California Senate Bill SB711

California 2025-2026 Regular Session

• Introduced: 2/21/25
• Refer: 3/12/25
• Refer: 3/26/25
• Refer: 4/2/25
• Report Pass: 4/28/25
• Refer: 4/29/25
• Report Pass: 5/23/25
• Engrossed: 5/28/25
• Refer: 6/5/25
• Refer: 7/7/25
• Report Pass: 7/15/25
• Refer: 7/15/25
• Report Pass: 8/29/25
• Enrolled: 9/11/25
• Chaptered: 10/1/25
• Passed: 10/1/25

Caption

An act to amend Sections 17024.5, 17052.6, 17052.12, 17053.91, 17062, 17063, 17076, 17085, 17087.5, 17131.4, 17131.8, 17140, 17140.3, 17144.5, 17201.6, 17204, 17220, 17225, 17241, 17250, 17255, 17270, 17271, 17276, 17323, 17501, 17551, 17559, 17560.5, 17564, 18031.5, 18036, 18042, 18409, 18622.5, 18631.7, 18666, 19058, 19141.5, 19144, 19167, 19183, 19852, 19900, 23400, 23453, 23455, 23456, 23609, 23691, 23711, 23806, 23809, 24308.6, 24344, 24349.1, 24356, 24357, 24358, 24365, 24416, 24440, 24459, 24465, 24601, 24661.5, 24661.6, 24673.2, 24721, and 24990.5 of, to amend and repeal Sections 17302 and 17737 of, to add Sections 17062.1, 17088.1, 17131.11, 17149.1, 17149.2, 17156.2, 17158.4, 17158.5, 17201.1, 17204.2, 17250.1, 17250.2, 17321.1, 17322.5, 17324, 17501.8, 17567, 18045, 18151.9, 19907, 21003.1, 24345.6, 24345.7, 24356.1, 24428, 24430, 24454.1, 24457, 24471.5, 24661.4, 24670, 24876, 24990.1, and 24990.9 to, to add and repeal Sections 17091 and 17201.3 of, to repeal Sections 17204.7, 17275.3, 17276.05, 24416.05, and 24462 of, and to repeal and add Sections 17062.3 and 23456.5 of, the Revenue and Taxation Code, relating to taxation, and declaring the urgency thereof, to take effect immediately.

Summary

SB 711 is a broad California tax conformity bill that updates the state’s reference date for many provisions of the Internal Revenue Code from January 1, 2015 to January 1, 2025 for taxable years beginning on or after January 1, 2025. By doing so, it brings a large set of federal tax changes into California law unless the state has specifically decoupled from them. The bill also makes numerous targeted conformity and nonconformity changes across the Personal Income Tax Law and Corporation Tax Law, including rules affecting research credits, net operating losses, alimony, retirement accounts, deferred compensation, capital gains and losses, disaster-related exclusions, partnership audits, and historic rehabilitation credits. The bill’s practical effect is to update California tax law to reflect many federal changes enacted over the last decade while preserving or modifying others to fit state policy. It amends existing statutes, adds new sections, repeals obsolete provisions, and in several places expressly rejects federal provisions such as certain TCJA-era limitations, some disaster relief exclusions, and some business deduction changes. It also extends or clarifies state treatment of items like Roth IRA rollovers, 529 plans, PPP forgiveness, EIDL advances, and the state historic rehabilitation credit program, while setting or preserving California-specific limits and administrative rules. SB 711 was enacted as an urgency statute, meaning it took effect immediately, and the legislative history shows strong support overall. Committee and floor votes were overwhelmingly favorable, with several unanimous or near-unanimous votes and only isolated opposition at a few stages. The bill was chaptered by the Secretary of State on October 1, 2025, indicating it became law after passage through both houses and gubernatorial approval. The main points of contention are not reflected in committee transcripts, but the structure of the bill suggests likely policy disagreements over how much California should conform to federal tax law versus maintain independent rules. Areas that often draw debate include the fiscal impact of conformity, the treatment of business deductions and losses, the scope of tax relief for individuals and businesses, and whether certain federal changes should be adopted or rejected. The urgency clause and the bill’s broad reach across many tax provisions likely also made it a significant administrative and budgetary measure for the Franchise Tax Board and taxpayers alike.

Impact

SB 711 substantially revises the Revenue and Taxation Code by updating California’s federal conformity date to January 1, 2025 and by selectively incorporating, modifying, or rejecting numerous federal tax provisions. It affects both individual and corporate taxpayers, including rules for credits, deductions, depreciation, net operating losses, alimony, retirement savings, partnership audits, and special exclusions for disaster relief and pandemic-related assistance. The bill also repeals obsolete provisions and creates or extends several state-specific rules, including historic rehabilitation credits and various decouplings from federal law.

Sentiment

The overall sentiment around SB 711 appears strongly supportive and largely noncontroversial in the recorded votes. The bill advanced with broad bipartisan approval at multiple stages, including several unanimous committee votes and very large floor majorities, and it ultimately passed as an urgency measure. The absence of committee transcript opposition in the provided record suggests the bill was viewed primarily as a technical but important conformity update rather than a highly contested policy fight.

Contention

The likely areas of contention are the bill’s fiscal and policy choices about conformity: which federal changes California should adopt, which it should reject, and how those choices affect state revenue and taxpayer liability. Business groups and tax practitioners may have focused on provisions affecting net operating losses, depreciation, research credits, and partnership audit rules, while consumer or taxpayer advocates may have been more interested in alimony, retirement, disaster relief, and housing-related credits. The urgency clause and immediate effective date may also have raised concerns about implementation timing for the Franchise Tax Board and taxpayers who must adjust to the new conformity rules quickly.