One of the biggest advantages of owning a home in California is Proposition 13. This limits how much your property taxes can go up each year. Many long-time homeowners are paying property taxes based on an assessed value that is often well below the current market value of their home. Giving up this tax advantage can make it tough to move in retirement.
How to transfer California property tax from the old home to new.
By David Rae Certified Financial Planner™, Accredited Investment Fiduciary™
Today we will answer the following question about Transferring Property Tax in California:
“I’m over 55 and have owned my home, in Southern California, for decades. I’m looking to move to another home for my retirement. Will I be able to transfer my property tax base from my old home to my new home?”
The short answer is, as it almost always is, “it depends.” Here is some additional information to help you figure out if you will be able to transfer your low base to a new home, in California.
Transfer California Property Tax for Homeowners 55 and over.
California homeowners 55 and older can get a one-time opportunity to sell their primary residence and transfer the property tax assessment to a new home under Proposition 60. The caveat here is the market value of the new house generally must be lower or equal to the home being sold. For married couples, only one spouse must be 55 or older.
This regulation was designed to help longtime homeowners, in California, who wanted to downsize in retirement and avoid having to give up their lower property tax assessments. I work with many clients who live in homes that are worth well north of 10 times what they paid for it. With sky-high real estate values in much of California, the tax savings here could be huge. For can be the difference between staying in your home or being forced to move.
Under the aforementioned Proposition 13, homes are only reassessed for property taxes when a change in ownership occurs or there is new construction. If neither of those actions occurred, the assessed tax base can only go up by an inflation rate not to exceed two percent, per year. On a side note, homeowners can also get a temporary tax reduction when their property values decrease. Real estate does go down in value here in California, as much as people like to claim it doesn’t.
With real estate values near record highs in much of California, most homeowners would face large property tax increases if they were to buy their homes again today. They would likely even see tax increases if they were to downsize to a cheaper home.
Related: 6 Ways to Reduce Your Tax Fraud Risk
Proposition 60 gives homeowners a way to move or downsize without greatly increasing their tax bills. It’s important to note that there are restrictions in order to receive this generous benefit. Restrictions include the following:
- You must be 55 or older to transfer your current tax base to a new primary residence.
- The new home must also be in the same county as your current one. However, Proposition 90 allows for transfers of base-year values but only between the counties of Los Angeles, Orange, San Diego, San Mateo, Alameda, El Dorado, Santa Clara, and Ventura. These are subject to change so make sure to check with your assessor before buying or selling a home.
- The new home must have been purchased within two years before or after the sale of the original, low-tax based property. The before or after the portion of this will make it easier to account for when downsizing in retirement. Keep in mind issues could arise if new and old homes are close in value. If the old home experiences a decrease in value and sells later, your new home may not meet the equal or lesser value requirement.
Can I Transfer the California Property Tax base if I buy sell my old home then buy a new one?
There is a little added cushion for those who are buying their new homes, after selling their current homes, and who wish to transfer the tax base. If the new home was purchased within one year of selling the former home, the new home must be 105%, or less, than the value of the former home. If the new home was purchased between one and two years after selling the former home, the new home must be less than 110% of the former home’s sale price. Be aware of these deadlines when shopping for your dream home in retirement.
There is a lot of confusion and misinformation about this tax break. This is something people can do once in their lifetime. Therefore not many of your friends are likely to have gone through this. Also, the requirement to stay in the same county also deters some potential homeowners from benefiting from Proposition 60.
Proposition 60 and Proposition 90 – The fine print how to Transfer California Property Tax Base
According to the Los Angeles County Office of the Assessor website, a claim must be filed within three years of purchasing or completing the new construction of the replacement property. If a claim is filed after the three-year period, relief will be granted beginning with the calendar year in which the claim was filed.
If this is something that could potentially benefit you, apply to the Los Angeles County Office of the Assessor for a “Claim of Base Year Value Transfer.” Keep in mind that just because your old home sold for $2.5 million dollars and your new home was $2.45 million, that doesn’t mean you will automatically have your application approved. The assessor can challenge whether the sales price equals the market value.
If you sell your old home and throw in furniture, or other items, your value may be challenged. This can extend to things that are often included in a home sale like washers, dryers or above-ground spas. If your new home’s value exceeds the old home’s price, by even one cent, you will lose out completely on the benefits of Proposition 60. Make a note in your sales contract of the value being assigned to the personal property that’s being included with the sale of the home.
Los Angeles County residents can visit the assessor’s website for more information. With Transfer California Property Tax being so valuable you want to dot your I’s and cross your T’s.
I would love to hear from anyone who has taken advantage of transferring their lower tax base. Or if you have been turned down attempting to use Prop 60 or 90. Properly using these laws could be the difference between a secure retirement in California or struggling to get by. Or even just being stuck in a home where you can’t get up or down the stairs.
Guidance with our transferring property taxes is part of our financial planning for California Retirees here at DRM Wealth Management. If you would like to see if it would be a good fit to be one of our clients, please reach out.
Live for Today, Plan for a Richer Tomorrow. Transfer California Property Tax Base could save you a ton of taxes in retirement. For more proactive and hands-on Financial Planning guidance reach out to Financial Planner LA David Rae to see if it might be a great fit to work together.
DAVID RAE, CFP®, AIF® is a Los Angeles Certified Financial Planner with DRM Wealth Management. A regular contributor to Advocate Magazine, Forbes.com, Investopedia not to mention numerous TV appearances. He helps friends of the LGBT Community across the USA get on track for their financial goals. For more information visit his website at www.davidraefp.com
If you enjoyed Transfer California Property Tax Base you may also like:
Is My Los Angles Home Equity Line Still Deductible? HELOC Tax Deduction
Connect With David Rae, Financial Planner LA
David Rae, CFP® AIF®
President / Founder DRM Wealth Management LLC
1(323) 905-4380
david.rae@financialplannerla.com
I have a question about this. Suppose I’ve just turned 55, and I’m about to sell my old home and wish to transfer the tax to a new home I bought over a year ago, before I was 55. Does the provision require both the purchase and the sale to happen after I’m 55, or just to the sale of my old home?
Can I transfer my tax base and also do a 1031 exchange on the same property? Is the transfer of a tax base allowed only 1 time per lifetime?
Can I transfer the California property tax. If I sell and buy. Riverside County.
I’m 84 years old, now living in Salinas California,Monterrey County. I’m selling my house here and buying one in San Diego close to my daughter. Can I transfer the property tax to the new home? Thanks!
my mom just sold house in santa clara ca. she is disabled and over 55 years old, and purchased new house in stockton ca. Will she be able to transfer prop 13 property tax rate?
Please contact me regarding transferring my Proposition 13 to condo I just purchased to be able to use Proposition 60. I meet all requirements
Thank you
I’m planning to sell my house in LA county and buy in Long Beach. I meet al other criteria. Can I transfer my existing tax base?
I have heard that if your purchase price is 5% over your sale price you can still transfer your property tax base to the purchase property. Is this true?
I see you don’t monetize financialplannerla.com,
don’t waste your traffic, you can earn extra cash every month with new monetization method.
This is the best adsense alternative for any type of website (they approve all websites),
for more details simply search in gooogle: murgrabia’s
tools
I had prop 13 on house just sold. New purchase follows all criteria for transferring prop 13 to prop 60 on new purchase. However, tax assessors office sent a letter telling me I do not qualify for prop 60. Please advise
Thank you – M. E. Chacon
I am 71 and live in Santa Cruz county. I have lived here for 40 plus years . We are planning to move to Calaveras County can I transfer my property taxes
[…] Download Plan More @ https://www.financialplannerla.com […]
I’m wondering if there is any way to sell my home and buy a home that is of higher value and still keep my current tax bracket? My home is appraised at 1.3 mil and seems every house I’m attracted to in town is 1.7 mil. My home is typically larger and on 2 acres so clearly equal value is subjective. Could I get a prorated tax on the $400 k difference? Rather than the entire amount of $1.7mil?
I sent my request for transfer of my tax base from Orange County to Los Angeles County 9 months ago. I know that they have received the request because the one time in ten calls I got hold of someone who said it has been assigned to a person. I was given that person’s name and phone number. I have tried calling that person and left messages to call me. No call back. I got hold of another person who said call these two people who know about transfers. I have left numerous messages identifying my self and parcel number and No Call back. It is going on 10 months and soon my next property tax will come due. What a failed government office.
[…] Assuming all the thing she was worried about happening, she still has the equity in the home to fall back on. Her goal is to stay there, and not have to touch the equity, but I think there is value in knowing that she has the pool of money to tap into if she needs to. Plus, owning the home (beyond maintenance), she controls her housing costs. Her mortgage payment will go away in a few years, and property tax increases are regulated in California, thanks to Prop 13. […]
I sold my house when over 55 years old that I owned by my self ,can I add my spouse ‘s name in the title on a new replacement house, but she is under 55 years old ,does proposition 60/90 allow me to do it
I sold my home in San Mateo county 10/2018 and purchased a townhome in Alameda county on 11/2018, carrying my low tax base. If I were to sell again and purchase a home of a greater value in Alameda county, could I carry that tax base or would I assume the current taxes of the new purchase or would there be a new assessment based on my purchase price.
I just had a terrible thought. regarding my taxe rate. I and 74 and want to take my current tax rate with me to the new property under prop 90 but it just occurred to me that there may be a problem with the name on title. Back in November I had a living trust created which changed the house title to the trust and not directly in our (I and my spouse) names. We our the only ones who own the trust and , ergo, own the house and our free to sell it.
Will Riverside accept the tax transfer when our current property is named in a trust and not directly in our names (the last OC current tax bill is still in my name)?
Should I remove title from the trust and return the title back to our names before we close a sale?
Should we buy the new property in the name of the trust rather than in our names?
Originally, we were advised to place the house in the trust as it makes the transfer of out assets easier in the event of our demise. We thought that we would simply buy the new property and transfer the OC tax rate to the Riverside property. Later, we would transfer the new property to the trust. Now, I fear that by having the property title in the name of the trust will block the transfer our OC tax rate to Riverside.
So should I return the title to our names or should I make sure that our offer to buy the Riverside property is in the name of the trust rather than our names? What should we do as time as short? Does your service handle such matters?
I’m afraid to ask what you would charge I’m afraid I can’t afford you I live in Orange County I received home my living trust for my parents in 2001 at the time of their death this house was high 305- 310. I had plans and moving to Idaho properties are selling 40 and $50,000 more than asking much like it is here in California I’m getting offers over 800,000 and it’ll sell for more I’m disabled 62 years old I physically cannot manage my parents home anymore I’m price out in Idaho. Where do I go in California I cannot put every cent that I walk away with into a home I’m going to be facing capital gains anything over the $250,000 credit what’s 100000 in upgrades and repairs in this house how do I take the Prop 13 pay cash for a smaller cheaper home in California somewhere and still have money left in the bank to survive because nobody’s going to likely hire me 37 years of my profession I can no longer do!!
[…] market is weak at the moment), or if you have low property tax base (thanks to Prop 13, and want to transfer that tax base to a new home in the future – you need to be at least 55 to do this in […]
Great article. Do you know if you will be disqualified if one purchases a home in a different state but within 2 years of the sale of their CA home returns to CA and purchases in CA. Will they still quality for prop 60? Thank you!!
I sold home to friend 780 in Alameda county. I married now and with those funds we are buying a home in Truckee,Ca. She also owns home in Sacramento county. We will be living at both places. I know I am not moving to same county . Is there anything I can do to avoid the property tax break. My property taxes are going to be huge if I can’t take adv of prop 60 or 90
Newman Ng
i want to give my house as gift to my son 21 years and buy a condo can i transfer the property tax from my old house to my condo
[…] Angeles property tax roll will be assessed on the new value of $1.76 trillion. Without the help of Prop 13, Prop 19, and Prop 60, which help limit increases in assessed values and property taxes in California, this property tax roll number could be even […]
[…] roll will probably be assessed on the brand new worth of $1.76 trillion. With out the assistance of Prop 13, Prop 19, and Prop 60, which assist restrict will increase in assessed values and property taxes in California, this property tax roll quantity could possibly be even […]
[…] Angeles property tax roll will be assessed on the new value of $1.76 trillion. Without the help of Prop 13, Prop 19, and Prop 60, which help limit increases in assessed values and property taxes in California, this property tax roll number could be even […]
[…] Angeles property tax roll will be assessed on the new value of $1.76 trillion. Without the help of Prop 13, Prop 19, and Prop 60, which help limit increases in assessed values and property taxes in California, this property tax roll number could be even […]
[…] Angeles property tax roll will be assessed on the new value of $1.76 trillion. Without the help of Prop 13, Prop 19, and Prop 60, which help limit increases in assessed values and property taxes in California, this property tax roll number could be even […]
[…] Angeles property tax roll will be assessed on the new value of $1.76 trillion. Without the help of Prop 13, Prop 19, and Prop 60, which help limit increases in assessed values and property taxes in California, this property tax roll number could be even […]
[…] Angeles property tax roll will be assessed on the new value of $1.76 trillion. Without the help of Prop 13, Prop 19, and Prop 60, which help limit increases in assessed values and property taxes in California, this property tax roll number could be even […]
[…] Angeles property tax roll will be assessed on the new value of $1.76 trillion. Without the help of Prop 13, Prop 19, and Prop 60, which help limit increases in assessed values and property taxes in California, this property tax roll number could be even […]
[…] property tax list will be evaluated on the new value of $ 1.76 trillion. Without the help of Prop 13, Prop 19 and Prop 60, which help limit increases in appraised values and property taxes in California, this property tax registration number could be even […]
Can you help with transfer questions?
I sold my house in Lake Arrowhead CA in November 2019. Bought a new house in Indio CA In January of 2020. I would like to transfer my tax base to the Indio house.
If I reside in Riverside county , from a current historic property under the Mills Act
And acquired a property in Orange County, what could I expect as for tax transfer under prop 60/90
I’m 72 years old and a disabled Veteran, I’ve owned my home in Pebble Beach since1992 under Prop 13 tax rules. I’ve been a full time resident for 3 of the last five years, Other years, from time to time, I rented my home but maintained 25% residency. Recently due to Covid 19 and family health health issues, I was forced to sell my home on a 1031 exchange. I must identify a new home by December 20th. Problem is I’m told I’m can’t live in it. My other issue is about my Prop. 13 tax base. Can you tell me if I am eligible to transfer my old tax base to the new property if I remain in Monterey County?
[…] terms of low taxes. The state is 30th in terms of property taxes. With the tax savings benefits of Prop 13, relative to property values, the property tax burden in California is much more competitive than its ranking would imply. […]
[…] terms of low taxes. The state is 30th in terms of property taxes. With the tax savings benefits of Prop 13, relative to property values, the property tax burden in California is much more competitive than its ranking would imply. […]
[…] terms of low taxes. The state is 30th in terms of property taxes. With the tax savings benefits of Prop 13, relative to property values, the property tax burden in California is much more competitive than its ranking would imply. […]
[…] terms of low taxes. The state is 30th in terms of property taxes. With the tax savings benefits of Prop 13, relative to property values, the property tax burden in California is much more competitive than its ranking would imply. […]
[…] terms of low taxes. The state is 30th in terms of property taxes. With the tax savings benefits of Prop 13, relative to property values, the property tax burden in California is much more competitive than its ranking would imply. […]
[…] low taxes. The state is 30th by way of property taxes. With the tax financial savings advantages of Prop 13, relative to property values, the property tax burden in California is way more aggressive than its rating would indicate. […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California householders, you’re doubtless paying property taxes at a below-market price (due to Prop 13). In circumstances like this, the longer you could have owned the house, the extra vital this […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California householders, you’re doubtless paying property taxes at a below-market price (because of Prop 13). In instances like this, the longer you could have owned the house, the extra vital this profit […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
[…] California homeowners, you are likely paying property taxes at a below-market rate (thanks to Prop 13). In cases like this, the longer you have owned the home, the more significant this benefit could […]
Can I transfer property taxes from my old home to my new one. Sold in long beach ca bought in wildomsr ca san diego.
If i own a house in another county (San Luis Obispo) which is a rental now and i move in, may i bring my tax base with me from Orange county?
I have owned and lived in a commercial warehouse which has a NY style loft built within it on the mezzanine level. This has been my residence since 2015. I am planning to sell the property and purchase a house (within the same county). If I sell the warehouse for $4,000,000 and buy a house for one dollar less than the final sales price of the warehouse, can I transfer the the warehouse tax base?
I inherited my parent’s home in Ca 8 years ago. I am 78 years old. Would I be able to transfer this inherited property tax rate advantage if I buy a similar valued home in another location in Ca.?