AB-755 • 2026

Income tax: exclusion: disasters.

Taxes

Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor: Tangipa
Last action: 2026-02-02
Official status: From committee: Filed with the Chief Clerk pursuant to Joint Rule 56.
Effective date: Not listed

Plain English Breakdown

The bill summary does not provide specific details on how the exclusion is applied beyond the taxable years immediately following the disaster.

Income Tax Exclusion for Disaster Victims

AB-755 provides an income tax exclusion of up to $300,000 per year for individuals affected by disasters that burned or made their real property, residence, or business uninhabitable during the taxable year in which the disaster occurred and the following year.

What This Bill Does

Provides an exclusion from gross income for amounts received as income not exceeding $300,000 per taxable year by a qualified taxpayer whose real property, residence, or business burned or was deemed uninhabitable due to a disaster during the taxable year in which the disaster occurred and the following taxable year.
Applies this exclusion for taxable years beginning on or after January 1, 2025, and before January 1, 2035.

Who It Names or Affects

Individuals who lost real property, residence, or business due to a disaster that burned or made it uninhabitable during the taxable year in which the disaster occurred and the following year.
The state's tax system for personal income taxes.

Terms To Know

Taxable Year: A period of time (usually one calendar year) used as a basis for calculating income tax liability.
Disaster: An event that causes significant damage or destruction to real property, residence, or business and makes it uninhabitable or unusable.

Limits and Unknowns

The exclusion applies only for taxable years starting from January 1, 2025, through December 31, 2034.
It does not specify what happens if the disaster occurs in one year but affects income in subsequent years beyond the following taxable year.

Bill History

2026-02-02 California Legislative Information
From committee: Filed with the Chief Clerk pursuant to Joint Rule 56.
2026-01-31 California Legislative Information
Died pursuant to Art. IV, Sec. 10(c) of the Constitution.
2025-03-24 California Legislative Information
In committee: Set, first hearing. Hearing canceled at the request of author.
2025-03-03 California Legislative Information
Referred to Com. on REV. & TAX.
2025-02-19 California Legislative Information
From printer. May be heard in committee March 21.
2025-02-18 California Legislative Information
Read first time. To print.

Official Summary Text

AB 755, as introduced, Tangipa.
Income tax: exclusion: disasters.
The Personal Income Tax Law and the Corporation Tax Law, in modified conformity with federal income tax law, generally defines “gross income” as income from whatever source derived, except as specifically excluded, and provides various exclusions from gross income.
This bill, for taxable years beginning on or after January 1, 2025, and before January 1, 2035, would provide an exclusion from gross income for amounts received as income, not to exceed $300,000 per taxable year, by a qualified taxpayer whose real property, residence, or business burned or was deemed uninhabitable due to a disaster, as defined, during the taxable year in which the disaster occurred and the following taxable year.
Existing law requires any bill authorizing a new tax expenditure to contain, among other things, specific goals
that the tax expenditure will achieve, detailed performance indicators, and data collection requirements.
This bill would include additional information required for any bill authorizing a new tax expenditure.
This bill would take effect immediately as a tax levy.

Current Bill Text

Read the full stored bill text

Download Bill PDF