AMENDED IN SENATE APRIL 23, 2026

CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION

98

TAX LEVY

Introduced by Senator Dahle

February 13, 2026

An act to add and repeal Section 17052.8 to of the Revenue and Taxation Code, relating to taxation, and making an appropriation therefor. to take effect immediately, tax levy.

Vote: majority   Appropriation: no   Fiscal committee: yes   Local program: no

LEGISLATIVE COUNSEL’S DIGEST

The Personal Income Tax Law allows various credits against the taxes imposed by that law. Existing law establishes the continuously appropriated Tax Relief and Refund Account and provides that payments required to be made to taxpayers or other persons from the Personal Income Tax Fund are to be paid from that account.

This bill would allow a credit against those taxes to a licensed nurse employed at a rural health facility, as specified, for each taxable year beginning on or after January 1, 2027, in an unspecified amount. The bill would require the amount of the credit exceeding the taxpayer’s liability to be credited against other amounts due, if any, and would require the balance to be paid from the Tax Relief and Refund Account and refunded to the taxpayer. By increasing the payments from the Tax Relief and Refund Account, a continuously appropriated fund, the bill would make an appropriation. and before January 1, 2032, in an amount equal to $2,000 per taxpayer per taxable year. The bill would require the Department of Health Care Access and Information to provide an annual list to the Franchise Tax Board of rural health facilities, as specified.

Existing law requires any bill authorizing a new tax expenditure, as defined, to include tax credits, to contain, among other things, specific goals, purposes, and objectives that the tax credit will achieve, detailed performance indicators, and data collection requirements.

This bill would include findings and reporting requirements in compliance with this requirement.

The people of the State of California do enact as follows:

SECTION 1.

Section 17052.8 is added to the Revenue and Taxation Code, to read:

17052.8.

(a) For each taxable year years beginning on or after January 1, 2027, and before January 1, 2032, there shall be allowed as a credit against the “net tax,” as defined in Section 17039, to a qualified taxpayer an amount equal to ____ dollars ($____). two thousand dollars ($2,000) per taxpayer per taxable year.

(b) For purposes of this section, the following shall apply:

(5) “Qualified taxpayer” means a taxpayer who is meets all of the following criteria:

(A) They are licensed pursuant to Chapter 6 (commencing with Section 2700) or Chapter 6.5 (commencing with Section 2840) of Division 2 of the Business and Professions Code and is Code.

(B) They were employed on a full-time basis at a rural health facility in a position for which that license is required at a rural health facility for at least six months of the taxable year. a license described in subparagraph (A) is required.

(6) “Rural health facility” means a rural general acute care hospital, as defined in Section 1250 of the Health and Safety Code, or a health care facility located in an area federally designated as a health professional shortage area, medically underserved area, or medically underserved population, including, but not limited to, a critical access hospital or a rural health clinic. hospital defined as having a “rural” or “frontier” designation status in the Medical Service Study Area created by the Department of Health Care Access and Information or as set forth in Section 1250 of the Health and Safety Code.

(e) For purposes of complying with Section 41, the Legislature finds and declares the following:

(1) The goals, purposes, and objectives of the tax credit allowed by this section include the following:

(A) To increase recruitment and long-term retention of licensed nurses in rural and frontier California, stabilize staffing in rural health care facilities, and improve access to care in rural medical service study areas and health professional shortage areas.

(B) To address chronic rural health care workforce shortages through direct financial incentives, improve workforce stability in rural hospitals, clinics, and health centers, and to reduce service disruptions caused by staffing shortages.

(C) To increase the number of nurses practicing in qualifying rural facilities, reduce vacancy and turnover rates, increase the average length of rural employment, and improve continuity of patient care.

(2) The performance indicators for the Legislature to use in determining whether the credit achieves the stated objective include the following:

(A) Workforce metrics, including the number of licensed nurses, vacancy and turnover rates, average tenure, and time to fill vacancies.

(B) Facility metrics, including staffing levels, patient-to-nurse ratios, and service continuity.

(C) Patient access metrics, including care delays, emergency diversion incidents, and readmission rates.

(3) (A) No later than June 30, 2029, and each June 30 thereafter, the Department of Health Care Access and Information, in collaboration with the Franchise Tax Board, shall submit a report to the Legislature, in compliance with Section 9795 of the Government Code, and to the extent feasible, containing the data described in paragraph (2) and the number of taxpayers that claimed the tax credit pursuant to this section for the most recent taxable year.

(B) The disclosure provisions of this paragraph shall be treated as an exception to Section 19542.

SEC. 2.