CA AB2042

Allows a personal income tax credit equal to 25% of the cost of installing a residential graywater reuse system in the taxpayer's residence, capped at $1,000 per residence for taxable years 2019-2023.

Requires taxpayers to apply to the Franchise Tax Board for the credit and submit documentation including the system cost, name, address, and Social Security number or federal employer identification number.

Limits total credits certified by the Franchise Tax Board to $250,000 per calendar year, with applications processed on a first-come, first-served basis.

Allows unused credits to carry over to the following five taxable years if the credit exceeds the taxpayer's net tax in any year.

Requires the residential graywater reuse system to comply with rules adopted by the Department of Housing and Community Development relating to graywater recovery and disposal.