SB 296 California Senate · 2025-2026 Regular Session

Property taxation: exemption: disabled veteran homeowners.

Summary

The California Constitution provides that all property is taxable and requires that it be assessed at the same percentage of fair market value, unless otherwise provided by the California Constitution or federal law. The California Constitution and existing property tax law provide various exemptions from taxation, including, among others, a disabled veterans' exemption and a veterans' organization exemption. This bill would exempt from taxation, as provided, 50% of that part of the full value of the property that does not exceed $1,000,000 that is owned by, and that constitutes the principal place of residence of, a veteran, the veteran's spouse, or the veteran and the veteran's spouse jointly, if, among other things, the veteran is 100% disabled. The bill would provide an unmarried surviving spouse a property exemption in the same amount that they would have been entitled to if the veteran were alive and if certain conditions are met. In the case of a disabled veteran or unmarried surviving spouse whose household income does not exceed a specified amount for the relevant assessment year, as prescribed, the bill would exempt 100% of that part of the full value of the property that does not exceed $1,000,000 from taxation. The bill would require certain documentation to be provided to the county assessor to receive the exemption and would prohibit any other real property tax exemption from being granted to the claimant if receiving the exemption provided by the provisions of this bill. The bill would make these exemptions applicable for property tax lien dates occurring on or after January 1, 2027, but occurring before January 1, 2032. By imposing additional duties on local tax officials, the bill would impose a state-mandated local program. Existing law requires any bill authorizing a new tax expenditure to contain, among other things, specific goals, purposes, and objectives that the tax expenditure will achieve, detailed performance indicators, and data collection requirements. This bill also would include additional information required for any bill authorizing a new tax expenditure. 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.

Bill status passed both 4 of 5 stages cleared

Introduction

Feb 2025

Committee Review

Jun 2025

Senate Passage

May 2025

Assembly Passage

Aug 2026

Governor

Introduced Feb 10, 2025 Last action Aug 27, 2026

Maddy AI version diff · 6 comparisons

What changed between versions

08/25/26 - Enrolled → SB296 · 1 edit

MINOR

No substantive policy changes occurred between these two versions. The difference is purely presentational: the 'From' version is the formal enrolled bill document (with signature blocks, page numbers, and chapter number placeholder), while the 'To' version is a web-based rendering of the same bill text with navigation elements, status tracking, coauthor listings, and a digest key added. The actual legal text of SB 296 - providing property tax exemptions for disabled veteran homeowners - is identical in both versions.

TECHNICAL

The document was reformatted from a formal enrolled bill layout (with Secretary of the Senate and Chief Clerk signature blocks, page numbers, and chapter number placeholder) to a web-based bill text page with navigation menus, status timeline, coauthor information, and a digest key showing Vote: MAJORITY, Appropriation: NO, Fiscal Committee: YES, Local Program: YES.

07/03/25 - Amended Assembly → 07/01/26 - Amended Assembly · 6 edits · Jul 1, 2026

MODERATE

SB 296 was substantially revised to reduce the property tax exemption for disabled veteran homeowners from 100% of full value to a base 50%, with a 100% exemption only available to those whose household income does not exceed $83,474 (as adjusted). The bill's effective period was shortened from 10 years (2026-2036) to 5 years (2027-2032), and a new fallback provision directs higher-income veterans on lower-value properties (under $371,778 as adjusted) to the existing Section 205.5 exemption instead.

Scope change

The exemption's duration was cut from 10 years to 5 years (starting one year later and ending four years earlier), and the benefit was narrowed by introducing income and property value thresholds that limit who receives the full 100% exemption versus a reduced 50% exemption or a fallback to the existing smaller exemption.

SCOPE

The base property tax exemption for qualifying disabled veterans was reduced from 100% of full value to 50% of full value.

ELIGIBILITY

A new income-based tier was added: veterans (and unmarried surviving spouses) with household income at or below $83,474 (as adjusted for the assessment year) receive the exemption on 100% of full value rather than 50%.

A new fallback provision was added: if a veteran's property has a full value not exceeding $371,778 (as adjusted) AND their household income exceeds $83,474 (as adjusted), the property is instead eligible for the existing Section 205.5 exemption rather than the new one.

The same income threshold ($83,474) and property value cap ($371,778) tiers were extended to unmarried surviving spouses of deceased veterans, mirroring the changes made for active veterans.

TIMELINE

The effective period was shortened from January 1, 2026 through January 1, 2036 (10 years) to January 1, 2027 through January 1, 2032 (5 years).

The State Board of Equalization's first annual report deadline was pushed from June 1, 2026 to June 1, 2027, and the final report date was moved from June 1, 2035 to June 1, 2031.

03/19/25 - Amended Senate → 07/03/25 - Amended Assembly · 4 edits · Jul 3, 2025

MODERATE

The Assembly amended SB 296 to push the effective date back one year (from January 1, 2025 to January 1, 2026) and extend the sunset date by one year (to January 1, 2036). The Assembly also removed a provision that would have annually adjusted the exemption amount for inflation using the California Consumer Price Index, and restructured the eligibility criteria language in Section 205.5.1(a)(1)(B) to consolidate the disability conditions. Senator Valladares was added as a co-sponsor.

Scope change

The bill's temporal scope shifted one year later: exemptions now apply to property tax lien dates on or after January 1, 2026 (previously 2025) and sunset on January 1, 2036 (previously 2035). The removal of the inflation adjustment means the exemption's real value will erode over time rather than being maintained.

TIMELINE

The property tax exemption effective date was moved from January 1, 2025 to January 1, 2026, and the sunset/repeal date was extended from January 1, 2035 to January 1, 2036. The State Board of Equalization reporting deadline shifted accordingly from June 1, 2025 to June 1, 2026 (final report from June 1, 2034 to June 1, 2035).

FISCAL

The Assembly removed subdivision (e) of Section 205.5.1, which would have required the exemption amounts to be compounded annually by an inflation factor based on the California Consumer Price Index for all items. Without this provision, the exemption amount will remain fixed at whatever level is set in the statute.

ELIGIBILITY

The eligibility criteria in Section 205.5.1(a)(1)(B) were restructured. The old version required the veteran to be blind in both eyes OR have lost use of two or more limbs, AND have a 100 percent disability rating. The new version consolidates the language so that (B) covers blindness, limb loss with a 100 percent rating, or total disability as a result of injury or disease incurred in military service, while (C) separately addresses total disability.

SCOPE

Senator Valladares was added as a co-author alongside Senator Archuleta. Senators Padilla and Rubio were added to the list of coauthors.

Floor votes · Senate May 29, 2025 · Assembly Aug 19, 2026

How they voted

38–0

Passed · 2 other

Total votes 40

May 29, 2025

D Democratic30

28 Yea 2

93% Yea

R Republican10

10 Yea

100% Yea

Vote distribution

All Yea All Nay Mixed No data

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Aug 24, 2026

Upper · Passed

Assembly amendments concurred in. (Ayes 39. Noes 0.) Ordered to engrossing and enrolling.

upper

Aug 19, 2026

Introduced

In Senate. Concurrence in Assembly amendments pending.

upper

Aug 19, 2026

Lower · Passed

Read third time. Passed. Ordered to the Senate.

lower

Aug 13, 2026

Lower · Passed

Read second time and amended. Ordered to second reading.

lower

Aug 13, 2026

Lower · Passed

From committee: Do pass as amended. (Ayes 11. Noes 0.) (August 13).

lower

Jul 1, 2026

Lower · Passed

Read second time and amended. Re-referred to Com. on APPR.

lower

Jun 30, 2026

Lower · Passed

From committee: Do pass as amended and re-refer to Com. on APPR. (Ayes 7. Noes 0.) (June 29).

lower

Jul 3, 2025

Lower · Passed

Read second time and amended. Re-referred to Com. on REV. & TAX.

lower

Jul 2, 2025

Lower · Passed

From committee: Do pass as amended and re-refer to Com. on REV. & TAX. with recommendation: To consent calendar. (Ayes 8. Noes 0.) (July 1).

lower

Jun 9, 2025

Committee

Re-referred to Coms. on M. & V.A. and REV. & TAX. pursuant to Assembly Rule 96.

lower

Jun 5, 2025

Committee

Referred to Coms. on REV. & TAX. and M. & V.A.

lower

May 29, 2025

Upper · Passed

Read third time. Passed. (Ayes 38. Noes 0. Page 1324.) Ordered to the Assembly.

upper

May 23, 2025

Upper · Passed

From committee: Do pass. (Ayes 6. Noes 0. Page 1195.) (May 23).

upper

Apr 29, 2025

Upper · Passed

From committee: Do pass and re-refer to Com. on APPR. with recommendation: To consent calendar. (Ayes 4. Noes 0. Page 918.) (April 28). Re-referred to Com. on APPR.

upper

Mar 26, 2025

Upper · Passed

From committee: Do pass and re-refer to Com. on M. & V.A. (Ayes 5. Noes 0. Page 568.) (March 26). Re-referred to Com. on M. & V.A.

upper

Mar 19, 2025

Upper · Passed

From committee with author's amendments. Read second time and amended. Re-referred to Com. on REV. & TAX.

upper

Feb 19, 2025

Committee

Referred to Coms. on REV. & TAX. and M. & V.A.

upper

Feb 10, 2025

Introduced

Introduced. Read first time. To Com. on RLS. for assignment. To print.

upper

1 primary · 19 co-sponsors