California tax authorities could conduct detailed residency audits of Sergey Brin, David Sacks and Travis Kalanick if voters approve a proposed billionaire tax in November. The three technology figures reportedly left California before January, the date that would determine who may owe the levy.
The proposal, known as Proposition 40, would impose a one-time tax of up to 5% on certain individuals and trusts holding more than $1 billion in covered assets. The measure will go before voters on Nov. 3, 2026, after it qualified for statewide voting.
January Residency Date Controls Liability
Proposition 40 would apply to qualifying billionaires who were California residents on Jan. 1, 2026. The tax would use asset values measured at the end of 2026 and generally become due with 2026 returns filed in 2027.
Covered wealth could include stock, business interests, bonds, intellectual property, artwork, and collectibles. Directly held real estate, pensions, and certain retirement accounts would be excluded.
Taxpayers could pay the assessment in full or spread payments over five years at an additional cost. Revenue would largely support health care, with smaller amounts available for education, food assistance, and administration.
The timing creates a central legal question for wealthy people who moved shortly before the cutoff. A mailing address or new driver’s license may support a claim, but neither automatically ends California residency.
Audits Can Examine Personal Ties
California treats a person as a resident when that person is present in the state for more than a temporary purpose. A person may also remain a resident while outside California if the absence is considered temporary.
The California residency audit manual directs investigators to examine objective facts and to compare connections both within and outside the state. Stated intentions alone do not control the decision.
Auditors can review where a taxpayer owns homes, where a spouse and children live, and where children attend school. They may compare time spent in each state and the purpose of those visits.
Financial activity can indicate where daily life is centered. Reviews may include bank accounts, card transactions, ATM withdrawals, and routine purchases.
Vehicle registrations, licenses, voter records, and club memberships can become evidence. Investigators may also examine professional services and business offices.
The manual even allows reviews of pet locations and related expenses. No single factor decides residency, and the agency must weigh the full circumstances of each case.
Three Moves Face Close Examination
Brin reportedly bought a home on the Nevada side of Lake Tahoe in December 2025. He later identified Nevada as his home state in a campaign finance filing.
Those steps could support his claim that he left California before Jan. 1. Auditors could still examine the location of his family, businesses, professional services, vehicles, and everyday spending.
Sacks reportedly moved to Austin, Texas, before the deadline. His public criticism of the tax would not, by itself, establish residency. The review would focus on whether Texas became his principal and lasting home.
Kalanick has said he moved to Austin on Dec. 18, 2025. That date falls two weeks before the cutoff, giving investigators a narrow period to examine changes in his housing, travel, financial activity, and business arrangements.
None of the three men has been accused of wrongdoing. Moving to reduce future tax exposure is not automatically illegal. The dispute would concern whether each person completed a genuine change of residence before the statutory date.
Billions Depend on Difficult Findings
The potential financial exposure is unusually large because the tax would apply to net worth rather than annual income. A 5% assessment on a fortune worth tens or hundreds of billions could produce a multibillion-dollar bill.
The state’s nonpartisan fiscal review found that the proposal could produce tens of billions in temporary revenue. It also warned that annual income-tax collections could decline by hundreds of millions of dollars or more if wealthy residents leave.
Private businesses and unique assets could create valuation disputes. Private companies, artwork, and intellectual property may require contested appraisals.
Those disagreements could continue after any residency ruling. Taxpayers may challenge property valuations, amounts assigned to California, and the measure’s constitutionality.
Campaign Divides State Leaders
The proposal is backed by a health care workers’ union seeking funds after federal reductions to public programs. Gov. Gavin Newsom opposes the measure, arguing that it could drive major taxpayers away from California.
A coalition of health care, education, and housing organizations also opposes the tax. Supporters say extreme wealth should provide emergency funding for medical care, schools, and food programs.
Brin has become a major financial force in the opposition campaign. He contributed $82 million to a committee supporting measures designed to weaken or block the tax, while the committee’s fundraising had already surpassed $118 million.
Competing ballot proposals could also affect enforcement. Legal challenges are expected if voters approve measures containing conflicting tax restrictions.
Proposition 40 remains only a proposal, and no billionaire currently owes money under it. The next formal decision comes on Nov. 3, when California voters will decide whether to authorize the tax and begin the residency, valuation and constitutional disputes likely to follow.
