SB288 - Property taxation: change in ownership: family homes and farms.

Amended IN Assembly June 01, 2026 Amended IN Senate January 22, 2026 Amended IN Senate January 15, 2026 Amended IN Senate January 05, 2026 CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION Senate Bill No. 288 Introduced by Senator Seyarto February 06, 2025 An act to amend Section 63.2 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy. LEGISLATIVE COUNSEL'S DIGEST SB 288, as amended, Seyarto. Property taxation: change in ownership: family homes and farms. 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 assessor’s valuation of real property as shown on the 1975–76 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. 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. Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO YES Bill Text The people of the State of California do enact as follows: SECTION 1. Section 63.2 of the Revenue and Taxation Code, as amended by Section 2 of Chapter 539 of the Statutes of 2025, is amended to read: 63.2. (a) Notwithstanding any provision of this chapter, beginning on and after February 16, 2021, a change in ownership shall not include, in whole or in part, any of the following purchases or transfers for which a claim is filed: (1) The purchase or transfer of real property that is the principal residence of an eligible transferor in the case of a purchase or transfer between parents and their children or between grandparents and their grandchildren, if all of the parents, other than stepparents, of that grandchild or those grandchildren, who qualify as the children of the grandparents, are deceased as of the date of purchase or transfer. (A) The transfer is required to be of a principal residence of the transferor, and become the principal residence of the transferee within one year of the transfer. (B) The transferee shall file for the homeowners’ or disabled veterans’ exemption within a year of the transfer, and the exclusion shall be removed on the date an eligible transferee, or a subsequent eligible transferee who files for the homeowners’ or disabled veterans’ exemption within one year, is no longer eligible for either the homeowners’ or disabled veterans’ exemption. (C) If applicable, as of the lien date immediately following the date the eligible transferee or subsequent eligible transferee no longer qualifies for the exclusion provided by this section, the base year value established as of the change in ownership date to which the exclusion applied, adjusted annually in accordance with paragraph (1) of subdivision (a) of Section 51, shall be enrolled. (D) 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, the one-year period described in subparagraph (A) or (B) shall be deemed to commence as of the effective date of the order entered pursuant to the Probate Code. (D) Notwithstanding any other law, the one-year period described in subparagraph (A) or (B) shall 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 with the assessor all of the following: (i) The eligibility form prescribed pursuant to paragraph (1) of subdivision (f). (ii) 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 prescribed by subparagraph (A). (iii) The statement described in subdivision (b) of Section 480. (2) The purchase or transfer is of a family farm of an eligible transferor in the case of a purchase or transfer between parents and their children or between grandparents and their grandchildren, if all of the parents, other than stepparents, of that grandchild or those grandchildren, who qualify as the children of the grandparents, are deceased as of the date of purchase or transfer. (A) This exclusion shall apply separately to the transfer of each legal parcel that makes up a family farm. (B) For purposes of this section, each legal parcel that makes up a family farm shall be deemed to itself be a family farm, except for a legal parcel containing a family home. (C) A legal parcel containing a family home as described in subparagraph (B) may qualify separately for exclusion under paragraph (1). (b) The exclusions provided for in this section shall not be allowed unless a claim for the exclusion sought, pursuant to subdivision (f), is filed with the assessor. (c) A claim filed under this section is not a public document and is not subject to public inspection, except that a claim shall be available for inspection by the transferee and the transferor or their respective spouse, the transferee’s legal representative, the transferor’s legal representative, the trustee of the transferee’s trust, the trustee of the transferor’s trust, and the executor or administrator of the transferee’s or transferor’s estate. (d) The new taxable value of the family home or family farm shall be the sum of both of the following: (1) The taxable value of the family home or family farm as determined in accordance with Section 110.1, with the adjustments permitted by subdivision (b) of Section 2 of Article XIII A of the California Constitution and subdivision (f) of Section 110.1, determined as of the date immediately prior to the date the principal residence or family farm is purchased or transferred to the transferee. (2) The applicable of the following amounts: (A) If the fair market value, as defined in subdivision (a) of Section 110, of the family home or family farm upon purchase by, or transfer to, the transferee is less than the sum of the taxable value described in paragraph (1) plus one million dollars ($1,000,000), then zero dollars ($0). (B) If the fair market value, as defined in subdivision (a) of Section 110, of the family home or family farm upon purchase by, or transfer to, the transferee is equal to or more than the sum of the taxable value described in paragraph (1) plus one million dollars ($1,000,000), an amount equal to the fair market value of the family home upon purchase by, or transfer to, the transferee, minus the sum of the taxable value described in paragraph (1) and one million dollars ($1,000,000). (e) As used in this section, the following terms have the following meanings: (1) “Children” means any of the following: (A) Any child born of the parent or parents, except a child, as defined in subparagraph (D), who has been adopted by another person or persons. (B) Any stepchild of the parent or parents and the spouse of that stepchild while the relationship of stepparent and stepchild exists. For purposes of this paragraph, the relationship of stepparent and stepchild shall be deemed to exist until the marriage on which the relationship is based is terminated by divorce, or, if the relationship is terminated by death, until the remarriage of the surviving stepparent. (C) Any son-in-law or daughter-in-law of the parent or parents. For the purposes of this paragraph, the relationship of parent and son-in-law or daughter-in-law shall be deemed to exist until the marriage on which the relationship is based is terminated by divorce, or, if the relationship is terminated by death, until the remarriage of the surviving son-in-law or daughter-in-law. (D) Any child adopted by the parent or parents pursuant to statute, other than an individual adopted after reaching 18 years of age. (E) Any foster child of a state-licensed foster parent, if that child was not, because of a legal barrier, adopted by the foster parent or foster parents before the child aged out of the foster care system. For purposes of this paragraph, the relationship between a foster child and foster parent shall be deemed to exist until terminated by death. However, for purposes of a transfer that occurs on the date of death, the relationship shall be deemed to exist on the date of death. (2) “Eligible transferee” means a parent, child, grandparent, or grandchild of an eligible transferor. (3) “Eligible transferor” means a grandparent, parent, grandchild, or child of an eligible transferee. (4) “Family farm” means any real property under cultivation or which is being used for pasture or grazing, or that is used to produce any agricultural commodity, as that term is defined in Section 51201 of the Government Code as that section read on January 1, 2020. (5) “Family home” or “principal place of residence” means a dwelling that is eligible for a homeowners’ exemption or a disabled veterans’ exemption as a result of the transferor’s ownership and occupation of the dwelling. “Family home” or “principal residence” includes only that portion of the land underlying the residence that consists of an area of reasonable size that is used as a site for the residence. (6) “Full cash value” means full cash value, as defined in Section 2 of Article XIII A of the California Constitution and Section 110.1, with any adjustments authorized by those sections, and the full value of any new construction in progress, determined as of the date immediately prior to the date of a purchase by or transfer to an eligible transferee of real property subject to this section. (7) “Grandchild” or “grandchildren” means any child or children of the child or children of the grandparent or grandparents. (8) “Real property” means real property as defined in Section 104. Real property does not include any interest in a legal entity. For purposes of this section, real property includes any of the following: (A) An interest in a unit or lot within a cooperative housing corporation, as defined in subdivision (i) of Section 61. (B) A pro rata ownership interest in a mobilehome park, as defined in subdivision (b) of Section 62.1. (C) A pro rata ownership in a floating home marina, as defined in subdivision (c) of Section 62.5. (9) “Transfer” includes, and is not limited to, any transfer of the present beneficial ownership of property from an eligible transferor to an eligible transferee through the medium of an inter vivos or testamentary trust. (f) (1) The State Board of Equalization shall prescribe, after consultation with the California Assessors’ Association, a form for claiming eligibility. Except as provided in paragraph (3), any claim under this section shall be filed as follows: (A) Within three years after the date of the purchase or transfer of real property for which the claim is filed, or prior to the transfer of the real property to a third party, or an eligible transferee no longer occupies the residence, whichever is earlier. (B) Notwithstanding subparagraph (A), a claim shall be deemed to be timely filed if it is filed within six months after the date of mailing of a notice of supplemental or escape assessment, issued as a result of the purchase or transfer of real property for which the claim is filed. (2) (A) Notwithstanding subparagraph (B) of paragraph (1), and subject to subparagraph (C) of this paragraph, a claim shall be deemed to be timely filed within three years after the date of mailing of a notice of supplemental or escape assessment, issued as a result of transfer of real property for which the claim is filed, when all of the following apply: (i) The assessor reassesses the property, pursuant to Section 170, as a result of that property being damaged or destroyed by the 2025 Palisades Fire, Eaton Fire, Hurst Fire, Lidia Fire, Sunset Fire, or Woodley Fire, for which the Governor proclaimed a state of emergency. (ii) The assessor issued a supplemental or escape assessment due to a previously unrecorded change in ownership on or after the date of the state of emergency described in paragraph (A). clause (i). (iii) The transferee acquires ownership of the property, including, but not limited to, pursuant to Chapter 4 (commencing with Section 13600) of Part 2 of Division 8 of the Probate Code, on or after the date of the state of emergency described in paragraph (A). clause (i). (B) If all conditions of subparagraph (A) are satisfied, and notwithstanding subpar [Text truncated for display. Full text available on Congress.gov.]