Real property tax: Personal Income Tax Law: homeowners’ exemption: renter’s credit.

Senator Grove's proposal to modify California's homeowner and renter tax benefits would increase the homeowners' property tax exemption from $7,000 to $50,000 for residents aged 62 and older, beginning in fiscal year 2026-27. The legislation also raises the renter's tax credit for eligible seniors to $550 for joint filers and $275 for individual filers, up from the current $120 and $60 respectively.

The bill maintains existing eligibility requirements for the homeowners' exemption, including provisions for temporary displacement due to disasters or medical care. Properties that are rented, vacant, under construction, or serving as vacation homes remain ineligible, as do properties receiving veterans' exemptions. For renters, the enhanced credit applies to those with adjusted gross incomes under $50,000 for joint filers and $25,000 for individuals, with these thresholds continuing to adjust annually for inflation.

Local governments would not receive state reimbursement for property tax revenue reductions resulting from the increased homeowners' exemption. The Franchise Tax Board must track utilization rates and average credit amounts, reporting annually to legislative committees beginning May 2027 to measure the program's reach among older homeowners and renters.