Bill Full Text
Home
-
Bills
-
Bill
-
Authors
-
Dates
-
Locations
-
Analyses
-
Organizations
<?xml version="1.0" ?>
<ns0:MeasureDoc xmlns:html="http://www.w3.org/1999/xhtml" xmlns:ns0="http://lc.ca.gov/legalservices/schemas/caml.1#" xmlns:ns3="http://www.w3.org/1999/xlink" xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance" version="1.0" xsi:schemaLocation="http://lc.ca.gov/legalservices/schemas/caml.1# xca.1.xsd">
<ns0:Description>
<ns0:Id>20250SB__143699INT</ns0:Id>
<ns0:VersionNum>99</ns0:VersionNum>
<ns0:History>
<ns0:Action>
<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2026-03-11</ns0:ActionDate>
</ns0:Action>
</ns0:History>
<ns0:LegislativeInfo>
<ns0:SessionYear>2025</ns0:SessionYear>
<ns0:SessionNum>0</ns0:SessionNum>
<ns0:MeasureType>SB</ns0:MeasureType>
<ns0:MeasureNum>1436</ns0:MeasureNum>
<ns0:MeasureState>INT</ns0:MeasureState>
</ns0:LegislativeInfo>
<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Committee on Revenue and Taxation (Senators McNerney (Chair), Alvarado-Gil, Ashby, Becker, and Grayson)</ns0:AuthorText>
<ns0:Authors>
<ns0:Committee>
<ns0:Contribution>LEAD_AUTHOR</ns0:Contribution>
<ns0:House>SENATE</ns0:House>
<ns0:Name>Committee on Revenue and Taxation</ns0:Name>
<ns0:Members>Senators McNerney (Chair), Alvarado-Gil, Ashby, Becker, and Grayson</ns0:Members>
</ns0:Committee>
</ns0:Authors>
<ns0:Title> An act to amend Sections 6295, 17140.4, and 23711.4 of the Revenue and Taxation Code, and to amend Section 4879 of the Welfare and Institutions Code, relating to taxation. </ns0:Title>
<ns0:RelatingClause>taxation</ns0:RelatingClause>
<ns0:GeneralSubject>
<ns0:Subject>Qualified ABLE Program.</ns0:Subject>
</ns0:GeneralSubject>
<ns0:DigestText>
<html:p>
(1)
<html:span class="EnSpace"/>
Existing state sales and use tax laws impose a tax on retailers measured by the gross receipts from the sale of tangible personal property sold at retail in this state or on the storage, use, or other consumption in this state of tangible personal property purchased from a retailer for storage, use, or other consumption in this state. The Sales and Use Tax Law generally provides that the taxes are due and payable to the California Department of Tax and Fee Administration (CDTFA) quarterly on or before the last day of the month next succeeding each quarterly period and requires, for purposes of sales tax, a return to be filed by a seller that contains, among other information, the gross receipts of the seller during the preceding reporting period.
</html:p>
<html:p>The Bradley-Burns Uniform
Local Sales and Use Tax Law authorizes counties and cities to impose local sales and use taxes in conformity with the Sales and Use Tax Law, and existing laws authorize districts, as specified, to impose transactions and use taxes in accordance with the Transactions and Use Tax Law, which generally conforms to the Sales and Use Tax Law. Amendments to the Sales and Use Tax Law are automatically incorporated into the local tax laws. </html:p>
<html:p>Existing law, with respect to specified vehicles sold at retail on and after January 1, 2021, by a licensed dealer, except a new motor vehicle dealer, requires the dealer to pay the applicable sales tax, or use tax pursuant to the Transactions and Use Tax Law, to the Department of Motor Vehicles (DMV) acting for and on behalf of CDTFA within 30 days from the date of the sale. Existing law authorizes the CDTFA to exempt a licensed dealer from the requirement to pay the applicable taxes to the
DMV if specified requirements are met, and authorizes the CDTFA to revoke that exemption if it notifies the licensed dealer of the failure to satisfy those requirements, as provided. </html:p>
<html:p>This bill would authorize the CDTFA to reinstate the above-described exemption where specified requirements are met, and would require the CDTFA to notify the licensed dealer that the exemption is reinstated, as provided. The bill would also make nonsubstantive changes to the exemption provisions. </html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Existing federal law, the Stephen Beck, Jr., Achieving a Better Life Experience Act of 2014 (ABLE Act), encourages and assists individuals and families to save private funds for the purpose of supporting persons with disabilities to maintain their health, independence, and quality of life by excluding from gross income distributions used for qualified
disability expenses by a beneficiary of a qualified ABLE program established and maintained by a state, as specified.
</html:p>
<html:p>Existing law establishes the Qualified ABLE Program, administered by the California ABLE Act Board, in this state for purposes of implementing the federal ABLE Act. That law, among other things, authorizes the contributions to an ABLE account during the taxable year if specified requirements are met. </html:p>
<html:p>The Personal Income Tax Law and the Corporation Tax Law, in modified conformity with federal income tax laws, generally defines “gross income” as income from whatever source derived, except as specifically excluded, and provides various exclusions from gross income. Those laws, for taxable years beginning on or after January 1, 2016, conform to the exclusions from gross income provided under federal income tax law provisions relating to the ABLE Act, as those
exclusions read in specified federal law prior to the One Big Beautiful Bill Act. </html:p>
<html:p>This bill would also conform, for taxable years beginning on or after January 1, 2026, state tax law to those changes relating to qualified ABLE programs made by the One Big Beautiful Bill Act. The bill would also make conforming changes relating to the requirements for making contributions to an ABLE account. </html:p>
</ns0:DigestText>
<ns0:DigestKey>
<ns0:VoteRequired>MAJORITY</ns0:VoteRequired>
<ns0:Appropriation>NO</ns0:Appropriation>
<ns0:FiscalCommittee>YES</ns0:FiscalCommittee>
<ns0:LocalProgram>NO</ns0:LocalProgram>
</ns0:DigestKey>
<ns0:MeasureIndicators>
<ns0:ImmediateEffect>NO</ns0:ImmediateEffect>
<ns0:ImmediateEffectFlags>
<ns0:Urgency>NO</ns0:Urgency>
<ns0:TaxLevy>NO</ns0:TaxLevy>
<ns0:Election>NO</ns0:Election>
<ns0:UsualCurrentExpenses>NO</ns0:UsualCurrentExpenses>
<ns0:BudgetBill>NO</ns0:BudgetBill>
<ns0:Prop25TrailerBill>NO</ns0:Prop25TrailerBill>
</ns0:ImmediateEffectFlags>
</ns0:MeasureIndicators>
</ns0:Description>
<ns0:Bill id="bill">
<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
<ns0:BillSection id="id_994045E5-85A9-4959-89CD-4A4E6939DFBE">
<ns0:Num>SECTION 1.</ns0:Num>
<ns0:ActionLine action="IS_AMENDED" ns3:href="urn:caml:codes:RTC:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'DIVISION'%20and%20caml%3ANum%3D'2.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'PART'%20and%20caml%3ANum%3D'1.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'CHAPTER'%20and%20caml%3ANum%3D'3.5.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'ARTICLE'%20and%20caml%3ANum%3D'3.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'6295.'%5D)" ns3:label="fractionType: LAW_SECTION" ns3:type="locator">
Section 6295 of the
<ns0:DocName>Revenue and Taxation Code</ns0:DocName>
is amended to read:
</ns0:ActionLine>
<ns0:Fragment>
<ns0:LawSection id="id_1429A699-9786-4102-849E-E5853C43ED63">
<ns0:Num>6295.</ns0:Num>
<ns0:LawSectionVersion id="id_8474566B-60AA-4509-9345-1FFA7EC2C76E">
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
Except as provided in subdivision (h), when a motor vehicle required to be registered under the Vehicle Code, except for a recreational vehicle that is either truck-mounted, permanently towable on the highways without a permit or a park trailer, as these terms are used in Section 18010 of the Health and Safety Code, is sold at retail by a dealer holding a license issued pursuant to Chapter 4 (commencing with Section 11700) of Division 5 of the Vehicle Code, the dealer shall pay the applicable sales tax and any applicable use tax due under the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251)) to the Department of Motor Vehicles acting for and on behalf of the California Department of Tax and Fee Administration pursuant to Sections 4456 and 4750.6 of the Vehicle Code.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The amendments to this subdivision made by Section 11 of Chapter 256 of the Statutes of 2021 do not constitute a change in, but are declaratory of, existing law.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
If the dealer makes an application to the Department of Motor Vehicles that is not timely, and is subject to penalty because of delinquency in effecting registration or transfer of registration of the vehicle, the dealer shall also be liable for penalty as specified in Section 6591, but no interest shall accrue.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
Application to the Department of Motor Vehicles by the dealer shall be deemed a return filed with the California Department of Tax and Fee Administration pursuant to Article 1 (commencing with Section 6451) of Chapter 5 with respect to amounts reported to the Department of Motor Vehicles pursuant to subdivision
(a).
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
An application submitted to the Department of Motor Vehicles that is deemed a filed return pursuant to this subdivision shall be treated as filed on the date the application is submitted.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
An application submitted to the Department of Motor Vehicles that is deemed a filed return pursuant to this subdivision shall be subject to the requirements of this part.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The amendments made to this subdivision by the act adding this paragraph shall apply to sales reported to the Department of Motor Vehicles for reporting periods beginning on and after January 1, 2021.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
If the dealer fails to make an application to the Department of Motor Vehicles, fails to pay the amount of sales or use tax due, or fails to timely file a
return with the California Department of Tax and Fee Administration under Section 6452, interest and penalties shall apply with respect to the unpaid amount as provided in Chapter 5 (commencing with Section 6451).
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The amendments to this section made by the act adding this subdivision do not constitute a change in, but are declaratory of, existing law.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
For purposes of this section, the following shall apply:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
“Dealer” shall not include a franchisee as defined in Section 331.1 of the Vehicle Code, a franchisee of a recreational vehicle franchise as defined in Section 331.3, a manufacturer or remanufacturer holding a license issued pursuant to Chapter 4 (commencing with Section 11700) of Division 5 of the Vehicle Code, an automobile dismantler holding a license and certificate issued pursuant to Chapter 3
(commencing with Section 11500) of Division 5 of the Vehicle Code, or a lessor-retailer holding a license issued pursuant to Chapter 3.5 (commencing with Section 11600) of Division 5 of the Vehicle Code, and subject to the provisions of Section 11615.5 of the Vehicle Code.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
“Newly licensed dealer” means a dealer who was originally licensed by the Department of Motor Vehicles on or after January 1, 2019.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
The Department of Motor Vehicles shall, through the adoption of regulations, establish any additional requirements for the implementation of this section.
</html:p>
<html:p>
(g)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
Subject to paragraph (2), this section shall apply to sales of vehicles occurring on and after January 1, 2021.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Based upon operational needs to effectively
enforce the collection of taxes pursuant to this section, the Department of Motor Vehicles may establish the following compliance schedule for this section:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
Newly licensed dealers, dealers whose seller’s permit was reinstated within the last two years, and dealers with a previous finding of underreporting within the last two years shall comply beginning January 1, 2021.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
Except as provided in paragraph (3), all other dealers shall comply by January 1, 2023.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Based upon operational needs to effectively enforce the collection of taxes pursuant to this section, the California Department of Tax and Fee Administration, in consultation with the Department of Motor Vehicles, may delay the compliance schedule set forth in subparagraph (B) of paragraph (2) to no later than January 1, 2026, for dealers that made more
than 300 retail vehicle sales in the previous calendar year and are not subject to the compliance schedule set forth in subparagraph (A) of paragraph (2).
</html:p>
<html:p>
(h)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
The California Department of Tax and Fee Administration, in consultation with the Department of Motor Vehicles, may exempt from the requirements of subdivision (a) any dealer, including any dealer that has paid the applicable sales tax and any applicable use tax due to the Department of Motor Vehicles pursuant to subdivision (a) prior to
June 27, 2025, if the dealer sold 1,000 or more vehicles at retail in the current or preceding calendar year and the dealer’s account is in good standing with the California Department of Tax and Fee Administration.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The California Department of Tax and Fee Administration may revoke the exemption provided by this subdivision at least 30 days following the date the department provides notice to the dealer that either of the following has occurred:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
The dealer is no longer in good standing.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
The dealer’s retail vehicle sales drop below 1,000 vehicles in any calendar year
beginning on or after
June 27, 2025.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
The California Department of Tax and Fee Administration may reinstate the exemption revoked pursuant to paragraph (2) if the department determines that the dealer has sold 1,000 or more vehicles at retail in the current or preceding calendar year and the dealer’s account is in good standing with the department. The department shall notify the dealer if an exemption is reinstated, and the exemption shall be effective on the first day of a calendar quarter commencing at least 30 days following the date of the notice.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
For purposes of this subdivision, “good standing” means that the dealer has timely filed and remitted applicable payments, including applicable prepayments, for all required sales and use tax returns for the most recent 12 quarterly reporting periods.
</html:p>
</ns0:Content>
</ns0:LawSectionVersion>
</ns0:LawSection>
</ns0:Fragment>
</ns0:BillSection>
<ns0:BillSection id="id_E26793FA-8A94-4A00-B16D-D6F1A13DAA18">
<ns0:Num>SEC. 2.</ns0:Num>
<ns0:ActionLine action="IS_AMENDED" ns3:type="locator" ns3:href="urn:caml:codes:RTC:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'DIVISION'%20and%20caml%3ANum%3D'2.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'PART'%20and%20caml%3ANum%3D'10.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'CHAPTER'%20and%20caml%3ANum%3D'3.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'ARTICLE'%20and%20caml%3ANum%3D'3.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'17140.4.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 17140.4 of the
<ns0:DocName>Revenue and Taxation Code</ns0:DocName>
is amended to read:
</ns0:ActionLine>
<ns0:Fragment>
<ns0:LawSection id="id_1FDFA001-40A2-44F9-AC87-04E1325E196E">
<ns0:Num>17140.4.</ns0:Num>
<ns0:LawSectionVersion id="id_4749E175-372D-4088-B513-40218A97C2DB">
<ns0:Content>
<html:p>For taxable years beginning on or after January 1, 2016, Section 529A of the Internal Revenue Code, relating to qualified ABLE programs, added by Section 102 of Division B of Public Law 113-295, shall apply, except as otherwise provided.</html:p>
<html:p>
(a)
<html:span class="EnSpace"/>
Section 529A(a) of the Internal Revenue Code is modified as follows:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
By substituting the phrase “under this part and Part 11 (commencing with Section 23001)” in lieu of the phrase “under this subtitle.”
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
By substituting “Article 2 (commencing with Section 23731)” in lieu of “Section 511.”
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
Section 529A(c)(3)(A) of the Internal Revenue Code is
modified by substituting “2.5 percent” in lieu of “10 percent.”
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
A copy of the report required to be filed with the Secretary of the Treasury under Section 529A(d) of the Internal Revenue Code, relating to reports, shall be filed with the Franchise Tax Board at the same time and in the same manner as specified in that section.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
The amendments made by Section 303(a) of Division Q of the Consolidated Appropriations Act, 2016 (Public Law 114-113) to Section 529A(b)(1) of the Internal Revenue Code, relating to qualified ABLE programs, shall apply, except as otherwise provided.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The amendments made by Section 303(b) of Division Q of the Consolidated Appropriations Act, 2016 (Public Law 114-113) to Sections 529A(d)(3) and 529A(e) of the Internal Revenue Code, relating to qualified ABLE
programs shall apply, except as otherwise provided.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
The amendments made by Section 303(c) of Division Q of the Consolidated Appropriations Act, 2016 (Public Law 114-113) to Sections 529A(d)(4) and 529A(c)(1)(C)(i) of the Internal Revenue Code, relating to qualified ABLE program, shall apply, except as otherwise provided.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
The amendments made by Section 11024(a) of the Tax Cuts and Jobs Act (Public Law 115-97) to Section 529A(b)(2)(B) of the Internal Revenue Code, relating to qualified ABLE programs, shall apply, except as otherwise provided.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
For taxable years beginning on or after January 1, 2026, the amendments made by Section 124 of the Consolidated Appropriations Act, 2023 (Public Law 117-328) to Section 529A(e) of the Internal Revenue Code, relating to qualified ABLE programs,
shall apply, except as otherwise provided.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
(A)
<html:span class="EnSpace"/>
For the purpose of complying with Section 41, as it relates to the tax expenditures established by this subdivision and subdivision (f) of Section 23711.4 (hereafter the “tax expenditures,”) the Legislature finds and declares as follows:
</html:p>
<html:p>
(i)
<html:span class="EnSpace"/>
The goal, purpose, and objective of the tax expenditures are to encourage and assist individuals and families to save private funds for purposes of supporting persons with disabilities to maintain their health, independent, and quality of life.
</html:p>
<html:p>
(ii)
<html:span class="EnSpace"/>
The performance indicators for the Legislature to use in determining whether the tax expenditures are achieving their stated goal shall be the number of ABLE accounts that are created for individuals who are made newly eligible by the raised age limit.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
No later than January 1, 2030, the Treasurer’s office shall submit a report to the Legislature, in compliance with Section 9795 of the Government Code, detailing the number of ABLE accounts that are created for individuals who are made newly eligible by the raised age limit.
</html:p>
<html:p>
(g)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
For taxable years beginning on or after January 1, 2026, the amendments made by Section 70115(a)(1) of the One Big Beautiful Bill Act (Public Law 119-21) to Section 529A(b)(2)(B)(i) of the Internal Revenue Code, relating to qualified ABLE programs, shall apply, except as otherwise provided.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The amendments made by Section
70115(a)(2) of the One Big Beautiful Bill Act (Public Law 119-21) to Section 529A(b)(2)(B)(ii) of the Internal Revenue Code, relating to qualified ABLE programs, shall apply for contributions made on or after January 1, 2026, except as otherwise provided.
</html:p>
</ns0:Content>
</ns0:LawSectionVersion>
</ns0:LawSection>
</ns0:Fragment>
</ns0:BillSection>
<ns0:BillSection id="id_135E005A-224D-4AC4-A403-0E95852F0E65">
<ns0:Num>SEC. 3.</ns0:Num>
<ns0:ActionLine action="IS_AMENDED" ns3:type="locator" ns3:href="urn:caml:codes:RTC:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'DIVISION'%20and%20caml%3ANum%3D'2.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'PART'%20and%20caml%3ANum%3D'11.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'CHAPTER'%20and%20caml%3ANum%3D'4.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'ARTICLE'%20and%20caml%3ANum%3D'1.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'23711.4.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 23711.4 of the
<ns0:DocName>Revenue and Taxation Code</ns0:DocName>
is amended to read:
</ns0:ActionLine>
<ns0:Fragment>
<ns0:LawSection id="id_4824400F-7D8D-4923-9E43-4B708197A9C4">
<ns0:Num>23711.4.</ns0:Num>
<ns0:LawSectionVersion id="id_3C49AF86-FAA6-480E-A1BA-E1BB87B83452">
<ns0:Content>
<html:p>For taxable years beginning on or after January 1, 2016, Section 529A of the Internal Revenue Code, relating to qualified ABLE programs, added by Section 102 of Division B of Public Law 113-295, shall apply, except as otherwise provided.</html:p>
<html:p>
(a)
<html:span class="EnSpace"/>
Section 529A(a) of the Internal Revenue Code is modified as follows:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
By substituting the phrase “under Part 10 (commencing with Section 17001) and this part” in lieu of the phrase “under this subtitle.”
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
By substituting “Article 2 (commencing with Section 23731)” in lieu of “Section 511.”
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
Section 529A(c)(3)(A) of the Internal Revenue Code is
modified by substituting “2.5 percent” in lieu of “10 percent.”
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
A copy of the report required to be filed with the Secretary of the Treasury under Section 529A(d) of the Internal Revenue Code, relating to reports shall be filed with the Franchise Tax Board at the same time and in the same manner as specified in that section.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
The amendments made by Section 303(a) of Division Q of the Consolidated Appropriations Act, 2016 (Public Law 114-113) to Section 529A(b)(1) of the Internal Revenue Code, relating to qualified ABLE programs, shall apply, except as otherwise provided.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The amendments made by Section 303(b) of Division Q of the Consolidated Appropriations Act, 2016 (Public Law 114-113) to Sections 529A(d)(3) and 529A(e) of the Internal Revenue Code, relating to qualified ABLE
programs, shall apply, except as otherwise provided.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
The amendments made by Section 303(c) of Division Q of the Consolidated Appropriations Act, 2016 (Public Law 114-113) to Sections 529A(d)(4) and 529A(c)(1)(C)(i) of the Internal Revenue Code, relating to qualified ABLE programs, shall apply, except as otherwise provided.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
The amendments made by Section 11024(a) of the Tax Cuts and Jobs Act (Public Law 115-97) to Section 529A(b)(2)(B) of the Internal Revenue Code, relating to qualified ABLE programs, shall apply, except as otherwise provided.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
For taxable years beginning on or after January 1, 2026, the amendments made by Section 124 of the Consolidated Appropriations Act, 2023 (Public Law 117-328) to Section 529A(e) of the Internal Revenue Code, relating to qualified ABLE
programs, shall apply, except as otherwise provided.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
For purposes of complying with Section 41, the goal, purpose, objective, performance indicators, and data collection requirements for the tax expenditure allowed by this subdivision shall be as specified in subdivision (f) of Section 17140.4.
</html:p>
<html:p>
(g)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
For taxable years beginning on or after January 1, 2026, the amendments made by Section 70115(a)(1) of the One Big Beautiful Bill Act (Public Law 119-21) to Section 529A(b)(2)(B)(i) of the Internal Revenue Code, relating to qualified ABLE programs, shall apply, except as otherwise provided.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The
amendments made by Section 70115(a)(2) of the One Big Beautiful Bill Act (Public Law 119-21) to Section 529A(b)(2)(B)(ii) of the Internal Revenue Code, relating to qualified ABLE programs, shall apply for contributions made on or after January 1, 2026, except as otherwise provided.
</html:p>
</ns0:Content>
</ns0:LawSectionVersion>
</ns0:LawSection>
</ns0:Fragment>
</ns0:BillSection>
<ns0:BillSection id="id_999DA962-8CBD-43A6-916D-309F115EAA5C">
<ns0:Num>SEC. 4.</ns0:Num>
<ns0:ActionLine action="IS_AMENDED" ns3:type="locator" ns3:href="urn:caml:codes:WIC:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'DIVISION'%20and%20caml%3ANum%3D'4.5.'%5D%2Fcaml%3ALawHeading%5B%40type%3D'CHAPTER'%20and%20caml%3ANum%3D'15.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'4879.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 4879 of the
<ns0:DocName>Welfare and Institutions Code</ns0:DocName>
is amended to read:
</ns0:ActionLine>
<ns0:Fragment>
<ns0:LawSection id="id_B06EA3ED-3D63-46F8-BD6A-F0F44FA8DAE0">
<ns0:Num>4879.</ns0:Num>
<ns0:LawSectionVersion id="id_C587BA8C-C97D-48BC-B0A5-3A269D64D373">
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
Under the program, a person may make contributions for a taxable year, for the benefit of an individual who is an eligible individual for that taxable year, to an ABLE account that is established for the purpose of meeting the qualified disability expenses of the designated beneficiary of the account if both of the following criteria are met:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
The designated beneficiary is limited to one ABLE account for purposes of this chapter.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The ABLE account is established only for a designated beneficiary who is a resident of the United States.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
A contribution shall not be accepted if either of the following occurs:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
The contribution is not in cash.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Except in the case of contributions under Section 529A(c)(1)(C) of the Internal Revenue Code, relating to change in designated beneficiaries or programs, the contribution to an ABLE account would result in aggregate contributions from all contributors to the ABLE account for the taxable year exceeding the amount of both of the following:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
The amount allowed under Section 2503(b) of the Internal Revenue Code, relating to exclusion from gifts, for the calendar year in which the taxable year begins.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
In the case of any contribution by a designated beneficiary described in Section 529A(b)(7) of the Internal Revenue
Code,
the lesser of either of the following:
</html:p>
<html:p>
(i)
<html:span class="EnSpace"/>
Compensation, as defined by Section 219(f)(1) of the Internal Revenue Code, includible in the designated beneficiary’s gross income for the taxable year.
</html:p>
<html:p>
(ii)
<html:span class="EnSpace"/>
An amount equal to the poverty line for a one-person household as promulgated under Section 9902(2) of Title 42 of the United States Code, for the calendar year preceding the calendar year in which the taxable year begins.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
The designated beneficiary shall retain ownership of all contributions made to the designated beneficiary’s ABLE account to the date of utilization for qualified disability expenses, and all interest derived from the investment of the contributions to the designated beneficiary’s ABLE account shall be deemed to be held in the ABLE program trust for the benefit of the designated
beneficiary. Neither the contributions, nor any interest derived therefrom, may be pledged as collateral for any loan.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
The board shall develop adequate safeguards to prevent aggregate contributions on behalf of a designated beneficiary in excess of the maximum contribution limits necessary to provide for the qualified disability expenses of the designated beneficiary. For purposes of this subdivision, aggregate contributions include contributions under any prior qualified ABLE program of any state or agency or instrumentality thereof.
</html:p>
</ns0:Content>
</ns0:LawSectionVersion>
</ns0:LawSection>
</ns0:Fragment>
</ns0:BillSection>
</ns0:Bill>
</ns0:MeasureDoc>