed as a deduction an amount equal to attorneys fees and court costs included in gross income by a taxpayer during the taxable year in connection with any litigation involving a claim of a consumer protection violation.(b) For purposes of this section, consumer protection violation means an act that is unlawful under any of the following:(1) Section 987 of the General Military Law (10 U.S.C. Sec. 987).(2) Sections 6, 8, or 9 of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. Secs. 2605, 2607, and 2608).(3) The Expedited Funds Availability Act (12 U.S.C. Sec. 4001).(4) The Homeowners Protection Act of 1998 (12 U.S.C. Sec. 4901).(5) The Truth in Lending Act (15 U.S.C. Sec. 1601).(6) The Credit Repair Organizations Act (15 U.S.C. Sec. 1679).(7) The Fair Credit Reporting Act (15 U.S.C. Sec. 1681).(8) The Equal Credit Opportunity Act (15 U.S.C. Sec. 1691).(9) The Fair Debt Collection Practices Act (15 U.S.C. Sec. 1692).(10) The Electronic Fund Transfer Act (15 U.S.C. Sec. 1693).(11) The Interstate Land Sales Full Disclosure Act (15 U.S.C. Sec. 1701).(12) The Consumer Product Safety Act (15 U.S.C. Sec. 2051).(13) The Magnuson-Moss Warranty-Federal Trade Commission Improvement Act (15 U.S.C. Sec. 2301).(14) The Servicemembers Civil Relief Act (50 U.S.C. Sec. 3901).(15) Song-Beverly Consumer Warranty Act (Chapter 1 (commencing with Section 1790) of Title 1.7 of Part 4 of Division 3 of the Civil Code).(16) Consumer Legal Remedies Act (Chapter 1 (commencing with Section 1750) of Title 1.5 of Part 4 of Division 3 of the Civil Code).(17) Any provision of federal or state law prohibiting unfair or deceptive trade or credit practices.(18) Any provision of federal, state, or local law, including any provision of the laws of another state that provide for the enforcement of consumer protection or regulate any aspect of consumer transactions, including claims for unfair, deceptive, or abusive trade or credit practices, or for other actions that cause harm to an individual by a seller or provider of property, services, securities or other investments, money, or credit for personal, family, or household use. (c) Any deduction otherwise allowed under Section 17201 for attorneys fees and court costs shall be reduced by the amount of the deduction allowed under this section.(d) For the purpose of complying with Section 41, with respect to the deductions allowed by this section, the Legislature finds and declares all of the following:(1) The specific purpose of the deduction is to protect plaintiffs who prevail in litigation involving a claim of a consumer protection violation, and whose attorneys are awarded attorneys fees, from undue taxation or the threat of undue taxation of income they do not receive.(2) To measure if the deduction achieves its intended purpose, the following performance indicators shall be used:(A) The total number of returns that claimed the deduction allowed under this section.(B) The total amount claimed as deductions allowed under this section.(3) On or before August 1, 2026, and every two years thereafter, the Franchise Tax Board shall provide a report, in compliance with Section 9795 of the Government Code, on the two previous taxable years for which a full year of data is available, to the Senate Committee on Budget and Fiscal Review, the Assembly Committee on Budget, the Senate and Assembly Committees on Appropriations, the Senate Committee on Governance and Finance, and the Assembly Committee on Revenue and Taxation.
17208. (a) For each taxable year beginning on or after January 1, 2022, there shall be allowed as a deduction an amount equal to attorneys fees and court costs included in gross income by a taxpayer during the taxable year in connection with any litigation involving a claim of a consumer protection violation.
(b) For purposes of this section, consumer protection violation means an act that is unlawful under any of the following:
(1) Section 987 of the General Military Law (10 U.S.C. Sec. 987).
(2) Sections 6, 8, or 9 of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. Secs. 2605, 2607, and 2608).
(3) The Expedited Funds Availability Act (12 U.S.C. Sec. 4001).
(4) The Homeowners Protection Act of 1998 (12 U.S.C. Sec. 4901).
(5) The Truth in Lending Act (15 U.S.C. Sec. 1601).
(6) The Credit Repair Organizations Act (15 U.S.C. Sec. 1679).
(7) The Fair Credit Reporting Act (15 U.S.C. Sec. 1681).
(8) The Equal Credit Opportunity Act (15 U.S.C. Sec. 1691).
(9) The Fair Debt Collection Practices Act (15 U.S.C. Sec. 1692).
(10) The Electronic Fund Transfer Act (15 U.S.C. Sec. 1693).
(11) The Interstate Land Sales Full Disclosure Act (15 U.S.C. Sec. 1701).
(12) The Consumer Product Safety Act (15 U.S.C. Sec. 2051).
(13) The Magnuson-Moss Warranty-Federal Trade Commission Improvement Act (15 U.S.C. Sec. 2301).
(14) The Servicemembers Civil Relief Act (50 U.S.C. Sec. 3901).
(15) Song-Beverly Consumer Warranty Act (Chapter 1 (commencing with Section 1790) of Title 1.7 of Part 4 of Division 3 of the Civil Code).
(16) Consumer Legal Remedies Act (Chapter 1 (commencing with Section 1750) of Title 1.5 of Part 4 of Division 3 of the Civil Code).
(17) Any provision of federal or state law prohibiting unfair or deceptive trade or credit practices.
(18) Any provision of federal, state, or local law, including any provision of the laws of another state that provide for the enforcement of consumer protection or regulate any aspect of consumer transactions, including claims for unfair, deceptive, or abusive trade or credit practices, or for other actions that cause harm to an individual by a seller or provider of property, services, securities or other investments, money, or credit for personal, family, or household use.
(c) Any deduction otherwise allowed under Section 17201 for attorneys fees and court costs shall be reduced by the amount of the deduction allowed under this section.
(d) For the purpose of complying with Section 41, with respect to the deductions allowed by this section, the Legislature finds and declares all of the following:
(1) The specific purpose of the deduction is to protect plaintiffs who prevail in litigation involving a claim of a consumer protection violation, and whose attorneys are awarded attorneys fees, from undue taxation or the threat of undue taxation of income they do not receive.
(2) To measure if the deduction achieves its intended purpose, the following performance indicators shall be used:
(A) The total number of returns that claimed the deduction allowed under this section.
(B) The total amount claimed as deductions allowed under this section.
(3) On or before August 1, 2026, and every two years thereafter, the Franchise Tax Board shall provide a report, in compliance with Section 9795 of the Government Code, on the two previous taxable years for which a full year of data is available, to the Senate Committee on Budget and Fiscal Review, the Assembly Committee on Budget, the Senate and Assembly Committees on Appropriations, the Senate Committee on Governance and Finance, and the Assembly Committee on Revenue and Taxation.
SEC. 3. This act provides for a tax levy within the meaning of Article IV of the California Constitution and shall go into immediate effect.
SEC. 3. This act provides for a tax levy within the meaning of Article IV of the California Constitution and shall go into immediate effect.
SEC. 3. This act provides for a tax levy within the meaning of Article IV of the California Constitution and shall go into immediate effect.
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