California law gives local newsrooms, nonprofit ones included, a refundable tax credit for each journalist they employ
Gov. Gavin Newsom signed Assembly Bill 2222 on Sept. 30. For tax years 2027 through 2031, qualifying outlets can claim $20,000 for each of their first five full-time journalists, $15,000 for each one after that and more for new positions; tax-exempt newsrooms receive it as a refund.
Sacramento. Local news outlets in California, nonprofit newsrooms among them, will be able to claim a refundable state tax credit for each journalist they employ, under a law Gov. Gavin Newsom signed on Sept. 30. The credit runs for taxable years 2027 through 2031.
Assembly Bill 2222, by Assemblymembers Christopher Ward, a Democrat from San Diego, and Buffy Wicks, a Democrat from Oakland, is now Chapter 849 of the Statutes of 2026. Mr. Newsom signed it in his office with members of the Capitol Press Corps present, his office said.
What an outlet can claim
An outlet may claim $20,000 for each of up to five qualifying journalists kept on full time from the previous year, and $15,000 for each one beyond five. It may claim another $15,000 for each new full-time position, counted as growth in its average number of journalists over the prior year, and $7,500 for each part-time journalist. Full time means at least 30 hours a week for more than 26 weeks at annualized pay of at least $35,000. A qualifying journalist must live in California and mainly gather, write, edit, photograph or present state or local news there.
The outlet must be a print publication, a broadcast station or a digital outlet with at least a third of its audience in the state, and must have been organized or registered in California for at least 12 months. It must carry media liability insurance, publish a policy for correcting errors, and disclose its owners or, for a nonprofit, its board of directors. Outlets controlled by a political committee or other Section 527 organization, or by a 501(c)(4) social welfare organization, are excluded.
How nonprofits claim it
The law counts a tax-exempt organization that runs a qualifying outlet as engaged in business for the credit, and pays out whatever exceeds its tax as a refund, whether or not it has unrelated business income. The Franchise Tax Board must issue guidance by Jan. 1, 2028, on how 501(c)(3) organizations claim the credit and receive refunds.
Print, broadcast, digital and nonprofit newsrooms that produce original reporting qualify, CalMatters reported. Matt Pearce, a policy director at Rebuild Local News, a nonprofit, called it the largest investment in local journalist jobs by any state.
In his signing message, Mr. Newsom wrote that the law has no cap on its overall cost and is not tailored to the organizations most in need, and that it could bring windfalls to larger outlets owned by hedge funds and billionaires.
“While I am signing this measure to help revive local journalism, the state will need follow-up legislation to address flaws that jeopardize the long-term viability of this new program.”
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