I just attended a great class at my KW office where Ira Belgrade, explained what is going on in LA. His company is YIMBYLA which stands for YES in my backyard! I will give you a little summary but please check out his website or give him a call. He is quite the expert and reasonably priced! Read Business Insider article here.
Whatever legal structure you already have, can be converted into an ADU unit. If you tear it down, you must a 5′ set back on the side and back. The state says 1200 sq ft max. Some municipalities have different rules than the state rules so you need an expert to cut through the red tape. I, personally, have a duplex so I was told that I could not add an ADU to my property 🙁
I will be handing his card to all my buyers that ask me if they can add a unit or convert a garage on their property. HIRE THE EXPERT.