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Proposition 19 – California 2020

Time to know how proposition 19 affects your estate planning gifting plans and family wishes!

The Pros and Cons of Proposition 19 – Now that it has passed on November 3, 2020, what can you expect from the new rules for tax assessment transfers?

Proposition 19 – Your Living Trust – And the Parent to Child Transfer of Real Estate Property

 

Proposition 19 - Parent Children Property Tax Transfers

Proposition 19 – Parent Children Property Tax Transfers

The Pros and Cons of Proposition 19 – Now that it has passed on November 3, 2020, what can you expect from the new rules for tax assessment transfers?

DOES PROPOSITION 19 AFFECT YOUR TRUST AND WILL AND GIFTING PROPERTIES TO YOUR FAMILY? (it’s all about the property taxes)

Proposition 19 is a double-edged sword. It changes a few things, especially property tax rules exempting certain intra-family transfers of real estate properties. 

How do you see it? And what you must do if you have properties in a Trust or Will!

If you are a homeowner, you know the California property tax is assessed based on the property’s purchase price plus any improvements to the property.  

So, on one side, it offers opportunities for the following:

  1. Home protection of seniors and severely disabled: Expand portability for proposition 13 regardless of the new purchase price. Can transfer their tax assessment from 1 to 3 times into any California county.
  2. Victims of a wildfire or natural disasters act:  Allocate additional revenue or net savings to wildfire agencies and counties. Permits homeowners who are over 55, severely disabled, or whose homes were destroyed by wildfire or disaster to transfer their primary residence’s property tax base value to a replacement residence of any value anywhere in the state.
  3. Family Farms:  Expands tax benefits for transfers of family farms.
  4. Housing Opportunities: Opens up tens of thousands of housing opportunities to make homes more readily available for first-time homeowners and Californians throughout the state.

On the other edge of the sword is eliminating the parent to child transfer of property while maintaining the parent’s property tax base. 

  1. Proposition 19 limits tax benefits for certain real estate property transfers between parent and child.

(quick note: A child has to move into the property as their primary residence to maintain the current tax base without reassessment based on the following:

WHERE DOES THE REVENUE FROM PROPOSITION 19 GO?

  • Schools and Local Governments:  Schools could gain tens of millions of property tax revenue per year.
  • Wildfire Prevention funds: Revenue from other taxes could increase by tens of millions of dollars per year for both the state and local governments.

PROJECTION:

Fire districts could receive up to $99 million in the first year and up to $6 billion over 12 years

VIEWPOINT FROM CALIFORNIA ASSOCIATION OF REALTORS:

VIEWPOINT FROM HJTA

About Hess-Verdon Trust Litigation Attorney Serving Orange County, California Families

Hess-Verdon & Associates is one of the most knowledgeable and most sophisticated trusts and estate law firm in California at both the trial and appellate levels.

Our legal team of Trust Attorneys in Orange County is well-versed in estate planning, trust administration, and trust litigation and can help you with any proposition 19 matters.

 Our viewpoint is the following: Aggressive legal representation with a team of experts that protect you, our preferred client, with current tax and estate planning strategies.

We welcome the opportunity to discuss your needs, qualifications, staffing approaches, and rate structures to resolve estate and trust-related matters successfully. 

NEED A SECOND OPINION?

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Proposition 19 California 2020

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Proposition 19 California 2020

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