The California Constitution limits the amount of ad valorem taxes on real property to 1% of the full cash value of that property, defined as the county assessors valuation of real property as shown on the 197576 tax bill and, thereafter, the appraised value of the real property when purchased, newly constructed, or a change in ownership occurs after the 1975 assessment, subject to an annual inflation adjustment not to exceed 2%.

Pursuant to constitutional authorization, existing property tax law, on and after February 16, 2021, excludes from classification as a change in ownership the purchase or transfer of a family home or family farm, as those terms are defined, of the transferor in the case of a transfer between parents and their children, or between grandparents and their grandchildren if all the parents of those grandchildren are deceased, if the property continues as the family home or family farm of the transferee, as specified. For purposes of the transfer of a family home, that law requires the transfer to be of a principal residence of the transferor and to become the principal residence of the transferee within one year of the transfer. That law also requires the transferee to file for the homeowners or disabled veterans exemption within a year of the transfer, as described.

This bill would provide that, in the event of a transfer to an eligible transferee as a result of the death of an eligible transferor by an order entered pursuant to specified existing law, that the one-year periods described above shall be deemed to commence as of the end one year after the effective date of the order, as specified. certain court orders resolving the disposition of the property if the eligible transferee files specified documents with the assessor, including a copy of a court order indicating that a probate matter prohibited the eligible transferee from establishing the property as their principal place of residence within the one-year period described above. By expanding the duties of local tax officials, the bill would impose a state-mandated local program.

Existing law requires the state to reimburse local agencies annually for certain property tax revenues lost as a result of any exemption or classification of property for purposes of ad valorem property taxation.

This bill would provide that, notwithstanding those provisions, no appropriation is made and the state shall not reimburse local agencies for property tax revenues lost by them pursuant to the bill.

This bill would take effect immediately as a tax levy.

The California Constitution limits the amount of ad valorem taxes on real property to 1% of the full cash value of that property, defined as the county assessors valuation of real property as shown on the 197576 tax bill and, thereafter, the appraised value of the real property when purchased, newly constructed, or a change in ownership occurs after the 1975 assessment, subject to an annual inflation adjustment not to exceed 2%.

Pursuant to constitutional authorization, existing property tax law, on and after February 16, 2021, excludes from classification as a change in ownership the purchase or transfer of a family home or family farm, as those terms are defined, of the transferor in the case of a transfer between parents and their children, or between grandparents and their grandchildren if all the parents of those grandchildren are deceased, if the property continues as the family home or family farm of the transferee, as specified. For purposes of the transfer of a family home, that law requires the transfer to be of a principal residence of the transferor and to become the principal residence of the transferee within one year of the transfer. That law also requires the transferee to file for the homeowners or disabled veterans exemption within a year of the transfer, as described.

This bill would provide that, in the event of a transfer to an eligible transferee as a result of the death of an eligible transferor by an order entered pursuant to specified existing law, the one-year periods described above shall be deemed to commence as of the effective date of the order, as specified. The bill would require a transferee to notify the assessor of the county in which the property is located of their intention to claim the exclusion, as specified. By expanding the duties of local tax officials, the bill would impose a state-mandated local program.

Existing law requires the state to reimburse local agencies annually for certain property tax revenues lost as a result of any exemption or classification of property for purposes of ad valorem property taxation.

This bill would provide that, notwithstanding those provisions, no appropriation is made and the state shall not reimburse local agencies for property tax revenues lost by them pursuant to the bill.

This bill would take effect immediately as a tax levy.

The California Constitution limits the amount of ad valorem taxes on real property to 1% of the full cash value of that property, defined as the county assessors valuation of real property as shown on the 197576 tax bill and, thereafter, the appraised value of the real property when purchased, newly constructed, or a change in ownership occurs after the 1975 assessment, subject to an annual inflation adjustment not to exceed 2%.

Pursuant to constitutional authorization, existing property tax law, on and after February 16, 2021, excludes from classification as a change in ownership the purchase or transfer of a family home or family farm, as those terms are defined, of the transferor in the case of a transfer between parents and their children, or between grandparents and their grandchildren if all the parents of those grandchildren are deceased, if the property continues as the family home or family farm of the transferee, as specified. For purposes of the transfer of a family home, that law requires the transfer to be of a principal residence of the transferor and to become the principal residence of the transferee within one year of the transfer. That law also requires the transferee to file for the homeowners or disabled veterans exemption within a year of the transfer, as described.

This bill would provide that, in the event of the death of an eligible transferor, a transfer to an eligible transferee as a result of the death of an eligible transferor by an order entered pursuant to specified existing law, the transfer commencing either of the above-described one-year periods periods described above shall be deemed to occur commence as of the effective date of a courts determination of the final ownership of the property, as specified. effective date of the order, as specified. The bill would require a transferee to notify the assessor of the county in which the property is located of their intention to claim the exclusion, as specified. By expanding the duties of local tax officials, the bill would impose a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above.

Existing law requires the state to reimburse local agencies annually for certain property tax revenues lost as a result of any exemption or classification of property for purposes of ad valorem property taxation.

This bill would provide that, notwithstanding those provisions, no appropriation is made and the state shall not reimburse local agencies for property tax revenues lost by them pursuant to the bill.

This bill would take effect immediately as a tax levy.

Existing law generally authorizes a county tax collector to sell tax-defaulted property 5 years or more, or 3 years or more, as applicable, after that property has become tax defaulted, to any person, regardless of any prior or existing lien on, claim to, or interest in, the property, as specified. Existing law also generally authorizes the sale to certain entities of a property that has been tax defaulted for 5 years or more, or 3 years or more, as applicable, in an applicable county, including by authorizing the state, county, any revenue district the taxes of which on the property are collected by county officers, or a redevelopment agency, to purchase the property or any part thereof, as prescribed. Existing law also authorizes a nonprofit organization to purchase, with the approval of the board of supervisors of the county in which it is located, a residential or vacant property that has been tax defaulted for 5 years or more, or 3 years or more if the property is subject to a nuisance abatement lien, as prescribed. Existing law requires the sales price of a property sold pursuant to the provisions described or referenced above to include certain amounts, including all defaulted taxes and assessments and all associated penalties and costs.

This bill would prohibit a property or property interest from being offered for sale under the provisions described above unless at least one of several conditions are met, including that the property has been offered for sale under the provisions described above authorizing a sale to any person, or that the assessed value of the property is $10,000 or less.

Date of Hearing: August 5, 2026

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Buffy Wicks, Chair

SBPCA Bill Id:SB 288

Author:(Seyarto) – As Amended Ver:June 1, 2026

Urgency: No State Mandated Local Program: Yes Reimbursable: Yes

SUMMARY:

This bill extends the time period by which a property subject to a probate court order may be transferred to qualify for the intergenerational transfer property tax exclusion.

Specifically, this bill requires that the one-year period during which certain residency qualifications must occur, for purposes of claiming the intergenerational transfer exclusion under property tax law, be deemed to end one year after the effective date of a court order entered pursuant to the Probate Code resolving the disposition of the property, if the eligible transferee files the following documents with the county assessor:

1. The eligibility claim form for the intergenerational transfer exclusion;
2. A copy of a court order indicating that a probate matter prohibited the eligible transferee from establishing the property as their principal place of residence within the otherwise required one-year period; and,
3. The change-in-ownership statement required under existing law for a decedent’s real property subject to probate proceedings.

FISCAL EFFECT:

1. Annual property tax revenue loss of approximately $24 million. The State Board of Equalization (BOE) notes that the magnitude of costs depends on the year-to-year assessed value of each qualifying property and the number of applicable probate dispositions each year. Although property tax is a local government revenue source and this bill prohibits the state from reimbursing local agencies for lost property tax revenues, reductions in property tax revenues, in turn, increase General Fund (GF) Proposition 98 spending (the exact amount depends on the operative test of the annual Proposition 98 guarantee).
2. Costs of approximately $14,000 in fiscal year (FY) 2026-27, $2,000 in FY 2027-28, and $6,000 in FY 2028-29 to BOE to handle related transfer inquiries and administrative issues, including updating informational materials and guidance (GF).
3. By requiring a county assessor to accept certain documentation and modify assessment practices, this bill likely creates a state-mandated local program. If the Commission on State Mandates determines the provisions of this bill create a new program or impose a higher level of service for which the state must reimburse local costs, the county may seek reimbursement from the state (GF). The magnitude of such costs is unknown.

COMMENTS:

1. Purpose. According to the author:

SB 288 will provide protections for individuals who are not able to take ownership of a home because of a probate process. By adding clarity to Prop 19 this measure ensures that families preserve a valuable asset and are not unduly burdened by a tax reassessment because of a legal process with timelines outside their direct control.

This bill is supported by the BOE, California Assessors’ Association, and Howard Jarvis Taxpayers Association.

1. Background. Intergenerational Transfer Exclusion. Existing law provides several exclusions to the required reassessment of real property from its base-year value to its current market value when a change in ownership or new construction occurs. Since Proposition 13 (1978) caps the annual growth of a property’s assessed value and set the tax rate at 1% of assessed value, such exclusions allow the taxpayer to maintain significantly lower property tax bills. For example, the intergenerational base-year value transfer exclusion allows the base-year value of a decedent’s property to transfer to their child or grandchild without triggering full reassessment of the property. Prior to Proposition 19 (2020), the entire base-year value of a property could be transferred to the decedent’s transferee; however, Proposition 19 imposed a value limit for a transfer occurring on or after February 16, 2021, and requires the transferee to claim the homeowners’ or disabled veterans’ exemption (thus certifying the property will serve as the transferee’s principal residence) within one year of the transfer to qualify for the intergenerational transfer exclusion, among other changes.

Probate Proceedings. For a deceased person’s assets processed through standard probate proceedings, it may take years to fully adjudicate the ownership of assets. While a beneficiary may occupy a property going through probate under certain circumstances, the beneficiary is not the owner of the property until such an order is issued by the court. Thus, with regard to qualifying for the intergenerational transfer exclusion, an otherwise eligible transferee subject to probate administration may not be able to occupy or own the transferred property (and thus claim the homeowners’ exemption) within the one-year period required under existing law, even though the transferee intends the property to serve as their principal residence. This bill tolls, until the end of probate, the one-year period for the property to become the principal residence of the transferee and the transferee to file for the homeowners’ exemption, if certain documentation is filed with the county assessor, thus allowing the eligible transferee to qualify for the intergenerational transfer exclusion.

1. Related Legislation. SB 293 (Perez), Chapter 539, Statutes of 2025, extended the timeframe within which a claim for an intergenerational transfer exclusion must be deemed timely filed for certain properties impacted by the January 2025 Los Angeles-area wildfire disaster.

SB 284 (Seyarto) is similar to this bill, but prescribes a different standard and process by which the eligible transferee may qualify for the intergenerational transfer exclusion. SB 284 was held on the Assembly Revenue and Taxation Committee’s suspense file.

Analysis Prepared by: Irene Ho / APPR. / (916) 319-2081

Date of Hearing: June 29, 2026

ASSEMBLY COMMITTEE ON REVENUE AND TAXATION

Mike Gipson, Chair

SBPCA Bill Id:SB 288

Author:(Seyarto) – As Amended Ver:June 1, 2026

SUSPENSE

Majority vote. Tax levy. Fiscal committee.

SENATE VOTE: 40-0

SUBJECT: Property taxation: change in ownership: family homes and farms

SUMMARY: Clarifies the treatment of property subject to a court order entered pursuant to the Probate Code when transferring certain properties intergenerationally. Specifically, this bill:

1. Provides that the one-year period for an eligible transferee to occupy a property as their principal residence, and file the homeowners' or disabled veterans' exemption, is deemed to end one year after the effective date of a court order entered pursuant to the Probate Code resolving disposition of the property if the eligible transferee files with the assessor all of the following:
   1. An eligibility claim for the "intergenerational transfer exclusion" required under existing law;
   2. A copy of a court order indicating that a probate matter prohibited the eligible transferee from establishing the property as their principal place of residence within the one-year period described under existing law; and,
   3. A change-in-ownership statement required under existing law.
2. Corrects erroneous cross-references under existing law.
3. Requires reimbursement of local agencies and school districts for costs mandated by this bill, if the Commission on State Mandates determines that this bill contains costs mandated by the state.
4. Prohibits the state from reimbursing any local agency for any property tax revenues lost because of this bill.
5. Takes immediate effect as a tax levy.

EXISTING LAW:

1. Provides that all property is taxable unless otherwise stipulated by the California Constitution or the laws of the United States. (California Constitution, Article XIII, Section 1.)
2. Limits the maximum amount of ad valorem property taxation to 1% of the full cash value of the property. Generally, the Constitution restricts the full cash value of a property to the assessed value upon a change of ownership in, or new construction on, the property. This value is referred to as the base year value, which may be adjusted upwards for inflation at no more than 2% annually. (California Constitution, Article XIIIA, Sections 1 and 2.)
3. Excludes from the definition of change in ownership the purchase or transfer of a family home or family farm to a decedent's eligible child or grandchild. The exclusion is limited to $1 million of the increase in assessed value upon the purchase or transfer over the property's adjusted base year value; any additional assessed value is subject to taxation pursuant to existing law. To qualify, a decedent's child or grandchild, also termed a transferee, must occupy the property as their principal place of residence and claim the homeowner's or disabled veteran's exemption within one year of the transfer. Additionally, the transferee must file with the State Board of Equalization (BOE) claiming eligibility for the exclusion, generally within three years after the date of the purchase or transfer of the eligible real property, as conditioned. This exclusion applies to both voluntary transfers and transfers resulting from a court order or judicial decree, and is often referred to as the "intergenerational transfer exclusion." (California Constitution, Article XIIIA, Section 2.1. and Revenue and Taxation Code (R&TC) Section 63.2.)
4. Requires that, among other provisions, the personal representative of a decedent file a change-in-ownership statement with the county recorder or assessor in each county in which the decedent owned real property at the time of death that is subject to probate proceedings. The statement must be filed prior to or at the time the inventory and appraisal are filed with the court clerk. (R&TC Section 480.)

FISCAL EFFECT: The BOE estimates that a previous, but similar, version of this bill would cause a projected annual property tax revenue loss of $24 million. Committee staff notes that this bill, as currently drafted, almost certainly exceeds this Committee's Suspense File threshold.

COMMENTS:

1. The author has submitted the following statement in support of this bill:

SB 288 will provide protections for individuals who are not able to take ownership of a home because of a probate process. By adding clarity to Prop 19 this measure ensures that families preserve a valuable asset and are not unduly burdened by a tax reassessment because of a legal process with timelines outside their direct control.

1. The California Assessors' Association, writing in support of this bill, states, in part:

SB 288 would allow the one-year period to begin after the effective date of a probate court order resolving the matter, provided the transferee has submitted the eligibility form, obtained the probate order demonstrating the prohibition on occupancy, and filed the death statement. These amendments ensure that transferees facing legal restrictions receive the same amount of time to establish residency as other applicants.

1. Committee Staff Comments:
   1. ACA 11/Proposition (Prop.) 19: In 2020, the Legislature enacted ACA 11, which voters subsequently approved in November of that year as Prop. 19. Prop. 19 dramatically restructured a number of provisions related to the retention of base year values for properties with certain eligible owners. Prior to Prop. 19, intergenerational base year value transfers were far more generous, allowing the base year value of a decedent's property to transfer to their qualifying child or grandchild regardless of the property's fair market value if the property was used as the principal place of residence for both the transferor and transferee. Additionally, $1 million of the aggregate full cash value of all other real property could be excluded from assessment resulting from a change in ownership. Prop. 19 restricted this exclusion, such that only $1 million above the principal residence's taxable value just prior to transfer is excluded. Any increase in the amount of taxable value above $1 million is added to the adjusted base year value of the property, and the resulting sum becomes the property's new base year value. Prop. 19 also required that a qualifying transferee must claim the homeowners' or disabled veterans' exemptions within one year of the transfer to qualify for the intergenerational transfer exclusion.
2. Disposition of a decedent's estate: Generally, a deceased person's assets are distributed through a will or by intestate succession. Usually, assets are subject to probate administration, though there are various mechanisms that allow for the transfer of property without undergoing the formal process. These include trusts and small estates, among others. If, however, assets are required to be processed through standard probate proceedings, it may take years to fully adjudicate the ownership of the assets. Thus, it may be that in the case of a property subject to probate administration, an otherwise eligible transferee cannot occupy the transferred property within the one-year period prescribed under existing law to qualify for the intergenerational transfer exclusion even if that transferee intended to occupy the property as their principal place of residence within one year of the transfer.
3. This bill: As currently drafted, this bill would delay the counting of the one-year period for an eligible transferee to occupy a transferred property as a primary residence if certain documentation is filed with the assessor. Specifically, an eligible transferee must file the claim for eligibility form with the BOE required under existing law, a copy of the court order indicating that a probate matter prohibited the eligible transferee from establishing the property as their principal place of residence within the one-year period, and a change-in-ownership statement required under existing law.
4. Related legislation: SB 284 (Seyarto) would have delayed the counting of the one-year period to occupy and claim certain exemptions to qualify for the intergenerational transfer exclusion if the transferred property was subject to a judicial decree issued pursuant to a specific section of the Probate Code. SB 284 was held on this Committee's Suspense File.
5. Prior legislation: SB 539 (Hertzberg), Chapter 427, Statutes of 2021, was enacted to implement the provisions of Prop. 19 and clarified certain administrative uncertainties. Included in these provisions was the requirement that the eligible transferee claim the homeowners' or disabled veterans' exemption and occupy the property as their principal place of residence within one year of the transfer.

REGISTERED SUPPORT / OPPOSITION:

Support

California Assessors' Association

California Board of Equalization

Howard Jarvis Taxpayers Association

Southwest California Legislative Council

Opposition

None on file

Analysis Prepared by: Harrison Bowlby / REV. & TAX. / (916) 319-2098

Date of Hearing: June 8, 2026

ASSEMBLY COMMITTEE ON REVENUE AND TAXATION

Mike Gipson, Chair

SBPCA Bill Id:SB 288

Author:(Seyarto) – As Amended Ver:June 1, 2026

Majority vote. Tax levy. Fiscal committee.

SENATE VOTE: 40-0

SUBJECT: Property taxation: change in ownership: family homes and farms

SUMMARY: Clarifies the treatment of property subject to a court order entered pursuant to the Probate Code when transferring certain properties intergenerationally. Specifically, this bill:

1. Provides that the one-year period for an eligible transferee to occupy a property as their principal residence, and file the homeowners' or disabled veterans' exemption, is deemed to end one year after the effective date of a court order entered pursuant to the Probate Code resolving disposition of the property if the eligible transferee files with the assessor all of the following:
   1. An eligibility claim for the "intergenerational transfer exclusion" required under existing law;
   2. A copy of a court order indicating that a probate matter prohibited the eligible transferee from establishing the property as their principal place of residence within the one-year period described under existing law; and,
   3. A change-in-ownership statement required under existing law.
2. Corrects erroneous cross-references under existing law.
3. Requires reimbursement of local agencies and school districts for costs mandated by this bill, if the Commission on State Mandates determines that this bill contains costs mandated by the state.
4. Prohibits the state from reimbursing any local agency for any property tax revenues lost because of this bill.
5. Takes immediate effect as a tax levy.

EXISTING LAW:

1. Provides that all property is taxable unless otherwise stipulated by the California Constitution or the laws of the United States. (California Constitution, Article XIII, Section 1.)
2. Limits the maximum amount of ad valorem property taxation to 1% of the full cash value of the property. Generally, the Constitution restricts the full cash value of a property to the assessed value upon a change of ownership in, or new construction on, the property. This value is referred to as the base year value, which may be adjusted upwards for inflation at no more than 2% annually. (California Constitution, Article XIIIA, Sections 1 and 2.)
3. Excludes from the definition of change in ownership the purchase or transfer of a family home or family farm to a decedent's eligible child or grandchild. The exclusion is limited to $1 million of the increase in assessed value upon the purchase or transfer over the property's adjusted base year value; any additional assessed value is subject to taxation pursuant to existing law. To qualify, a decedent's child or grandchild, also termed a transferee, must occupy the property as their principal place of residence and claim the homeowner's or disabled veteran's exemption within one year of the transfer. Additionally, the transferee must file with the State Board of Equalization (BOE) claiming eligibility for the exclusion, generally within three years after the date of the purchase or transfer of the eligible real property, as conditioned. This exclusion applies to both voluntary transfers and transfers resulting from a court order or judicial decree, and is often referred to as the "intergenerational transfer exclusion." (California Constitution, Article XIIIA, Section 2.1. and Revenue and Taxation Code (R&TC) Section 63.2.)
4. Requires that, among other provisions, the personal representative of a decedent file a change-in-ownership statement with the county recorder or assessor in each county in which the decedent owned real property at the time of death that is subject to probate proceedings. The statement must be filed prior to or at the time the inventory and appraisal are filed with the court clerk. (R&TC Section 480.)

FISCAL EFFECT: The BOE estimates that a previous, but similar, version of this bill would cause a projected annual property tax revenue loss of $24 million. Committee staff notes that this bill, as currently drafted, almost certainly exceeds this Committee's Suspense File threshold.

COMMENTS:

1. The author has submitted the following statement in support of this bill:

SB 288 will provide protections for individuals who are not able to take ownership of a home because of a probate process. By adding clarity to Prop 19 this measure ensures that families preserve a valuable asset and are not unduly burdened by a tax reassessment because of a legal process with timelines outside their direct control.

1. The California Assessors' Association, writing in support of this bill, states, in part:

SB 288 would allow the one-year period to begin after the effective date of a probate court order resolving the matter, provided the transferee has submitted the eligibility form, obtained the probate order demonstrating the prohibition on occupancy, and filed the death statement. These amendments ensure that transferees facing legal restrictions receive the same amount of time to establish residency as other applicants.

1. Committee Staff Comments:
   1. ACA 11/Proposition (Prop.) 19: In 2020, the Legislature enacted ACA 11, which voters subsequently approved in November of that year as Prop. 19. Prop. 19 dramatically restructured a number of provisions related to the retention of base year values for properties with certain eligible owners. Prior to Prop. 19, intergenerational base year value transfers were far more generous, allowing the base year value of a decedent's property to transfer to their qualifying child or grandchild regardless of the property's fair market value if the property was used as the principal place of residence for both the transferor and transferee. Additionally, $1 million of the aggregate full cash value of all other real property could be excluded from assessment resulting from a change in ownership. Prop. 19 restricted this exclusion, such that only $1 million above the principal residence's taxable value just prior to transfer is excluded. Any increase in the amount of taxable value above $1 million is added to the adjusted base year value of the property, and the resulting sum becomes the property's new base year value. Prop. 19 also required that a qualifying transferee must claim the homeowners' or disabled veterans' exemptions within one year of the transfer to qualify for the intergenerational transfer exclusion.
2. Disposition of a decedent's estate: Generally, a deceased person's assets are distributed through a will or by intestate succession. Usually, assets are subject to probate administration, though there are various mechanisms that allow for the transfer of property without undergoing the formal process. These include trusts and small estates, among others. If, however, assets are required to be processed through standard probate proceedings, it may take years to fully adjudicate the ownership of the assets. Thus, it may be that in the case of a property subject to probate administration, an otherwise eligible transferee cannot occupy the transferred property within the one-year period prescribed under existing law to qualify for the intergenerational transfer exclusion even if that transferee intended to occupy the property as their principal place of residence within one year of the transfer.
3. This bill: As currently drafted, this bill would delay the counting of the one-year period for an eligible transferee to occupy a transferred property as a primary residence if certain documentation is filed with the assessor. Specifically, an eligible transferee must file the claim for eligibility form with the BOE required under existing law, a copy of the court order indicating that a probate matter prohibited the eligible transferee from establishing the property as their principal place of residence within the one-year period, and a change-in-ownership statement required under existing law.
4. Related legislation: SB 284 (Seyarto) would have delayed the counting of the one-year period to occupy and claim certain exemptions to qualify for the intergenerational transfer exclusion if the transferred property was subject to a judicial decree issued pursuant to a specific section of the Probate Code. SB 284 was held on this Committee's Suspense File.
5. Prior legislation: SB 539 (Hertzberg), Chapter 427, Statutes of 2021, was enacted to implement the provisions of Prop. 19 and clarified certain administrative uncertainties. Included in these provisions was the requirement that the eligible transferee claim the homeowners' or disabled veterans' exemption and occupy the property as their principal place of residence within one year of the transfer.

REGISTERED SUPPORT / OPPOSITION:

Support

California Assessors' Association

California Board of Equalization

Howard Jarvis Taxpayers Association

Southwest California Legislative Council

Opposition

None on file

Analysis Prepared by: Harrison Bowlby / REV. & TAX. / (916) 319-2098

 THIRD READING  

Bill No: SB 288

Author: Seyarto (R)

Amended: 1/22/26

Vote: 21

SENATE REVENUE AND TAXATION COMMITTEE: 5-0, 1/14/26

AYES: McNerney, Valladares, Ashby, Grayson, Umberg

SENATE APPROPRIATIONS COMMITTEE: 7-0, 1/22/26

AYES: Caballero, Seyarto, Cabaldon, Dahle, Grayson, Richardson, Wahab

SUBJECT: Property taxation: change in ownership: family homes and farms

SOURCE: Author

DIGEST:

This bill specifies that the one-year period to claim an intergenerational transfer change in ownership exclusion is deemed to commence on the effective date of a probate court’s determination of the final ownership of property.

ANALYSIS:

Existing law:

1. Provides that all property is taxable unless explicitly exempted by the Constitution or federal law (California Constitution, Article XIII, Section One).
2. Limits the maximum amount of any ad valorem tax on real property at 1% of full cash value, plus any locally-authorized bonded indebtedness, and caps a property’s annual inflationary increase in taxable value to 2%. Provides that assessors reappraise property whenever it is purchased, newly constructed, or when ownership changes (California Constitution, Article XIIIA, as added by Proposition 13, 1978).
3. Defines a change in ownership as a transfer of a present interest in real property, including the beneficial use thereof, the value of which is substantially equal to the value of the fee interest.
4. Provides that a change in ownership results in the establishment of a new base year value for the portion of a property that has undergone such change in ownership, unless an exclusion applies.
5. Considers a decedent’s real property and manufactured homes to have changed ownership as of the date of death, and the property is subject to reassessment as of that date unless an exclusion applies, regardless of whether the decedent’s property is inherited through a trust, a will, intestate succession, revocable transfer on death deed, or is subject to probate administration; the date of death applies for property tax purposes even if the beneficiary is officially recorded as the new owner of the property at a later date.
6. Enacts change in ownership exclusions for transfers of property transfers from one generation to the next, specifically:
   1. Transfers of property from parents to children from change in ownership (Proposition 58, 1986).
   2. Transfers of property to grandchildren, so long as the parents are deceased (Proposition 193, 1996).
7. Enacts the Home Protection for Seniors, Severely Disabled, Families, and Victims of Wildfire or Natural Disasters Act, which limits the above exclusions solely to the transfer of a principal residence when the property continues as the primary residence of the transferee, and requires the transferee to claim the homeowner’s exemption from property tax at the time of transfer or within one year to apply the exclusion, among other limitations (Proposition 19, 2020).
8. Codifies Proposition 19’s requirement that the transferee claim the homeowners’ or disabled veterans’ exemption at the time of transfer to apply the exclusion, reinforces its requirement for the transferee to file for the homeowners’ or disabled veterans’ exemption within one year of transfer, and directs the assessor to remove the exclusion as of the date the property is no longer the principal residence of the transferee (SB 539, Hertzberg, Chapter 427, Statutes of 2021).

This bill:

1. Specifies that the one-year period to claim an intergeneration transfer change in ownership exclusion is deemed to commence on the effective date of a probate court’s determination of the final ownership of property, not the date of death.
2. Applies notwithstanding any other law in the event of a transfer to an eligible transferee as a result of the death of an eligible transferor by an order entered pursuant to the Probate Code.
3. Makes a punctuation change.

Background

A probate process generally takes 9 to 18 months from beginning to end, and can sometimes take even longer. While beneficiaries can occupy a property under certain circumstances, they cannot take ownership until the probate court issues its order. As a result, many beneficiaries cannot claim the homeowners’ exemption within one year, so therefore cannot claim a Proposition 19 intergenerational change in ownership exclusion. SB 288 would commence the one-year period on the date the court determines final ownership of the property, notwithstanding any other law, thereby allowing those inheriting property from parents or grandparents in probate to claim an exclusion.

Related/Prior Legislation

Last year, the Senate approved SB 284 (Seyarto), which made two changes: First, it would have provided a second change in ownership exclusion between eligible transferees within one year of the date of the initial transfer under Proposition 19. Second, it would have provided that the one-year period for an eligible transferee to file for a homeowner’s or disabled veteran’s exemption for purposes of claiming a Prop. 19 intergenerational transfer exclusion commences on the date of the probate court’s final order for purposes of claiming the intergenerational transfer exclusion. While this bill does not propose a similar second change in ownership exclusion, it is substantially similar to SB 284’s second part. SB 284 was held on the Assembly Revenue & Taxation Committee’s Suspense File.

Additionally, the Legislature enacted SB 293 (Perez, Chapter 539, Statutes of 2025), which extends the current deadline for taxpayers to retroactively apply a Proposition 58, 193, or 19 intergenerational transfer from six months to three years under specified circumstances resulting from the 2025 Los Angeles Fires.

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

According to the Senate Appropriations Committee:

• The Board of Equalization (BOE) estimates that this bill would result in annual property tax revenue losses of $24 million. Reductions in local property tax revenues, in turn, can increase General Fund Proposition 98 spending by up to roughly 50 percent (the exact amount depends on the specific amount of the annual Proposition 98 guarantee, which in turn depends upon a variety of economic, demographic and budgetary factors). BOE would incur General Fund costs of $143,000 in 2026-27, $105,000 in 2027-28, $87,000 in 2028-29, and $72,000 annually thereafter, to implement the provisions of the bill.
• By changing the duties of local tax officials, this bill creates a state-mandated local program. To the extent the Commission on State Mandates determines that the provisions of this bill create a new program or impose a higher level of service on local agencies, local agencies could claim reimbursement of those costs. The magnitude is unknown (General Fund).

SUPPORT: (Verified 1/26/26)

Howard Jarvis Taxpayers Association

OPPOSITION: (Verified 1/26/26)

None received

ARGUMENTS IN SUPPORT: According to the author, “SB 288 will provide protections for individuals who are not able to take ownership of a home because of a probate process. By adding clarity to Prop 19 this measure ensures that families preserve a valuable asset and are not unduly burdened by a tax reassessment because of a legal process with timelines outside their direct control.”

Prepared by: Colin Grinnell / REV. & TAX. / (916) 651-4117

1/26/26 13:21:59

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SENATE COMMITTEE ON

Senator Anna Caballero, Chair

2025 - 2026 Regular Session

SB 288 (Seyarto) - Property taxation: change in ownership: family homes and farms

Bill Summary:

SB 288 would, for purposes of Proposition 19’s intergenerational transfer change in ownership exclusion, deem the date of transfer to occur as of the effective date of a court’s determination regarding the final ownership of inherited property, rather than the date of death.

*********** ANALYSIS ADDENDUM – SUSPENSE FILE ***********

The following information is revised to reflect amendments

adopted by the committee on January 22, 2026

Fiscal Impact:

• The Board of Equalization (BOE) estimates that this bill would result in annual property tax revenue losses of $24 million. Reductions in local property tax revenues, in turn, can increase General Fund Proposition 98 spending by up to roughly 50 percent (the exact amount depends on the specific amount of the annual Proposition 98 guarantee, which in turn depends upon a variety of economic, demographic and budgetary factors). BOE would incur General Fund costs of $143,000 in 2026-27, $105,000 in 2027-28, $87,000 in 2028-29, and $72,000 annually thereafter, to implement the provisions of the bill.

Author Amendments:

Delete provisions 63.2(a)(1)(D)(i) and 63.2(a)(1)(D)(ii) from the bill.

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SENATE COMMITTEE ON

Senator Anna Caballero, Chair

2025 - 2026 Regular Session

SB 288 (Seyarto) - Property taxation: change in ownership: family homes and farms

Bill Summary:

SB 288 would, for purposes of Proposition 19’s intergenerational transfer change in ownership exclusion, deem the date of transfer to occur as of the effective date of a court’s determination regarding the final ownership of inherited property, rather than the date of death.

Fiscal Impact:

• The Board of Equalization (BOE) estimates that this bill would result in annual property tax revenue losses of $24 million. Reductions in local property tax revenues, in turn, can increase General Fund Proposition 98 spending by up to roughly 50 percent (the exact amount depends on the specific amount of the annual Proposition 98 guarantee, which in turn depends upon a variety of economic, demographic and budgetary factors). BOE would incur General Fund costs of $143,000 in 2026-27, $105,000 in 2027-28, $87,000 in 2028-29, and $72,000 annually thereafter, to implement the provisions of the bill.
• By changing the duties of local tax officials, this bill creates a state-mandated local program. To the extent the Commission on State Mandates determines that the provisions of this bill create a new program or impose a higher level of service on local agencies, local agencies could claim reimbursement of those costs. The magnitude is unknown (General Fund).

Background:

Under the California Constitution, all property is taxable unless explicitly exempted by itself or federal law. The Constitution limits the maximum amount of any ad valorem tax on real property at one percent of full cash value, plus any locally-authorized bonded indebtedness (Proposition 13, 1978). Assessors reappraise property whenever it is purchased, newly constructed, or when ownership changes (as defined by both statute and the Constitution). Current law generally sets a property’s value as its sales price when purchased or, when there is no sales price, at its fair market value when ownership changes (base year value). Thereafter, existing law requires an annual inflation adjustment to that value that cannot exceed 2 percent (factored base year value).

As part of Proposition 13’s implementation, the Legislature defined “change in ownership” as “a transfer of a present interest in real property, including the beneficial use thereof, the value of which is substantially equal to the value of the fee interest.” Two change in ownership exclusions for property transfers from one generation to the next were subsequently enacted: (1) Proposition 58 (1986) excluded transfers of property from parents to children from change in ownership, and (2) Proposition 193 extended the exclusion to transfers of property to grandchildren, if the parents are deceased. These exclusions applied to (1) all inherited primary residences, regardless of value or number of transfers, and (2) up to $1 million in aggregate value of all other types of property, such as second homes or business properties.

As of February 15, 2021, Proposition 19 (2020) among other things limits the parent-child and grandparent-grandchild exclusion enacted by Propositions 58 and 193 to apply solely to the transfer of a principal residence when the property continues as the primary residence of the transferee. Proposition 19 further repeals the parent-child, grandparent-grandchild exclusion for up to $1 million in aggregate value of all other types of property that is not the principal residence entirely. Among other requirements, transferees are required to claim the homeowners’ or disabled veteran’s exemption at the time of transfer to apply the exclusion. Finally, Proposition 19 caps the amount of value that can be excluded to $1 million, or $10,000 in tax at the basic 1 percent rate, even if the transfer meets all other requirements.

The Legislature subsequently enacted an omnibus Proposition 19 implementation bill (SB 539, Hertzberg) to resolve several administrative uncertainties, largely based on similar law implementing Propositions 58 and 193. Among other requirements, SB 539 codified Proposition 19’s requirement that the transferee claim the homeowners’ or disabled veteran’s exemption at the time of transfer to apply the exclusion. SB 539 additionally reinforced the requirement for the transferee to file for the homeowners’ or disabled veterans’ exemption within one year of transfer and remove the exclusion as of the date the property is no longer the principal residence of the transferee.

Upon death, a person’s assets are generally distributed through a will or by intestate succession, and are usually subject to probate administration. There are various other ways to transfer property outside of formal probate administration, such as trusts, payable on death accounts, revocable transfer on death deeds, joint tenancy with right of survivorship, community property with right of survivorship, and small estates.

For property tax purposes, current law generally considers a decedent’s real property and manufactured homes to have changed ownership as of the date of death, and the property is subject to reassessment as of that date unless an exclusion applies. This treatment applies regardless of whether the decedent’s property is inherited through a trust, a will, intestate succession, revocable transfer on death deed, or is subject to probate administration. The date of death applies for reassessment purposes even if the beneficiary is officially recorded as the new owner of the property at a later date. For trusts, state law specifically provides that a change in ownership occurs when any interests in real property vest in persons other than the trustor or the trustor’s spouse or registered domestic partner when a revocable trust becomes irrevocable, which is generally the trustor’s date of death.

The entire probate process generally lasts from 9 to 18 months, but can sometimes take even longer. While beneficiaries can occupy a property under certain circumstances, they cannot take ownership until the Court issues its order. Consequently, many beneficiaries cannot claim the homeowners’ exemption within one year, so therefore cannot claim a Proposition 19 intergenerational change in ownership exclusion even though they otherwise would be eligible.

Proposed Law:

This bill among other things would deem the date of transfer to occur as of the effective date of a probate court’s determination of the final ownership of property, not the date of death, for purposes of Proposition 19. It would apply in the event of the death of the transferor, and notwithstanding any other law.

Prior Legislation: SB 284 (Seyarto), similar to this bill, made two changes: First, it would have provided a second change in ownership exclusion between eligible transferees within one year of the date of the initial transfer under Proposition 19. Second, it would have provided that the one-year period for an eligible transferee to file for a homeowner’s or disabled veteran’s exemption for purposes of claiming a Proposition 19 intergenerational transfer exclusion commences on the date of the probate court’s final order for purposes of claiming the intergenerational transfer exclusion. While this bill does not propose a similar second change in ownership exclusion, it is substantially similar to SB 284’s second part. However, this bill would apply more broadly by applying to any case in which a court determines final property ownership after the death of the transferee, not just for final judicial decrees under the Probate Code. The bill was held under submission on the Suspense File of the Assembly Revenue & Taxation Committee.

Staff Comments: BOE’s revenue estimate assumes that every transfer taking place as a result of this bill would result in a revenue loss of $3,117, based on the differential between state median real estate prices and the 2025 average assessed value. The number of transfers occurring annually is expected to be below 10,000.

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SENATE COMMITTEE ON REVENUE AND TAXATION

Senator Jerry McNerney, Chair

2025 - 2026 Regular

Property taxation: change in ownership: family homes and farms

Deems the date of transfer to occur as of the effective date of a court’s determination regarding the final ownership of inherited property, rather than the date of death, for purposes of Proposition 19’s intergenerational transfer change in ownership exclusion.

Background

Section One of Article XIII of the California Constitution provides that all property is taxable unless explicitly exempted by the Constitution or federal law. The Constitution limits the maximum amount of any ad valorem tax on real property at 1% of full cash value, plus any locally authorized bonded indebtedness, and caps a property’s annual inflationary increase in taxable value to 2% (Article XIIIA, as added by Proposition 13 of 1978). Assessors reappraise property whenever it is purchased, newly constructed, or when there is a change in ownership. The Constitution and statute define those terms.

Change in ownership. State law defines a change in ownership as a transfer of a present interest in real property, including the beneficial use thereof, the value of which is substantially equal to the value of the fee interest. A change in ownership results in the establishment of a new base year value for the portion of a property that has undergone such change in ownership, unless an exclusion applies.

Change in ownership exclusions. Since voters approved Proposition 13, either voters or the Legislature (or both together) have enacted changes in ownership exclusions for certain transfers. Among these, the Legislature enacted, and voters approved, two changes in ownership exclusions for transfers of property from one generation to the next, known as “intergenerational transfers.” Proposition 58 (1986) excluded transfers of property from parents to children from change in ownership (ACA 2, Hannigan). Ten years later, Proposition 193 extended the exclusion to transfers of property to grandchildren, provided the parents are deceased (ACA 17, Knowles). These two changes created an exclusion to the requirement that property be reassessed when a change in ownership occurs and apply when property is passed down (parent to child; grandparent to grandchild) or passed up (child to parent). These exclusions applied to all inherited primary residences, regardless of value or number of transfers, and to up to $1 million in aggregate value of all other types of property, such as second homes or business properties.

ACA 11/Proposition 19. In 2020, the Legislature enacted, and voters approved as Proposition 19, the Home Protection for Seniors, Severely Disabled, Families, and Victims of Wildfire or Natural Disasters Act (ACA 11, Mullin). Among other provisions, the Act added a new section to the California Constitution to limit the parent-child and grandparent-grandchild exclusion enacted by Propositions 58 and 193. Specifically, the exclusion now applies only to the transfer of a principal residence when the property continues as the primary residence of the transferee. The transferee has one year from the date of transfer to reside in the home to be eligible for the exclusion. Additionally, the Act repealed the parent-child, grandparent-grandchild exclusion for up to $1 million in aggregate value of all other types of property that is not the principal residence entirely. Among other requirements for the exclusion to apply, the Act requires the principal residence of the transferor to become the principal residence of the transferee, and for the transferee to claim the homeowners’ or disabled veteran’s exemption at the time of transfer. Lastly, Proposition 19 caps the amount of value that can be excluded to $1 million, or $10,000 in tax at the 1% rate, even if the transfer meets all other requirements. These changes became effective February 15, 2021.

After the enactment of Proposition 19, the Legislature enacted an omnibus bill to resolve several administrative uncertainties, largely based on similar law implementing Propositions 58 and 193 (SB 539, Hertzberg). Among other requirements, SB 539 codified Proposition 19’s requirement that the transferee claim the homeowners’ or disabled veteran’s exemption at the time of transfer to apply the exclusion. Additionally, SB 539 reinforced the requirement for the transferee to file for the homeowners’ or disabled veterans’ exemption within one year of transfer and remove the exclusion as of the date the property is no longer the principal residence of the transferee.

Death of property owner. When a person dies, their assets are generally distributed through a will or by intestate succession and are usually subject to probate administration. There are various other ways to transfer property outside of formal probate administration, such as trusts, payable on death accounts, revocable transfer on death deeds, joint tenancy with right of survivorship, community property with right of survivorship, and small estates.

For property tax purposes, the law generally considers a decedent’s real property and manufactured homes to have changed ownership as of the date of death, and the property is subject to reassessment as of that date unless an exclusion applies. This treatment applies regardless of whether the decedent’s property is inherited through a trust, a will, intestate succession, revocable transfer on death deed, or is subject to probate administration. The date of death applies for reassessment purposes even if the beneficiary is officially recorded as the new owner of the property at a later date. For trusts, state law specifically provides that a change in ownership occurs when any interests in real property vest in persons other than the trustor or the trustor’s spouse or registered domestic partner when a revocable trust becomes irrevocable, which is generally the trustor’s date of death.

Resolving a decedent’s estate can take time. For example, the entire Probate process generally takes 9 to 18 months and can sometimes take even longer. While beneficiaries can occupy a property under certain circumstances, they generally cannot occupy or own the property until a Court issues its order. As a result, many beneficiaries cannot claim the homeowners’ exemption within one year, so therefore cannot claim a Proposition 19 intergenerational change in ownership exclusion even when they’re otherwise eligible.

The author wants to ensure that eligible transferees who want to claim an intergenerational transfer are not prevented from doing so because ownership of the property has not been granted by a court within one year of the transferor’s death.

Proposed Law

Senate Bill 288 deems the date of transfer to occur as of the effective date of a probate court’s determination of the final ownership of property, not the date of death, for purposes of Proposition 19. SB 288 applies in the event of the death of the transferor, and notwithstanding any other law. The measure clarifies that it shall not be construed to alter the duration for corrections of property tax assessments under current law. Transferees must notify the assessor within one year of the death of the transferor of their intent to claim a transfer, on a form designed by Board of Equalization.

State Revenue Impact

Pending.

Comments

1. Purpose of the bill. According to the author, “SB 288 will provide protections for individuals who are not able to take ownership of a home because of a probate process. By adding clarity to Prop 19 this measure ensures that families preserve a valuable asset and are not unduly burdened by a tax reassessment because of a legal process with timelines outside their direct control.”

2. Timing is everything. Proposition 19 inserted stringent new requirements for intergenerational transfers into the Constitution without authorizing the Legislature to modify them. These requirements significantly limited the ability of individuals who inherit property from transferring its base year value compared to Propositions 58 and 193, resulting in inheritors either maintaining ownership of the property and paying higher property taxes or selling it if they do not reside there. Specifically, inheriting transferees must reside in the family home within one year of the transferor’s date of death to claim a transfer. However, when a property is subject to Probate proceedings, transferees may be legally barred from complying with this requirement until the court determines its ownership. SB 288 seeks to resolve this problem by specifying that, in the case of a transferor’s death, the date of transfer is not the date of death that is the default for property tax purposes, but instead the date of the probate court’s order. While the measure departs from this default rule, it may be the only way to allow transferees who want to comply with Proposition 19 to claim the transfer.

3. Do it again. Last year, the Senate approved SB 284 (Seyarto), which made two changes: First, it would have provided a second change in ownership exclusion between eligible transferees within one year of the date of the initial transfer under Proposition 19. Second, it would have provided that the one-year period for an eligible transferee to file for a homeowner’s or disabled veteran’s exemption for purposes of claiming a Prop. 19 intergenerational transfer exclusion commences on the date of the probate court’s final order for purposes of claiming the intergenerational transfer exclusion. While this bill does not propose a similar second change in ownership exclusion, it is substantially similar to SB 284’s second part. However, SB 288 applies more broadly by applying to any case in which a court determines final property ownership after the death of the transferee, not just for final judicial decrees under the Probate Code. The Assembly Revenue & Taxation Committee held SB 284 on its suspense file.

4. Related legislation. Last year, the Legislature enacted SB 293 (Perez), which extends the current deadline for taxpayers to retroactively apply a Proposition 58, 193, or 19 intergenerational transfer from six months to three years under specified circumstances resulting from the 2025 Los Angeles Fires.

5. Mandate. The California Constitution requires the state to reimburse local governments for the costs of new or expanded state-mandated local programs. Because SB 288 changes how assessors value real property, Legislative Counsel says that this bill imposes a new state mandate. The measure provides that the state shall not reimburse local agencies for property tax revenue losses, instead stating that, should the Commission on State Mandates determine that the bill imposes a reimbursable mandate, reimbursement must be made pursuant to existing statutory provisions.

6. Technical. Currently, SB 288 sets a different date of transfer in the case of a transferor’s death; however, it’s likely better to instead specify that Prop. 19’s one year period is measured from a different date rather than setting a different date of transfer that would otherwise apply. Additionally, because SB 288 applies notwithstanding any other law, it may (1) refer to a non-existent date when a transferor dies but a court proceeding does not ensue, and (2) apply to proceedings outside the Probate Code. The Committee may wish to consider replacing the bill’s current addition of R&T §63.2(a)(1)(D) to instead read:

“Notwithstanding any other law, in the event of the transfer as a result of an eligible transferor by an order entered pursuant to the Probate Code, the one-year period described in subparagraph (A) or (B) shall be deemed to commence as of the effective date of the order entered into pursuant to the Probate Code.”

Support and Opposition

(1/8/26)

Support: Howard Jarvis Taxpayers Association.

Opposition: None received.

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