Governor Newsom Signs Legacy Fulfillment Act

Governor Newsom has officially signed Senate Bill 1288 into law! When Californians designate nonprofits or individuals as beneficiaries of their retirement and brokerage accounts, they do this with a clear expectation: that their hard-earned legacy will support a charitable cause or person they love – swiftly, privately, and without burdensome financial red tape.

State law has not required financial institutions to notify beneficiaries of non-probate assets (like IRAs, 401ks) when an account holder passes away, leaving millions of potentially charitable dollars at risk. SB 1288’s reforms ensure donor intent is respected in a timely and efficient manner.

CalNonprofits is proud to have co-sponsored SB 1288 with our partners at Valley Humane Society and San Diego Humane Society, working closely under the leadership of Senator John Laird. This collaboration helped to establish clear requirements for financial institutions:

✅ Mandatory Notice: Financial institutions must now proactively notify non-probate beneficiaries – both nonprofits and individuals – so gifts reach their intended destination.

✅ Streamlined Access: Removes administrative roadblocks, such as forcing nonprofits to open new accounts just to claim funds or requesting invasive personal data from nonprofit board members.

✅ Equal Treatment for Individual Beneficiaries: While similar bills have passed in other states, California raised the bar by expanding these vital safeguards to include individual beneficiaries, and not just nonprofit beneficiaries.

“SB 1288 is a win for all California nonprofits because it ensures donor intent is respected and community impact is prioritized. By removing unnecessary delays and ensuring gifts are transferred in good faith, this bill protects the vital funding our communities rely on. We deeply appreciate Senator Laird’s leadership in championing this commonsense protection for our sector and the people we serve.” – Geoff Green, CEO of CalNonprofits.

To secure this win, our coalition worked with industry stakeholders to resolve concerns from the Securities Industry and Financial Markets Association (SIFMA), and the broader banking industry. By addressing these objections head-on, we built a path for near-unanimous legislative support.

Thank you to all of our members and advocacy partners whose voices helped make this victory a reality!