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California Laws | Revenue and Taxation Code
DIVISION 2. OTHER TAXES
PART 11. CORPORATION TAX LAW

(h) The provisions of Section 56(d)(3), relating to net operating loss attributable to federally declared disasters, shall not apply. (19613)

23456.5. The amendments to Section 56 of the Internal Revenue Code by Section 4(1) of Public Law 106-519, regarding adjustments in computing alternative minimum tax income relating to the exclusion under Section 114 of the Internal Revenue Code, shall not apply. (19614)

23456.5. The amendments to Section 56 of the Internal Revenue Code by Section 4(1) of Public Law 106-519, regarding adjustments in computing alternative minimum tax income relating to the exclusion under Section 114 of the Internal Revenue Code, shall not apply. (19615)

23457. For purposes of this part, Section 57 of the Internal Revenue Code is modified as follows: (19616)

(a) Section 57(a)(5) of the Internal Revenue Code, relating to tax-exempt interest, shall not be applicable. (19617)

(b) Section 57(a)(6) of the Internal Revenue Code, relating to accelerated depreciation or amortization on certain property placed in service before January 1, 1987, is modified to read: With respect to each property as described in Section 1250(c) of the Internal Revenue Code as that provision read on April 1, 1970, the amount by which the deduction allowable for the taxable year for exhaustion, wear, tear, obsolescence, or amortization exceeds the depreciation deduction that would have been allowable for the taxable year, had the taxpayer depreciated the property under the straight line method for each taxable year of its useful life (determined without regard to Section 24354.2 or 24381) for which the taxpayer has held the property. (19618)

23459. For purposes of this part, the provisions of Section 59 of the Internal Revenue Code are modified as follows: (19619)

(a) Section 59(a) of the Internal Revenue Code, relating to the alternative minimum tax foreign tax credit, shall not be applicable. (19620)

(b) Section 59(b) of the Internal Revenue Code, relating to income eligible for the credit under Section 936 of the Internal Revenue Code, shall not be applicable. (19621)

(c) Subparagraphs (A), (B), and (C) of Section 59(e)(2) of the Internal Revenue Code, relating to qualified expenditures, are modified to refer to: (19622)

(1) Section 24364, in lieu of the deduction under Section 173 of the Internal Revenue Code. (19623)

(2) Section 24423, in lieu of the deduction under Section 263(c) of the Internal Revenue Code. (19624)

CHAPTER 3. THE CORPORATION INCOME TAX (19625)(Text)

Article 1. Imposition of Tax (23501-23504) (19626)(Text)

23501. (a) There shall be imposed upon every corporation, other than a bank, for each taxable year, a tax at the rate of 7.6 percent upon its net income derived from sources within this state on or after January 1, 1937, other than income for any period for which the corporation is subject to taxation under Chapter 2 (commencing with Section 23101), according to or measured by its net income. (19627)

(b) For calendar or fiscal years ending after June 30, 1973, the rate of tax shall be 9 percent instead of 7.6 percent as provided by subdivision (a). (19628)

(c) For calendar or fiscal years ending after December 31, 1979, the rate of tax shall be the rate specified for those years by Section 23151. (19629)

23503. There shall be offset against the tax hereby imposed for any period the amount of any tax imposed on the taxpayer under Chapter 2 for the same period. In the event that taxes, interest and penalties have been or shall be assessed against, paid by or collected from a taxpayer under this chapter, which assessment, payment or collection should have been made under Chapter 2, such taxes, interest and penalties shall be considered as having been assessed, paid or collected under Chapter 2 as of the date or dates they were made. (19630)

23504. Where a corporation formerly subject to tax under Chapter 2 (commencing with Section 23101) becomes subject to tax under Chapter 3 (commencing with Section 23501), the tax for the year in which the change occurs will be assessed under Chapter 2 (commencing with Section 23101) and not under Chapter 3 (commencing with Section 23501). For years subsequent to the year in which the change occurs, the tax will be assessed under Chapter 3 (commencing with Section 23501). (19631)

Article 2. Cessation of Activities (23561) (19632)(Text)

23561. No decree of dissolution shall be made and entered by any court, nor shall the county clerk of any county or the Secretary of State file any such decree, or file any other document by which the term of existence of any taxpayer shall be reduced or terminated, nor shall the Secretary of State file any certificate of the surrender by a foreign corporation of its right to do intrastate business in this State if the corporate powers, rights, and privileges of the corporation have been suspended or forfeited by the Franchise Tax Board for failure to pay the tax, penalties, or interest due under this part or Part 10.2 (commencing with Section 18401). (19633)

Article 3. Suspensions (19634)(Text)

CHAPTER 3.5. TAX CREDITS (23604-23685) (19635)(Text)

23604. For each taxable year beginning on or after January 1, 1996, there shall be allowed as a credit against the "tax" (as defined by Section 23036) an amount determined as follows: (19636)

(a) (1) (A) The amount of the credit shall be equal to one-third of the federal credit computed in accordance with Section 43 of the Internal Revenue Code. (19637)

(B) If a taxpayer elects, under Section 43(e) of the Internal Revenue Code, not to apply Section 43 for federal tax purposes, this election is binding and irrevocable for state purposes, and for purposes of subparagraph (A), the federal credit shall be zero. (19638)

(2) "Qualified enhanced oil recovery project" shall include only projects located within California. (19639)

(3) The credit allowed under this subdivision shall not be allowed to any taxpayer for whom a depletion allowance is not permitted to be computed under Section 613 of the Internal Revenue Code by reason of paragraphs (2), (3), or (4) of subsection (d) of Section 613A of the Internal Revenue Code. (19640)

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