#NovatoBroker
#NovatoBroker
  • Home
  • Explore Novato
    • Novato Intro
    • Novato Neighborhoods
    • Novato Elementary Schools
    • Novato Middle Schools
    • Novato High Schools
    • Novato Relocation Guide
    • Novato Monthly Update
    • Novato Historical Values
    • Get My House Value
  • Articles
    • Prop 19 Tax Transfers
    • 18 Home Prep Tips
    • 1031 Exchanges
    • Investment Analysis
    • Why Sell With Us
    • Why Buy With Us
  • Property Search
  • Testimonials
  • More
    • Home
    • Explore Novato
      • Novato Intro
      • Novato Neighborhoods
      • Novato Elementary Schools
      • Novato Middle Schools
      • Novato High Schools
      • Novato Relocation Guide
      • Novato Monthly Update
      • Novato Historical Values
      • Get My House Value
    • Articles
      • Prop 19 Tax Transfers
      • 18 Home Prep Tips
      • 1031 Exchanges
      • Investment Analysis
      • Why Sell With Us
      • Why Buy With Us
    • Property Search
    • Testimonials
  • Home
  • Explore Novato
    • Novato Intro
    • Novato Neighborhoods
    • Novato Elementary Schools
    • Novato Middle Schools
    • Novato High Schools
    • Novato Relocation Guide
    • Novato Monthly Update
    • Novato Historical Values
    • Get My House Value
  • Articles
    • Prop 19 Tax Transfers
    • 18 Home Prep Tips
    • 1031 Exchanges
    • Investment Analysis
    • Why Sell With Us
    • Why Buy With Us
  • Property Search
  • Testimonials

Prop 19 Property Tax Transfers

In November 2020 California voters passed Proposition 19. Here's what you need to know:

Proposition 19 allows statewide transfer of property taxes for those severely disabled or over 55. If you or your spouse are over 55 and planning to make a move within the State of California, there's some great new benefits. Effective April 1st. 2021:

  • Homeowners over 55 who are buying a less expensive home anywhere in the State can transfer their existing property tax to that new principal residence (example below*).
  • Homeowners over 55 who are buying a more expensive home can also save on their property tax bill by only paying the full property tax on the amount of the additional value in the new principal residence. For the portion of the property that is equal in value they can transfer their existing property tax.  Their property tax will go up but not by as much as it would for other homebuyers (example below*).
  • These special transfers can now be used up to three times (versus one transfer allowance under the old Proposition 60/90 rules) and the new purchase has to be within two years of the sale.


THE 4 STEPS OF THE TYPICAL PROCESS:

1 – Ask us to provide you with all the resources you need. We’ll email you all the necessary links from the California State Board of Equalization, the County Assessors Offices, and the required forms (links also provided below). Bottom line, before making a move, make a plan. We also encourage to consult with a qualified real estate attorney or tax advisor. 

2 – Sell your existing principal residence.

3 – Purchase a new principal residence within 2 years. 

4 – Within 3 years of purchasing the replacement property file Board of Equalization form BOE-60-AH with the county that your replacement property was purchased. Most people file the form much sooner than the 3 year limit so they can get the property tax rate adjusted ASAP. If you file within the 3 years, a retroactive adjustment will be made and you will be refunded any previous overpayment of taxes. You can file after the 3 year deadline, but then relief will only be granted beginning with the calendar year the claim was filed.


That’s it in a nutshell. An alternative strategy is to buy first and then sell your existing residence. That’s also common, just remember both transactions have to be within two years of each other. 

Feel free to email us directly and we’re happy to provide additional information adam@novatobroker.com


 

Resources and links:

Board of Equalization Prop 19 Info

https://www.boe.ca.gov/prop19/#Introduction

Marin Assessor Prop 60/90 Info and Forms

https://www.marincounty.org/depts/ar/divisions/assessor/exclusions/homeowners-55-or-older

San Francisco Assessor Prop 19 Info and Forms

https://www.sfassessor.org/tax-savings/tax-relief/transfer-assessment-replacement-property-senior-citizens#description


*Examples of transfers:

(1) Equal or Lesser Value: The replacement primary residence is of equal or lesser value, subject to an inflation index of 105% if purchased within one year of sale, and 110% if purchased within the second year of sale of the original property.  The tax basis of the original principal residence may transfer to the replacement principal residence. (for example, if you sell your existing principal residence for $1,000,000 you can purchase a property for up to $1,100,000 1-2 years after the sale date).

(2) Greater Value: The replacement residence is of greater value.  The taxable value of the replacement primary residence is calculated by adding the difference between the full cash value of the original primary residence and the full cash value of the replacement primary residence to the taxable value of the original primary residence. Example:

Original Primary Residence (OPR) taxable value . . .               $400,000

OPR sold for      . . . . . . . . . . . . . . .                                          $900,000

Replacement Primary Residence (RPP) purchase . . .            $1,000,000

Difference between sale price and purchase price is . . .         $100,000

Taxable Value of RPP is $400,000 plus $100,000…                $500,000


** Proposition 19 also addresses new rules regarding inherited properties not discussed in this article.


***This article is not intended as legal or tax advice. We encourage you to seek the advice of a qualified California real estate attorney or tax advisor prior to finalizing any decisions.

Covered patio leading to pool

Contact Us

Yes, I'd like more info on Prop 19...

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Adam Watts - Founder / Broker

926A Diablo Ave, Ste 347, Novato, CA 94947

415-287-6639 or adam@novatobroker.com

Copyright © 2024 Adam Watts - Real Estate Broker - Burdell Real Estate - DRE 01356839 - (415) 287-6639 - All Rights Reserved.