Laws, Regulations & Annotations

Property Taxes Law Guide – Revision 2013
 

Revenue and Taxation Code

Division 2. Other Taxes

Part 11. Bank and Corporation Tax Law

Chapter 2. The Bank and Corporation Franchise Tax

Article 3. Tax on Banks and Financial Corporations*

Section 23181

23181. Banks; imposition on net income; method of taxing national banking associations; tax on bank ceasing business, dissolving or withdrawing; minimum tax. (a) Except as otherwise provided herein, an annual tax is hereby imposed upon every bank doing business within the limits of this state according to or measured by its net income, upon the basis of its net income for the next preceding income year at the rate provided under Section 23186.

(b) If a bank commences to do business and ceases doing business in the same taxable year, the tax for such taxable year shall be according to or measured by its net income for such year, at the rate provided under Section 23186.

(c) With respect to a bank, other than a bank described in subdivision (b), which ceases doing business after December 31, 1972, the tax for the taxable year of cessation shall be:

(1) According to or measured by its net income for the next preceding income year, to be computed at the rate prescribed in Section 23186, plus

(2) According to or measured by its net income for the income year during which the bank ceased doing business, to be computed at the rate prescribed in Section 23186.

(d) In the case of a bank which ceased doing business before January 1, 1973, but dissolves or withdraws on such date or thereafter, the tax for the taxable year of dissolution or withdrawal shall be according to or measured by its net income for the income year during which the bank ceased doing business, unless such income has previously been included in the measure of tax for any taxable year, to be computed at the rate prescribed under Section 23186 for the taxable year of dissolution or withdrawal.

(e) Commencing with income years ending in 1980, every bank shall pay to the state a minimum tax (determined in accordance with Section 23153) or the measured tax imposed on its income, whichever is greater.

(f) (1) For the first taxable year beginning on or after January 1, 2000, the tax imposed under this section shall be the sum of both of the following:

(A) A tax according to or measured by net income, to be computed at the rate provided under Section 23186 upon the basis of the net income for the next preceding income year, but not less than the minimum tax specified in Section 23153.

(B) A tax according to or measured by net income, to be computed at the rate provided under Section 23186 upon the basis of the net income for the first taxable year beginning on or after January 1, 2000, but not less than the minimum tax specified in Section 23153.

(2) Except as provided in paragraph (1), for taxable years beginning on or after January 1, 2000, the tax imposed under this section shall be a tax according to or measured by net income, to be computed at the rate provided under Section 23186 upon the basis of the net income for that taxable year, but not less than the minimum tax specified in Section 23153.

History.—Amended by Stats. 1971, Ch. 1304, in effect October 29, 1971. Amended by Stats. 1972, Ch. 773, in effect March 7, 1973. Amended by Stats. 1977, Ch. 552, in effect September 3, 1977. Stats. 1979, Ch. 1150, in effect September 29, 1979, added subdivision (e). Stats. 1987, Ch. 1442, in effect January 1, 1988, substituted "doing business" for "located" after "bank", and deleted "with respect to the taxation of national banking associations, the state adopts the method numbered (4) authorized by the act of March 25, 1926, amending Section 5219 of the Revised Statutes of the United States, Title 12, Section 548, United States Code." from the end of subdivision (a). Stats. 1988, Ch. 1465, in effect September 28, 1988, substituted "(determined in accordance with Section 23153)" for "of two hundred dollars ($200)" after "tax" in subdivision (e). Stats. 2000, Ch. 862 (AB 1843), in effect January 1, 2001, added subdivision (f).

* Article 3 was added by Stats. 1949, Ch. 557, in effect October 1, 1949.