California estate planning and elder-law landscapes are shifting in important ways for 2025-2026, signaling new opportunities and complexities for homeowners, retirees, and their advisors. Two major developments demand attention.

First, under Assembly Bill 2016 (effective April 1, 2025), California will expand eligibility to bypass full probate for certain estates. For a decedent’s primary residence valued at $750,000 or less, heirs may now file a Petition to Determine Succession to Real Property instead of undergoing traditional probate. In addition, the threshold for small estates used for personal property (bank accounts, vehicles, etc.) has increased to $208,850. These changes are intended to reduce cost, delay and formalities for many middle-class families. But they come with limitations: only a principal home qualifies (not vacation homes or rentals), the decedent must have died on or after April 1, 2025, and valuation must be at date of death with no reduction for mortgages or liens.

Second, starting January 1, 2026, California will reintroduce asset limits for many non-MAGI (long-term care and aged/disabled) programs under MediCal. After a period where eligibility expanded and asset tests were removed, asset limits return: $130,000 for an individual and $195,000 for a couple, with additional allowances for extra household members. Transfer-penalty (look-back) rules will also resume. These changes mean seniors and families pursuing long-term-care coverage must act now: review their current estate/asset-transfer plans, avoid large gifts, and ensure trusts and asset holding strategies are aligned before the limit reinstatement.

Together, these updates highlight why estate-planning remains a dynamic field: homeowners may gain simplified probate options, yet those approaching long-term care planning face renewed eligibility constraints. Working with experienced counsel to evaluate existing trusts, wills, and asset-positioning is critical in this evolving environment.