SACRAMENTO – The California Legislature this week passed Senate Bill 1288 by Senator John Laird, legislation to ensure gifts left to beneficiaries, including nonprofits, are delivered efficiently and without unnecessary barriers. The bill now heads to Governor Gavin Newsom for consideration.

“Donors should be able to trust that the wishes they put in writing will be honored,” said Laird. “SB 1288 creates a clearer, more straightforward process for beneficiaries to receive the assets intended for them, while removing unnecessary barriers that can delay or prevent those gifts from reaching their destination. I’m pleased to see this measure pass the Legislature and look forward to the Governor’s consideration.”

Sponsored by CalNonprofits, San Diego Humane Society, and Valley Humane Society, SB 1288 addresses longstanding gaps in how financial institutions distribute beneficiary funds after an account holder’s death – gaps that too often prevent nonprofits from receiving gifts intended to support their missions.

Currently, state law lacks a clear process for financial institutions to notify beneficiaries when an account holder dies. As a result, nonprofits and other beneficiaries may never learn they were named, and funds that go unclaimed for three years are transferred to the state. Even when beneficiaries are aware of assets left to them, they can face administrative barriers and inconsistent requirements that delay access to those funds.

SB 1288 establishes a clearer and more consistent process for distributing beneficiary funds. The bill requires financial institutions that receive proof of an account holder’s death to notify beneficiaries within 60 days, prohibits institutions from requiring beneficiaries to open accounts to receive funds, allows individual beneficiaries to receive their share without waiting for other beneficiaries to submit documentation, and standardizes the documentation nonprofits must provide to establish their legal identity and access funds.