Amended in Assembly August 19, 2016

Amended in Assembly June 27, 2016

Amended in Senate March 29, 2016

Senate BillNo. 909


Introduced by Senator Beall

(Coauthors: Senators Anderson and Hancock)

January 26, 2016


An act to amend Section 20583 of the Revenue and Taxation Code, relating to taxation.

LEGISLATIVE COUNSEL’S DIGEST

SB 909, as amended, Beall. Property tax postponement: special needs trust claimants.

Existing law authorizes the Controller, upon approval of a claim for the postponement of ad valorem property taxes, to directly pay a county tax collector for the property taxes owed by the claimant, as provided. Existing law requires all sums paid for the postponement of property taxes pursuant to these provisions to be secured by a lien in favor of the state. Amounts owed by a claimant are due if the claimant, or his or her surviving spouse, ceases to occupy the premises as his or her residential dwelling, dies, disposes of the property, or allows specified taxes and special assessments to become delinquent, as provided. Existing law requires that the residential dwelling be owned by the claimant, the claimant and spouse, or the claimant and another specified individual. Existing law requires a claimant to file a claim containing specified information, including a description of the residential dwelling, under penalty of perjury.

This bill would provide that “owned” for these purposes includes the interest of a beneficiary of a special needs trust.

begin insert

This bill would incorporate additional changes to Section 20583 of the Revenue and Taxation Code proposed by AB 1952 that would become operative if both bills are enacted and this bill is enacted last.

end insert

By requiring a special needs trust claimant for property tax postponement to file certain information under penalty of perjury, thereby expanding the crime of perjury, this 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 no reimbursement is required by this act for a specified reason.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

The people of the State of California do enact as follows:

P2    1

SECTION 1.  

Section 20583 of the Revenue and Taxation Code
2 is amended to read:

3

20583.  

(a) “Residential dwelling” means a dwelling occupied
4as the principal place of residence of the claimant and so much of
5the land surrounding it as is reasonably necessary for use of the
6dwelling as a home, owned by the claimant, the claimant and
7spouse, or by the claimant and either another individual eligible
8for postponement under this chapter or an individual described in
9subdivision (a), (b), or (c) of Section 20511 and located in this
10state. It shall include condominiums that are assessed as realty for
11local property tax purposes. It also includes part of a multidwelling
12or multipurpose building and a part of the land upon which it is
13built.

14(b) As used in this chapter in reference to ownership interests
15in residential dwellings, “owned” includes (1) the interest of a
16vendee in possession under a land sale contract provided that the
17contract or memorandum thereof is recorded and only from the
18date of recordation of the contract or memorandum thereof in the
19office of the county recorder where the residential dwelling is
20located, (2) the interest of the holder of a life estate provided that
21the instrument creating the life estate is recorded and only from
P3    1the date of recordation of the instrument creating the life estate in
2the office of the county recorder where the residential dwelling is
3located, but “owned” does not include the interest of the holder of
4any remainder interest or the holder of a reversionary interest in
5the residential dwelling, (3) the interest of a joint tenant or a tenant
6in common in the residential dwelling or the interest of a tenant
7where title is held in tenancy by the entirety or a community
8property interest where title is held as community property, and
9(4) the interest, including the interest of a beneficiary of a special
10needs trust, in the residential dwelling in which the title is held in
11trust, as described in subdivision (d) of Section 62, provided that
12the Controller determines that the state’s interest is adequately
13protected.

14(c) Except as provided in subdivision (c), and Chapter 3
15(commencing with Section 20625), ownership must be evidenced
16by an instrument duly recorded in the office of the county where
17the residential dwelling is located.

18(d) “Residential dwelling” does not include any of the following:

19(1) Any residential dwelling in which the owners do not have
20 an equity of at least 40 percent of the full value of the property as
21determined for purposes of property taxation or at least 40 percent
22of the fair market value as determined by the Controller and where
23the Controller determines that the state’s interest is adequately
24protected. The 40-percent equity requirement shall be met each
25time the claimant or authorized agent files a postponement claim.

26(2) Any residential dwelling in which the claimant’s interest is
27held pursuant to a contract of sale or under a life estate, unless the
28claimant obtains the written consent of the vendor under the
29contract of sale, or the holder of the reversionary interest upon
30termination of the life estate, for the postponement of taxes and
31the creation of a lien on the real property in favor of the state for
32amounts postponed pursuant to this act.

33(3) Any residential dwelling on which the claimant does not
34receive a secured tax bill.

35(4) Any residential dwelling in which the claimant’s interest is
36held as a possessory interest, except as provided in Chapter 3.5
37(commencing with Section 20640).

38begin insert

begin insertSEC. 1end insertbegin insert.5.end insert  

end insert

begin insertSection 20583 of the end insertbegin insertRevenue and Taxation Codeend insertbegin insert is
39amended to read:end insert

P4    1

20583.  

(a) “Residential dwelling” means a dwelling occupied
2as the principal place of residence of thebegin delete claimant,end deletebegin insert claimantend insert and
3so much of the land surrounding it as is reasonably necessary for
4use of the dwelling as a home, owned by the claimant, the claimant
5and spouse, or by the claimant and either another individual eligible
6for postponement under this chapter or an individual described in
7subdivision (a), (b), or (c) of Section 20511 and located in this
8state. It shall include condominiums that are assessed as realty for
9local property tax purposes. It also includes part of a multidwelling
10or multipurpose building and a part of the land upon which it is
11built.

12(b) As used in this chapter in reference to ownership interests
13in residential dwellings, “owned” includes (1) the interest of a
14vendee in possession under a land sale contract provided that the
15contract or memorandum thereof is recorded and only from the
16date of recordation of the contract or memorandum thereof in the
17office of the county recorder where the residential dwelling is
18located, (2) the interest of the holder of a life estate provided that
19the instrument creating the life estate is recorded and only from
20the date of recordation of the instrument creating the life estate in
21the office of the county recorder where the residential dwelling is
22located, but “owned” does not include the interest of the holder of
23any remainder interest or the holder of a reversionary interest in
24the residential dwelling, (3) the interest of a joint tenant or a tenant
25in common in the residential dwelling or the interest of a tenant
26where title is held in tenancy by the entirety or a community
27property interest where title is held as community property, and
28(4) thebegin delete interestend deletebegin insert interest, including the interest of a beneficiary of
29a special needs trust,end insert
in the residential dwelling in which the title
30is held in trust, as described in subdivision (d) of Section 62,
31provided that the Controller determines that the state’s interest is
32adequately protected.

33(c) Except as provided in subdivision (c), and Chapter 3
34(commencing with Section 20625), ownership must be evidenced
35by an instrument duly recorded in the office of the county where
36the residential dwelling is located.

37(d) “Residential dwelling” does not include any of the following:

38(1) Any residential dwelling in which the owners do not have
39an equity of at least 40 percent of the full value of the property as
40determined for purposes of property taxation or at least 40 percent
P5    1of the fair market value as determined by the Controller and where
2the Controller determines that the state’s interest is adequately
3protected. The 40-percent equity requirement shall be met each
4time the claimant or authorized agent files a postponement claim.

5(2) Any residential dwelling in which the claimant’s interest is
6held pursuant to a contract of sale or under a life estate, unless the
7claimant obtains the written consent of the vendor under the
8contract of sale, or the holder of the reversionary interest upon
9termination of the life estate, for the postponement of taxes and
10the creation of a lien on the real property in favor of the state for
11amounts postponed pursuant to this act.

12(3) Any residential dwelling on which the claimant does not
13receive a secured tax bill.

14(4) Any residential dwelling in which the claimant’s interest is
15held as a possessory interest, except as provided in Chapter 3.5
16(commencing with Section 20640).

begin insert

17
(5) Any residential dwelling that is subject to a Property
18Assessed Clean Energy bond, or PACE bond, as defined in Section
1926054 of the Public Resources Code.

end insert
20begin insert

begin insertSEC. 2.end insert  

end insert
begin insert

Section 1.5 of this bill incorporates amendments to
21Section 20583 of the Revenue and Taxation Code proposed by
22both this bill and Assembly Bill 1952. It shall only become
23operative if (1) both bills are enacted and become effective on or
24before January 1, 2017, (2) each bill amends Section 20583 of the
25Revenue and Taxation Code, and (3) this bill is enacted after
26Assembly Bill 1952, in which case Section 1 of this bill shall not
27become operative.

end insert
28

begin deleteSEC. 2.end delete
29
begin insertSEC. 3.end insert  

No reimbursement is required by this act pursuant to
30Section 6 of Article XIII B of the California Constitution because
31the only costs that may be incurred by a local agency or school
32district will be incurred because this act creates a new crime or
33infraction, eliminates a crime or infraction, or changes the penalty
34for a crime or infraction, within the meaning of Section 17556 of
35the Government Code, or changes the definition of a crime within
36the meaning of Section 6 of Article XIII B of the California
37Constitution.



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