Did teaching elementary and secondary basic-skills courses at a California district adult school qualify as teaching at an eligible school for the former teacher retention credit?

Plain-English summary

California Chief Counsel Ruling 20030318 concluded that a district adult school's elementary and secondary basic-skills program was a qualifying educational institution for California's former teacher retention credit.

The teacher could claim the credit if the credential she held was a preliminary or professional clear credential and she had completed at least four years of service as a credentialed teacher.

FTB focused on the program's place in California's elementary and secondary school system and the K-12-level curriculum it delivered, not solely on the adult age of its students.

The teacher and program

The redacted taxpayer worked full time for a California unified school district at an adult school.

She held a full-time adult-education credential in designated subjects and exclusively taught elementary and secondary basic-skills programs.

The narrow question was whether that adult-school teaching occurred at a qualifying educational institution under section 17052.2.

Requirements for the former credit

The ruling stated that the former teacher retention credit required:

• A current preliminary or professional clear credential determined by the Commission on Teacher Credentialing.
• At least four years of service as a credentialed teacher.
• Teaching at a qualifying educational institution.

The statute defined a qualifying institution as a California elementary, secondary, or vocational-technical school providing kindergarten through grade 12 education, or any part of that range.

Why the adult school qualified

California's Education Code established adult schools under the elementary and secondary education title and authorized unified and high-school districts to operate them.

The programs could provide civic, vocational, literacy, health, homemaking, technical, and general education. They could also establish elementary and secondary graduation criteria and issue completion certificates.

The ruling cited the definition of adult basic education as communication and computational skills through the 12th-grade level, including English as a second language.

FTB therefore treated the district adult-education program as a secondary or vocational-technical school providing K-12-level education within California.

Holding

An adult-education teacher in the elementary and secondary basic-skills program qualified for the former section 17052.2 credit if the teacher:

1. Held a preliminary or professional clear teaching credential.
2. Had at least four years of credentialed teaching service.
3. Taught in the qualifying district adult-school program described in the ruling.

The ruling did not dispense with the credential or service requirements.

What this means for you

Adult-education teachers

The ruling recognized that adult-school programs can deliver elementary and secondary education even though their students are adults.

School districts

Program authority, grade-level curriculum, district operation, and completion credentials were important to the institution analysis.

Tax preparers

This ruling concerns a historical credit and 2004 facts. Verify whether any current educator credit exists and apply its current statutory definitions rather than assuming section 17052.2 remains available.

Common questions

Q: Did teaching adults automatically disqualify the teacher?

A: No. The program delivered elementary and secondary basic-skills education within the state school system.

Q: Was any adult-education credential sufficient?

A: The ruling conditioned eligibility on the credential qualifying as preliminary or professional clear under the statute.

Q: How much teaching service was required?

A: At least four years as a credentialed teacher.

Q: Why was the adult school a qualifying institution?

A: It was district-operated, part of California's school system, provided K-12-level curriculum, and could issue elementary or secondary completion certificates.

Q: Does this page establish a current credit?

A: No. It summarizes a taxpayer-specific 2004 ruling under a former credit provision.

Citations and references

• Cal. Rev. & Tax. Code § 17052.2
• Cal. Educ. Code §§ 44200 et seq.
• Cal. Educ. Code §§ 52500-52616.24
• Cal. Educ. Code §§ 52508-52510 and 8510
• 2000 Cal. Stat. chs. 75 and 603

Source

• Landing page: Chief Counsel Ruling index
• Official ruling: Chief Counsel Ruling 20030318

Original ruling text

STATE OF CALIFORNIA
STEVE WESTLY
FRANCHISE TAX BOARD – Legal Department
Chair
PO Box 1720
Rancho Cordova, CA 95741-1720
CAROLE MIGDEN
Telephone (916) 845-3066
Member
FAX (916) 843-2122
DONNA ARDUIN
Member

March 29, 2004
Chief Counsel Ruling 20030318

Re: ****

Dear ***:

This chief counsel ruling is issued in response to your request for a determination regarding your eligibility to claim the "Teacher Retention Credit" on your **** California personal income tax return.

FACTS

You have provided us with the following information. Your Social Security number is
**. You hold a full-time teaching credential for adult education in clear designated subjects and are employed by the * Unified School District as a full time adult education teacher at the ** Adult School (CDS
*******). In this capacity, you exclusively teach the elementary and secondary basic skills programs.

ISSUE

Is a properly credentialed teacher, teaching in the elementary and secondary basic skills programs of the adult education system, eligible to claim a credit (the "teachers retention credit") pursuant to Revenue and Taxation Code section 17052.2?

HOLDING

An individual who holds either a preliminary or clear teaching credential and has at least four years of service as a credentialed teacher, and is teaching in the elementary and secondary basic skills programs of the adult education system, would qualify to claim the credit pursuant to Revenue and Taxation Code section 17052.2, the "teacher retention credit."

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DISCUSSION

Revenue and Taxation Code section 17052.2, added by AB 2879 (Stats. 2000, ch. 75), and amended by AB 1080 (Stats. 2000, ch. 603), provides a credit against the "net tax" imposed under the Personal Income Tax Law for credentialed teachers who teach at qualifying educational institutions. This credit is only available to credentialed teachers who have completed at least four years of service as a credentialed teacher.

Paragraph (1) of subdivision (c) of Revenue and Taxation Code section 17052.2 defines "credentialed teacher" as:

…a person who holds a preliminary or professional clear credential as determined by the Commission on Teacher Credentialing pursuant to Article 1 (commencing with Section 44200) of Chapter 2 of Part 25 of Division 2 of Title 2 of the Education Code and who teaches at a qualifying educational institution. (Emphasis added.)

As a threshold matter, only credentialed teachers, as defined, are eligible for the teacher retention credit. An individual cannot be considered a "credentialed teacher” unless the individual possesses a current "preliminary" or "professional clear” credential, as determined by the Commission on Teacher Credentialing.

Paragraph (2) of subdivision (c) of section 17052.2 defines a "qualifying educational institution" as:

…any elementary, secondary, or vocational-technical school located in this state providing education for kindergarten, grades 1 to 12, inclusive, or any part thereof. "Qualifying educational institution" includes an agency or instrumentality of the federal government providing education for grades kindergarten, grades 1 to 12, inclusive, or any part thereof, at any location within this state, including an Indian reservation or a military installation located within the geographical borders of this state, where a credentialed teacher is employed by the federal government or an agency or instrumentality thereof. "Qualifying educational institution" includes any elementary, secondary, or vocational technical school located in California, that files an affidavit pursuant to Section 33190 and 33191 of the Education Code, and provides education for kindergarten and grades 1 to 12, inclusive, or any part thereof.

The definition of "qualifying educational institution" requires an elementary, secondary, or vocational-technical school that provides a particular type of education – education for kindergarten, grades 1 through 12, inclusive, or any part thereof.

Title 2 of the Education Code (commencing with section 33000), entitled “Elementary and Secondary Education,” sets forth requirements and criteria relating to and establishing the

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standards for elementary and secondary 1 education. Among other topics, it addresses teacher credentialing, course of study for kindergarten and grades 1 through 12, funding, and various education programs designed to meet the needs of special populations. Specifically, at sections 52500 through 52616.24, it establishes the "Adult Schools" for the "purpose of providing instruction in civic, vocational, literacy, health, homemaking, technical and general education." (Ed. Code section 52501.) These programs are to be established and administered by the governing board of a high school district or unified school district. (Ed. Code section 52500 et seq.) Further, these programs are authorized to establish graduation criteria for the elementary and secondary levels for the issuance of graduation certificates by the governing board of the adult school. (Ed. Code section 52508-52510.)

Further, "adult basic education" is defined in Education Code § 8510 as communication and computational skills to and including the 12th grade level. This specifically includes English as a second language.

Furthermore, the adult education programs operated by school districts are specifically provided for within the funding mechanisms as administered by the Superintendent of Public Instruction (including, but not limited to, Education Code sections 44700-44705, 52360–52363, and 52610– 52616.24).

Thus, in order for you to qualify for the teacher retention credit, you must be a properly credentialed teacher, teaching in a "school" that meets each of the following criteria:

1. The school must be an established organization operated for the purpose of learning and education.
2. The school must be considered to be an elementary, secondary, or vocational- technical school.
3. The school must provide education from the curriculum for kindergarten, grades 1 through 12, or any part thereof.

The adult education program is created under the specific authority of the Education Code to provide education for adults 2 within the curriculum for elementary and secondary education. The program is authorized to be a part of the state school system and funded through that system.

Further, as acknowledged above, the adult system is authorized to award diplomas or certificates for the satisfactory completion of the elementary or secondary course of study.

Therefore, based on the program as established pursuant to the Education Code, an adult education program under the auspices of a unified school district is a secondary school or

1
In this context, the term "secondary" refers to the grades 9 through 12, or "high school." Postsecondary education, i.e., education past the 12th grade level, is addressed in title 3 of the Education Code. 2 There are special provisions which can also make this program available to minors if they meet the detailed criteria pursuant to Education Code section 52500.1

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vocational-technical school providing education for kindergarten, grades 1 through 12, or any part thereof, at locations within California. Thus, such programs are considered “qualifying educational institutions” for purposes of the teacher retention credit.

As a result, if the credential you hold constitutes either a preliminary or professional clear teaching credential and you have at least four years of service as a credentialed teacher, based on the facts set forth above, your teaching in the elementary and secondary basic skills programs of the adult education system would qualify you to claim the credit pursuant to Revenue and Taxation Code section 17052.2, the "teacher retention credit."

Please be advised that the tax consequences expressed in this Chief Counsel Ruling are applicable only to the named taxpayer and are based upon and limited to the facts you have submitted. In the event of a change in relevant legislation, or judicial or administrative case law, a change in federal interpretation of federal law in cases where our opinion is based upon such an interpretation, or a change in the material facts or circumstances relating to your request upon which this opinion is based, this opinion may no longer be applicable. It is your responsibility to be aware of these changes, should they occur.

This letter is a legal ruling by the Franchise Tax Board's Chief Counsel within the meaning of paragraph (1) of subdivision (a) of section 21012 of the Revenue and Taxation Code. Please attach a copy of this letter and your request to the appropriate return(s) (if any) when filed, or in response to any notices or inquiries which might be issued.

Very truly yours,

Suzanne L. Small