At a glance
- The measure would impose a one-time 5% tax on the net worth of billionaires who were California residents on Jan. 1, 2026, due in 2027.
- Moving now would not change a client's Prop 40 exposure because the measure looks back to who lived in California on Jan. 1, 2026.
- Two competing measures, Propositions 41 and 42, would effectively nullify the billionaire tax if more votes are cast for either one.
California voters appeared set to reject Proposition 40, the proposed billionaire wealth tax, in early returns, InvestmentNews reported.
The measure would impose a one-time 5% tax on the net worth of billionaires who were California residents on Jan. 1, 2026, due in 2027. The Associated Press showed it trailing 57% to 43% Tuesday night and had not called the race by Wednesday morning, with votes still uncounted.
Moving now would not change a client's Prop 40 exposure because the measure looks back to who lived in California on Jan. 1, 2026. A move affects only how clients are taxed going forward, Debra Taylor, managing partner and chief tax strategist at Carson Wealth, told InvestmentNews. She said residency has become a front-burner conversation even for clients far below $1 billion.
Two competing measures, Propositions 41 and 42, would effectively nullify the billionaire tax if more votes are cast for either one. Taylor said the measure's certification would apply to every California resident who files a return, signed under penalty of perjury.
Reported by the RIA desk from InvestmentNews. Published . Updated Nov 4, 2026 · 10:36 a.m. ET. Corrections