This law section specifies how certain portions of the federal Internal Revenue Code about deferred compensation, pensions, and profit-sharing plans are to be applied in California. It explains that the rules for excluding elective deferrals from income for state tax follow federal rules from January 1, 2010. Before 2025, the amount you can defer is capped at the older federal limits. From 2002 onward, if you couldn't exclude deferred amounts, you can add them to your plan basis, which affects tax calculations when you withdraw funds. Income from deferred compensation isn’t taxed until distributed. It also clarifies rules around Roth IRA rollovers, stating that certain rollovers won’t increase the Roth IRA basis and must be included as income when distributed.

This California law states that certain amendments from the Economic Growth and Tax Relief Reconciliation Act of 2001 will affect specific tax-related topics, applying to distributions made after December 31, 2001. These include areas related to annuities, retirement savings, pension plans, employee trusts and annuities, IRAs, contribution limits on qualified plans, and deferred compensation plans for government and tax-exempt organizations. Some specifics from the Tax Reform Act of 1986 are also included.

This law states that changes made by a 2001 federal law to parts of the Internal Revenue Code will apply to California tax laws concerning specific types of financial transfers, specifically trustee-to-trustee transfers, made after December 31, 2001. These provisions include rules on how employee annuities and deferred compensation plans for certain organizations are taxed.

This section of the law aligns California's tax rules with changes made at the federal level by the Consolidated Appropriations Act, 2023. It specifically updates rules for retirement accounts, including increasing the catch-up contribution limits for IRAs and retirement plans for older individuals and adjusting limits for simple plans.

The goal is to streamline the differences between how retirement accounts are treated for state versus federal tax purposes, reducing tax mismatches. The success of this alignment will be measured by looking at how many taxpayers can take advantage of these expanded deductions and the total amount of contributions made under the new rules.

The Legislative Analyst’s Office is tasked with reporting back to the legislature by October 1, 2029, with an analysis of the impact of these changes, including how many taxpayers benefit from these updates.

This law section defines 'California qualified stock options' and explains how they are treated for tax purposes. If an employee earns less than $40,000 from the corporation granting the stock option, specific favorable regulations apply, similar to certain federal stock option rules. These options must be granted between 1997 and 2002, have a fair market value under $100,000, and not exceed 1,000 shares. The law specifies that the income from these options isn't taxed until they're sold, and the employer can't deduct the grant or exercise of these options as a business expense. However, if an election under Section 83(b) of the IRS code is made, these provisions don't apply.

This law outlines how California modifies the federal rules on the taxation of beneficiaries of employee trusts. It specifies that changes made by past federal laws apply in California as they do at the federal level, unless stated otherwise. For contributions made before 1987 and not deducted under specific conditions, these are included in the trust's basis.

Additionally, there is a specific tax on lump-sum distributions which uses California’s tax rates and brackets instead of the federal rates. This tax is applied at a modified rate of 5.5% and is the responsibility of the person receiving the distribution. Any rules from past federal laws affecting the state's tax code are also modified as specified to align with California's tax sections and rates.

This law changes how employee annuities are taxed by including some past contributions in their value. Specifically, it adds contributions made before 1987, which weren't tax-deductible under older rules, into the annuity's base value for tax purposes.

This law section modifies certain parts of the federal rules about individual retirement accounts (IRAs) for California tax purposes. It says that income from contributions to certain retirement plans isn't included in taxable income until it's actually paid out to you. This is for IRAs set up under specific laws dating back to the 1970s and 1980s, as well as simplified employee pensions. Even if some contributions weren't deductible at first, their profit will still be tax-free until you withdraw it. The section also clarifies how to handle tax reporting related to these retirement accounts and emphasizes filing requirements with the Franchise Tax Board.

This section of the California tax code states that the rules for nondeductible contributions to individual retirement plans, as defined in Section 408(o) of the Internal Revenue Code, also apply in California. Taxpayers must report these contributions in their tax return, following the specific timing and manner outlined in Chapter 2 (starting with Section 18501) of Part 10.2 of the California tax code.

This law modifies certain parts of Section 409A of the Internal Revenue Code, specifically changing how much tax is applied. Starting from taxable years beginning on January 1, 2013, the tax rate mentioned in two specific parts of the code is reduced from 20 percent to 5 percent. This change affects specific nonqualified deferred compensation plans that don't meet certain requirements.

This law section clarifies that certain parts of the Internal Revenue Code, which deal with who is responsible for funding taxes, are not applicable here.

This section of the California law states that the rules about Federal Thrift Savings Funds from the Internal Revenue Code are applicable, unless there's something else specified.