SB 1316 Summary

• Excludes out-of-state real property from California's like-kind property exchange (1031 exchange) tax benefits for taxable years beginning January 1, 2011 through December 31, 2011, generating revenue from investors who exchange California property for out-of-state property.

• Creates the California New Markets Tax Credit Program allowing a 39 percent tax credit against personal income and corporate taxes for qualified equity investments in low-income communities during taxable year 2011.

• Defines qualified investments as equity stakes in community development entities that invest substantially all funds into low-income community businesses and projects in California.

• Grants the California Tax Credit Allocation Committee authority to allocate credits, establish reasonable application fees to cover administrative costs, and prioritize applicants with successful records assisting disadvantaged businesses.

• Appropriates $150,000 from the Tax Credit Allocation Fee Account to the committee to implement the new tax credit program, with funds available only until January 1, 2012.