Typically when a home is transferred from one person to another, property taxes are reassessed on the home at it’s current market value. Having a property’s value reassessed can cost the new owner thousands of dollars a year in property taxes. California Proposition 19 allows for a parent to transfer a property to a child while avoiding property tax reassessment under the following conditions:
- Property was the primary residence of the parent (owner-occupied)
- Property will be the primary residence of the child (owner-occupied)
- The current assessed value plus $1,022,600 (increased from $1,000,000 on 2/16/2023) will be the maximum benefit and may be transferred without a change in property taxes. Any amount over this will be added to the assessed value and taxed at the normal rate.
Additionally, Proposition 19 allows for the transfer from a grandparent to a grandchild providing there is no living parent of the grandchild. This Proposition 19 Parent to Child Transfer Benefit Calculator will help you determine how much you may be able to save by avoiding property tax reassessment on an inherited home.