Bills · 2009-2010 Regular Session

AB 648

Died at session end Official bill text Atom feed

adopting Internal Revenue Code provisions related to individual retirement accounts and adopting provisions of the Heroes Earnings Assistance and Relief Tax Act of 2008 for state income and franchise tax purposes.

Introduced, stopped here
Passes Assembly, not reached
Passes Senate, not reached
Governor signs, not reached
Law, not reached

Unfamiliar terms? Glossary

What this bill does

Plain-language analysis by the nonpartisan Legislative Reference Bureau

Under federal law, section 512 of Public Law 109-222, the Tax Increase

Prevention and Reconciliation Act of 2005, allows taxpayers who have adjusted gross

income over $100,000 to convert amounts from a traditional individual retirement

account (IRA) to a Roth IRA and pay the federal tax on the IRA distribution over two

years. This bill adopts section 512 of Public Law 109-222 for state income and

franchise tax purposes.

This bill also adopts, for state income and franchise tax purposes, changes to

the Internal Revenue Code, made by the federal Heroes Earnings Assistance and

Relief Tax Act of 2008, that do all of the following:

1. Makes permanent the provision that allows members of the National Guard

and the U.S. military reserves to make, without penalty, withdrawals from

individual retirement accounts (IRAs), if they are called to active duty for a period

that exceeds 179 days.

2. Allows individuals who receive a military death gratuity to contribute that

amount to a Roth IRA, notwithstanding the annual contribution limit that would

otherwise apply.

3. Allows reservists called to active duty to withdraw amounts from their

health flexible spending accounts without incurring penalties.

4. Excludes from gross income any state or local bonus payment made to

members of the U.S. military or their dependents, if the payment was made because

of the member's service in a combat zone.

Because this bill relates to an exemption from state or local taxes, it may be

referred to the Joint Survey Committee on Tax Exemptions for a report to be printed

as an appendix to the bill.

What it would cost

Fiscal estimates filed by state agencies, as official PDFs

Fiscal Estimate From DOR

Votes

Assembly: Report Assembly Amendment 1 adoption recommended by committee on Jobs, the Economy and Small Business, Ayes 10, Noes 0

Passed 10–0 Feb 9, 2010 official source full page

No individual roll call was recorded for this vote. Committee votes and some older sessions record totals only.

Assembly: Report Assembly Amendment 1 adoption recommended by joint committee on Finance, Ayes 16, Noes 0

Passed 16–0 Feb 17, 2010 official source full page