Governor Brown Vetoes California A.B. 99

 Posted on December 03, 2015 in Taxation Law

Are you concerned that a recent decision by California Governor Jerry Brown may impact your taxliabilities? A.B. 99 was a bill written to bring California into compliance with federal rules regardingcancellation of debt income (CODI) related to mortgage debt forgiveness. Though the bill was approvedby state legislators, Governor Brown cited the need for California's continued tax revenue as the reasonhe is not granting this tax relief. Many tax payers anticipated the governor's signing of the bill. Manymay not have accounted for the mortgage debt relief to be counted as income. This may createincreased tax responsibilities. If you believed that A.B. 99 was going to be signed into law and you havenot made appropriate tax payments to the California Franchise Tax Board, you may need a California taxattorney.

Currently, California tax law does not conform to federal exclusions for income from the discharge ofqualified principal residence indebtedness occurring after 2013. California taxpayers with cancellation ofdebt income who anticipated the implementation of A.B. 99 may not have made their payments beforethe due date of the return. This may lead to penalties for the 2014 tax year.To get answers about California's A.B. 99 and how its veto might impact your tax responsibilities,contact California Tax Attorney John D. Teter.