Personal Income Tax Law: Corporation Tax Law: Bobcat Fire: exclusions.

Assembly Member Lackey's proposal to exclude Bobcat Fire settlements from state taxation addresses the financial aftermath of the 2020 wildfire that affected Los Angeles County residents and businesses. The legislation creates a five-year tax exclusion window for settlement payments received from Southern California Edison related to fire damages and expenses.

The tax exclusion applies to three categories of recipients: property owners, residents, and businesses that operated in Los Angeles County during the 2020 Bobcat Fire and received settlement payments for associated costs and losses. Southern California Edison, as the designated settlement entity, must provide documentation of these payments to the Franchise Tax Board upon request. The exclusion period runs from January 1, 2024 through January 1, 2029.

To measure the program's implementation, the Franchise Tax Board must submit a report to the Legislature by December 1, 2029, detailing the number of taxpayers who utilized the exclusion and the total amount of settlement payments excluded. The legislation includes an urgency clause for immediate implementation upon passage, with both new tax code sections automatically repealing on December 1, 2029.