AB 1714 California Assembly · 2025-2026 Regular Session

Personal income tax: credit: first-time homebuyer program: required repairs.

Summary

The Personal Income Tax Law allows various credits against the taxes imposed by those laws. This bill would allow a credit against those taxes for each taxable year beginning on or after January 1, 2028, and before January 1, 2033, in an amount equal to 40% of the amount paid or incurred, not to exceed $25,000, during the taxable year for repairs that are required as a condition of closing the sale of real property to a purchaser utilizing a first-time homebuyer assistance program, as specified. The bill would prohibit a taxpayer from claiming more than one credit for a taxable year or more than one taxpayer from claiming the credit with respect to a property for a taxable year. Existing law requires any bill authorizing a new tax expenditure, as defined, to include tax credits, to contain, among other things, specific goals, purposes, and objectives that the tax credit will achieve, detailed performance indicators, and data collection requirements. This bill would include findings and reporting requirements in compliance with this requirement. This bill would take effect immediately as a tax levy.

Bill status in committee 1 of 4 stages cleared

Introduction

Feb 2026

Committee Review

Floor Vote

Governor

Introduced Feb 4, 2026 Last action Apr 27, 2026

Maddy AI version diff · 2 comparisons

What changed between versions

03/23/26 - Amended Assembly → AB1714 · 4 edits

MODERATE

The final enacted version of AB 1714 significantly reduced the tax credit from 100% to 40% of qualified repair expenses, limited the carryover period from indefinite to five years, and pushed back the Franchise Tax Board reporting deadline by one year. These changes substantially reduce the financial benefit available to sellers who make required repairs for first-time homebuyer transactions while keeping the $25,000 annual cap intact.

FISCAL

The credit rate was reduced from 100% to 40% of qualified repair expenses. A seller who spent $25,000 on required repairs would now receive a $10,000 credit instead of $25,000.

REQUIREMENT

The carryover provision was changed from allowing the excess credit to carry forward indefinitely until exhausted to limiting carryover to a maximum of five years.

TIMELINE

The Franchise Tax Board performance report deadline was moved from December 1, 2033 to December 1, 2034, giving the agency an additional year to compile data.

TECHNICAL

The performance indicator language was changed from 'aggregate dollar amount of credits claimed' to 'aggregate dollar amount of credits allowed,' shifting the measurement from what taxpayers reported to what the tax authority actually approved.

02/04/26 - Introduced → 03/23/26 - Amended Assembly · 6 edits · Mar 23, 2026

MODERATE

The Assembly amendment significantly reduces the tax credit from 100% of qualified repair expenses to 40%, limits the carryover period from indefinite to five years, adds anti-duplication rules preventing multiple claims per property or per taxpayer per year, and formally defines 'cosmetic improvements' as an excluded category. These changes substantially reduce the fiscal impact of the credit while tightening eligibility controls.

FISCAL

The credit amount was reduced from 100% of qualified repair expenses to 40% of the amount paid or incurred, still capped at $25,000 per taxable year. This means a seller who spends $62,500 on required repairs would receive a $25,000 credit under the original bill but only $25,000 (40% of $62,500) under the amendment - effectively the same cap but with a much lower effective rate for smaller repair bills.

ELIGIBILITY

New subsection (d) prohibits a taxpayer from claiming more than one credit in a taxable year and requires that if property is owned by multiple taxpayers, only one may claim the credit for that property in a given year. This prevents double-dipping on shared ownership situations.

REQUIREMENT

The carryover provision was changed from allowing excess credits to carry forward indefinitely until exhausted to limiting carryover to a maximum of five years.

DEFINITION

A new formal definition of 'cosmetic improvements' was added as subsection (b)(1), defining them as modifications intended solely to improve visual appearance or aesthetic appeal that do not affect structural integrity, safety, habitability, or essential systems. This clarifies the exclusion from qualified repair expenses.

TIMELINE

The Franchise Tax Board reporting deadline was extended from December 1, 2033 to December 1, 2034, giving the agency an additional year to analyze performance indicators before reporting to the Legislature.

TECHNICAL

Substantiation requirements in subsection (c) now reference 'qualified repair expenses' instead of just 'repairs,' and the language was changed from 'in the manner prescribed' to 'in the form and manner prescribed' by the Franchise Tax Board.

Floor votes

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Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Apr 27, 2026

Lower · Passed

In committee: Set, final hearing. Held under submission.

lower

Apr 6, 2026

Committee

In committee: Set, second hearing. Referred to REV. & TAX. suspense file.

lower

Mar 24, 2026

Committee

Re-referred to Com. on REV. & TAX.

lower

Mar 23, 2026

Introduced

From committee chair, with author's amendments: Amend, and re-refer to Com. on REV. & TAX. Read second time and amended.

lower

Mar 16, 2026

Lower · Passed

In committee: Set, first hearing. Hearing canceled at the request of author.

lower

Feb 23, 2026

Committee

Referred to Com. on REV. & TAX.

lower

Feb 5, 2026

Lower · Passed

From printer. May be heard in committee March 7.

lower

1 primary · 0 co-sponsors