There are a few important things to know about the recently passed Prop 19. Let me fill you in.
The state of California recently passed Proposition 19, which has had a wide-ranging impact on many throughout the state. I’ll explain everything you need to know about it today. First, to understand Prop 19, you need to understand Prop 13.
Proposition 13 was originally voted into law in 1978. With it, the state of California allowed you to keep your property tax basis at 1% of the purchase price. If you were 55 years or older, this means you could buy another property at the same price or less and keep that same bracket. However, you could only transfer that tax basis within just 10 counties in the state of California.
Proposition 19 now allows homeowners aged 55 or older to transfer their property tax basis to anywhere in the state of California. The price doesn’t matter, either. You’ll still be able to transfer your original tax basis with you and purchase a more expensive property with it.
With Prop 13, you could inherit the tax basis. Proposition 19 doesn’t allow you to do that unless you decide to make the property a primary residence. You can’t keep it with that same basis as a rental or investment property either.
“You can now transfer the tax basis
anywhere in California.”
If you or someone you know is thinking of taking advantage of this new state law or have any questions about real estate in general, don’t hesitate to reach out via phone or email. I look forward to hearing from you soon.