SB-376
Budget & Economy

Incomplete gift nongrantor trusts: Personal Income Tax Law.

Engrossed
CA
2025-2026 Regular Session
0
0
Track

Key Takeaways

  • Excludes charitable remainder trusts from incomplete gift nongrantor trust tax requirements.
  • Requires 90% of qualifying trust income to be distributed to charitable organizations.
  • Grants the Franchise Tax Board authority to establish implementation regulations.

Summary

Senator Valladares's proposed modification to California's tax treatment of incomplete gift nongrantor trusts carves out a specific exemption for charitable remainder trusts while maintaining existing regulations on trust income taxation.

The legislation refines how incomplete gift nongrantor trusts are defined and taxed under state law. Under current rules, income from these trusts is generally included in the grantor's gross income. The bill creates an explicit exemption for trusts that qualify as charitable remainder trusts under Section 664 of the Internal Revenue Code. Additionally, trust income may be excluded from a grantor's gross income when the trust distributes at least 90% of its distributable net income to charitable organizations and meets specific filing requirements with the Franchise Tax Board.

The Franchise Tax Board receives authority to develop implementing regulations and guidelines outside the standard administrative rulemaking process. According to the bill's findings, this modification aims to preserve charitable giving through these trust structures, though the legislation notes no data collection requirements accompany the changes. As a tax levy, the provisions would take effect immediately upon enactment.

Key Dates

Next Step
Referred to the Assembly Standing Committee on Revenue and Taxation
Next Step
Assembly Committee
Referred to the Assembly Standing Committee on Revenue and Taxation
Hearing has not been scheduled yet
Vote on Senate Floor
Senate Floor
Vote on Senate Floor
Senate 3rd Reading SB376 Valladares
Senate Revenue and Taxation Hearing
Senate Committee
Senate Revenue and Taxation Hearing
Do pass, but first be re-referred to the Committee on [Appropriations]
Introduced
Senate Floor
Introduced
Introduced. Read first time. To Com. on RLS. for assignment. To print.

Contacts

Profile
Sharon Quirk-SilvaD
Assemblymember
Committee Member
Not Contacted
Not Contacted
Profile
Mike GipsonD
Assemblymember
Committee Member
Not Contacted
Not Contacted
Profile
Tina McKinnorD
Assemblymember
Committee Member
Not Contacted
Not Contacted
Profile
Jasmeet BainsD
Assemblymember
Committee Member
Not Contacted
Not Contacted
Profile
Tri TaR
Assemblymember
Committee Member
Not Contacted
Not Contacted
0 of 8 row(s) selected.
Page 1 of 2
Select All Legislators
Profile
Sharon Quirk-SilvaD
Assemblymember
Committee Member
Profile
Mike GipsonD
Assemblymember
Committee Member
Profile
Tina McKinnorD
Assemblymember
Committee Member
Profile
Jasmeet BainsD
Assemblymember
Committee Member
Profile
Tri TaR
Assemblymember
Committee Member
Profile
Carl DeMaioR
Assemblymember
Committee Member
Profile
Robert GarciaD
Assemblymember
Committee Member
Profile
Suzette ValladaresR
Senator
Bill Author

Get Involved

Act Now!

Email the authors or create an email template to send to all relevant legislators.

Introduced By

Suzette Valladares
Suzette ValladaresR
California State Senator
40% progression
Bill has passed all readings in its first house and is ready to move to the other house (6/2/2025)

Latest Voting History

June 2, 2025
PASS
Senate Floor
Vote on Senate Floor
AyesNoesNVRTotalResult
380240PASS

Key Takeaways

  • Excludes charitable remainder trusts from incomplete gift nongrantor trust tax requirements.
  • Requires 90% of qualifying trust income to be distributed to charitable organizations.
  • Grants the Franchise Tax Board authority to establish implementation regulations.

Get Involved

Act Now!

Email the authors or create an email template to send to all relevant legislators.

Introduced By

Suzette Valladares
Suzette ValladaresR
California State Senator

Summary

Senator Valladares's proposed modification to California's tax treatment of incomplete gift nongrantor trusts carves out a specific exemption for charitable remainder trusts while maintaining existing regulations on trust income taxation.

The legislation refines how incomplete gift nongrantor trusts are defined and taxed under state law. Under current rules, income from these trusts is generally included in the grantor's gross income. The bill creates an explicit exemption for trusts that qualify as charitable remainder trusts under Section 664 of the Internal Revenue Code. Additionally, trust income may be excluded from a grantor's gross income when the trust distributes at least 90% of its distributable net income to charitable organizations and meets specific filing requirements with the Franchise Tax Board.

The Franchise Tax Board receives authority to develop implementing regulations and guidelines outside the standard administrative rulemaking process. According to the bill's findings, this modification aims to preserve charitable giving through these trust structures, though the legislation notes no data collection requirements accompany the changes. As a tax levy, the provisions would take effect immediately upon enactment.

40% progression
Bill has passed all readings in its first house and is ready to move to the other house (6/2/2025)

Key Dates

Next Step
Referred to the Assembly Standing Committee on Revenue and Taxation
Next Step
Assembly Committee
Referred to the Assembly Standing Committee on Revenue and Taxation
Hearing has not been scheduled yet
Vote on Senate Floor
Senate Floor
Vote on Senate Floor
Senate 3rd Reading SB376 Valladares
Senate Revenue and Taxation Hearing
Senate Committee
Senate Revenue and Taxation Hearing
Do pass, but first be re-referred to the Committee on [Appropriations]
Introduced
Senate Floor
Introduced
Introduced. Read first time. To Com. on RLS. for assignment. To print.

Latest Voting History

June 2, 2025
PASS
Senate Floor
Vote on Senate Floor
AyesNoesNVRTotalResult
380240PASS

Contacts

Profile
Sharon Quirk-SilvaD
Assemblymember
Committee Member
Not Contacted
Not Contacted
Profile
Mike GipsonD
Assemblymember
Committee Member
Not Contacted
Not Contacted
Profile
Tina McKinnorD
Assemblymember
Committee Member
Not Contacted
Not Contacted
Profile
Jasmeet BainsD
Assemblymember
Committee Member
Not Contacted
Not Contacted
Profile
Tri TaR
Assemblymember
Committee Member
Not Contacted
Not Contacted
0 of 8 row(s) selected.
Page 1 of 2
Select All Legislators
Profile
Sharon Quirk-SilvaD
Assemblymember
Committee Member
Profile
Mike GipsonD
Assemblymember
Committee Member
Profile
Tina McKinnorD
Assemblymember
Committee Member
Profile
Jasmeet BainsD
Assemblymember
Committee Member
Profile
Tri TaR
Assemblymember
Committee Member
Profile
Carl DeMaioR
Assemblymember
Committee Member
Profile
Robert GarciaD
Assemblymember
Committee Member
Profile
Suzette ValladaresR
Senator
Bill Author