CaliforniaSpecial needs trusts count for certain family property tax transfers
Families could use a qualifying special needs trust to transfer a home or farm to certain relatives while seeking the existing property tax exclusion.
What it does
Eligible relatives could transfer a qualifying home or farm through a special needs trust and seek the existing property tax exclusion, if they meet its family, property, and filing rules.
Argument forFamilies could use a qualifying special needs trust to transfer property while seeking the existing tax exclusion, if the relative and property meet its rules.
Argument againstFamilies may find the exclusion hard to use because the trust must meet court-set disability rules, and the home transfer has strict residence and filing requirements.
More detail
A special needs trust established under Probate Code section 3604 counts as a way to transfer property between eligible relatives. The rule covers eligible parents, children, grandparents, and grandchildren transferring a qualifying family home or farm to an eligible relative through the trust. The trust must be established under Probate Code section 3604, which requires court findings about the person’s disability. The existing exclusion applies to transfers between parents and children, or grandparents and grandchildren only if all of the grandchild’s parents are deceased when the transfer occurs. For a home, it must be the transferor’s principal residence and become the transferee’s principal residence within one year; a claim must be filed. A family farm must meet the existing definition and claim rules.
Where do you stand?
Choose your position
Tell your reps
Take a position to see your representatives and ways to contact them.
Where it stands
- Introduced
- Passed Senate
- Passed Assembly
- To Governor
- Became Law
Looking ahead
No hearings or votes scheduled.
History
- 2026
- Sep 27Chaptered by Secretary of State. Chapter 665, Statutes of 2026.Latest
- Sep 27Approved by the Governor Gavin Newsom.Became Law
- Sep 2Enrolled and presented to the Governor at 3 p.m.To Governor
- Aug 27Assembly amendments concurred in. (Ayes 40. Noes 0. Page 5986.) Ordered to engrossing and enrolling.Major
- Vote recorded Special Consent. Result: pass.Upper
- Aug 26Ordered to special consent calendar.
- Aug 24In Senate. Concurrence in Assembly amendments pending.
- Vote recorded SB 974 Seyarto Senate Third Reading By Lackey. Result: pass.Lower
- Aug 24Read third time. Passed. (Ayes 76. Noes 0. Page 6371.) Ordered to the Senate.Passed Assembly
- Jul 2Read second time. Ordered to third reading.Minor
- Jul 1From committee: Do pass. (Ayes 11. Noes 0.) (July 1).Minor
- Vote recorded Do pass. Result: pass.Lower
- Jun 18Read second time and amended. Re-referred to Com. on APPR.Major
- Jun 17From committee: Do pass as amended and re-refer to Com. on APPR. (Ayes 7. Noes 0.) (June 8).Major
- Jun 8
- Vote recorded Do pass as amended and be re-referred to the Committee on [Appropriations]. Result: pass.Lower
- May 11Referred to Com. on REV. & TAX.Minor
- Apr 23In Assembly. Read first time. Held at Desk.Minor
- Vote recorded Consent Calendar 2nd. Result: pass.Upper
- Apr 23Read third time. Passed. (Ayes 37. Noes 0. Page 4034.) Ordered to the Assembly.Passed Senate
- Apr 21Read second time. Ordered to consent calendar.Minor
- Apr 20From committee: Be ordered to second reading pursuant to Senate Rule 28.8 and ordered to consent calendar.Minor
- Apr 10Set for hearing April 20.
- Apr 9Re-referred to Com. on APPR.Minor
- Apr 9Withdrawn from committee.Major
- Apr 8From committee: Do pass and re-refer to Com. on HEALTH with recommendation: To consent calendar. (Ayes 5. Noes 0. Page 3795.) (April 8). Re-referred to Com. on HEALTH.Minor
- Vote recorded Do pass, but first be re-referred to the Committee on [Health] with the recommendation: To Consent Calendar. Result: pass.Upper
- Mar 26Set for hearing April 8.
- Mar 25From committee with author's amendments. Read second time and amended. Re-referred to Com. on REV. & TAX.Major
- Feb 11Referred to Coms. on REV. & TAX. and HEALTH.Minor
- Feb 5From printer. May be acted upon on or after March 7.
- Feb 4Introduced. Read first time. To Com. on RLS. for assignment. To print.Introduced
Taxes & BudgetDisability RightsGovernment & Ethics