CA SB1277

Creates a refundable cost-of-living tax credit for California residents effective January 1, 2027, through January 1, 2032

Single filers earning $75,000 or less receive $350 (no dependents) or $700 (with dependents); joint filers earning $150,000 or less receive $700 (no dependents) or $1,050 (with dependents)

Credit amounts decrease at higher income levels, with eligibility phasing out entirely above $250,000 for single filers and $500,000 for joint filers/heads of household

Taxpayers must have resided in California for at least six months in the prior tax year and be a current resident to qualify

Refund amounts are excluded from gross income for state tax purposes, and excess credits beyond tax liability are refunded directly to taxpayers