Prop 60 and Prop 90 allow home sellers to transfer their old tax base (property taxes) to a new home they purchase (resale or new construction). Many rules and restrictions apply. It starts with being 55 years of age or older at the time the downleg property is sold and closes escrow. The rules are here below but feel free to me so we can discuss your individual situation. Some advanced planning is very important. I would be remiss if I did not recommend that you always include your estate and trust attorney and your CPA to be involved in this planning. Contact me for the right folks to be able to help you specifically with those needs if you have not begun estate planning already. I can help find the right person for your needs whether you are in your 30's, 40's, 60's, 70's, or even 80's. In regards to your estate planning: Whether you own your own home or a myriad of real estate investments, you must always plan ahead when it comes to the disposition of that wealth down the road. Life insurance, a will, an executor, trusts, and even how to hold title for the best tax benefits must be taken care of. A little advanced planning can make a big difference. Call me to get in touch with the right professionals. The information contained on this site in regards to tax and estate planning is not complete and should not be construed as tax or legal advice. You should always consult the appropriate licensed professional CPA or Attorney for a complete analysis of your needs.

Further Information Below Concerning:

Proposition 60 : Intra county tax base transfer
Proposition 90 : Inter county tax base transfer
Porposition 58 : Parent-child property transfer

Proposition 60

Proposition 60 allows homeowners 55 years of age and older to transfer the base year value of their principal residence to a newly purchased residence in the same county, providing that certain requirements are met.

The requirements, in part, for this exclusion include the following:

• The replacement residence must be purchased or newly constructed within two years (before or after) of the sale of the original residence. The purchase or new construction of the replacement dwelling must include the purchase of that portion of land on which the replacement dwelling will be situated.
• The principle claimant or the claimant's spouse who resides with the claimant must be at least 55 years of age at the time the original residence was sold. The claimant must be an owner of record of both the original and replacement residences.
• The sale of the original residence must qualify for reassessment under the provisions of California Revenue and Taxation Code Section 110.1.
• The principle claimant must have been either:
  1. Receiving, or eligible for, a Homeowner's Exemption, or
  2. Receiving a Disabled Veteran's Exemption on the original and replacement residences.
• The replacement residence must be equal to or lesser in value than the original residence. "Equal to or lesser in value" has been defined as: 100 percent of the market value of the original property as of its date of sale if the replacement dwelling is purchased before the original property is sold; 105 percent of the market value of the original property as of its date of sale if the replacement dwelling is purchased within one year after the original property is sold; or 110 percent of the market value of the original property as of its date of sale if the replacement dwelling is purchased between one and two years after the original property is sold.
• Special rules apply to multi-unit dwellings and mobile homes.
• Relief pursuant to Section 69.5 (Proposition 60 and 90) of the Revenue and Taxation Code can be granted only once, except for certain circumstances regarding severely and permanently disabled persons as defined in Revenue and Taxation Code Section 74.3.
• Claims must be filed within three years of the date the replacement residence is purchased or newly constructed. You must complete the claim form and provide evidence and/or declare under penalty of perjury that you are at least 55 years of age. Application forms may be obtained by contacting the Real Property Division of the Santa Clara County Assessor's Office at the number below.

Proposition 90

Proposition 90 allows a homeowner to transfer the base year value of their principal residence in one county to a newly purchased residence in another county providing that certain requirements are met. Only a limited number of counties are participating in Proposition 90.

Proposition 90 Requirements: (San Diego County)

• The requirements for Proposition 90 in San Diego County are the same as for Proposition 60 except for the following:  

1.  Effective date: November 9, 1988. 
2.  A non-refundable processing fee of $60 is required. 

• The effective dates and filing fees vary from county to county. Those property owners interested in transferring the base year value from their principal residence located in San Diego County to a newly purchased residence in another county should call that county to make sure that the other county is participating in Proposition 90.
• Applications must be filed in the county where the newly purchased residence is located.
• The following is a list of those counties which have approved Proposition 90 and will currently accept base year value transfers from other counties.

Proposition 58

Parent-Child Transfers (R&T Section 63.1)

The Basics   FAQ

• Real estate that is transferred from parent(s) to child(ren), or from child(ren) to parent(s) may be excluded from reassessment.
• The established Prop. 13 taxable value is not affected by the transfer
• Exclusion is not automatic; there must be a timely filed claim with the Assessor's Office
• The new owner's taxes are calculated on the established Prop.13 factored value, instead of the current market value when the property is acquired.
• $1 million limit (taxable value) on transfers of non-principal residence property
• No dollar limitation on the original owner's principal residence
• Transfers between legal entities (i.e., corporations, partnerships) that are owned by parents or children do not qualify

The parent-child transfers under Proposition 58 include all types of transfers of title from parents to children or from children to parents. Transfers must occur on or after November 6, 1986, the effective date of the Proposition. They may be in the form of a deed (recorded after November 6, 1986), an inheritance from someone who was deceased after November 6, 1986, a court order dated on or after that date, etc.

Further, this Proposition includes all types of real property owned by the transferor, including all the value of his/her principal place of residence and on the first one million dollars ($1 million) of the enrolled value of all other types of property. A mother and father can combine their exclusion for a limit of $2 million dollars.

Definitions and Terminology specific to Prop 58

Children: Children include the following: sons and daughters, sons-in-law and daughters-in-law, stepchildren, and children adopted under 18.

Gift/Purchase: Transfers such as a gift or purchase between parents and children are excluded with a completed Prop. 58 form.

Principal Residence: Proposition 58 does not require that the parent or child use the transferred property as his or her principal residence. In addition, the $1 million limit does not apply to the transferor's principal residence.

$1 Million Dollar Exclusion: The $1 million exclusion for other property applies for each transferor. Therefore, a mother can transfer $1 million of other property and a father can transfer $1 million of other property for a total combined exclusion of $2 million. These transfers will be coordinated Statewide under the million dollar limit.

Legal Entities: Transfers directly between legal entities owned by parents and children are not entitled to the benefits of this measure.

Trusts: A transfer to or from a trust is treated just as a transfer to or from the trustor personally, provided the trust is revocable.

Date of Death of Decedent: The date of any transfer between parents and their children under a will or intestate succession is the date of a decedent's death, which must be after November 6, 1986.

"Third Party" Defined: A third party is any person or entity that is not a transferee or transferor in the transfer between the parents and children.

"Transfer of the Real Property to a "Third Party": For filing proposes, a transfer of the real property to a third party occurs when all the real property received is transferred to someone other than an original transferee or transferor. Therefore, a transfer may qualify for an exclusion when a partial interest in the property received is transferred to a third party prior to an application being filed.

Filing Requirements:

Current law requires that the claim form be filed within three (3) years after the date of the transfer of real property or prior to the transfer of the real property to a third party, whichever is earlier. However, even if a claim is not made within this filing period, a claim is considered timely if it is filed within anytime prior to or within six (6) months after the mailing date of a Notice of Supplemental Assessment or Notice of Proposed Escape Assessment, whichever is later. For example if a taxpayer received a Notice of Supplemental Assessment for a parent-child transfer dated January 1, 1994, and then received a Notice of Proposed Escape Assessment dated April 1, 1994, the taxpayer would have six (6) months from April 1, 1994 to file a claim with the Assessor.

1997 Amendment To Filing Requirements

Effective January 1, 1998, in general, except where the property has already transferred to a third party, a Proposition 58 application will be allowed at any time the claim is filed after the conclusion of the above filing periods. (An exception to this rule is when a Proposition 58 application filing results in an escape or supplemental assessment and a third-party transfer has occurred.)

However, under these provisions, the first year of relief begins the year in which the claim is filed; there will be no refund for previous years. Therefore, the first year's enrolled value would be the base year value as of the year of transfer, factored for inflation plus any additional value which has been enrolled because of subsequent transfers or new construction.

TIPS ON COMPLETING THE PROP 58 CLAIM FORM (BOE-58-AH)

Section A - Property

• The Assessor's Parcel Number and Recorder's Document Number can be obtained from the cover letter sent with this form. In transfers resulting from a death, the cover letter may reference a pseudo number. E.g. P0001234. Write that number in as a document number.
• The Questions in the last line only apply to transfers involving a death of the former onwner. If it doesn't apply, leave blank.

Section B - Transferor(s) (There is space on the back for more names.)

• The transferor is the person giving interest to the child or parent, the seller, the grantor, the person being removed from the title OR the decedent in transfers resulting from death.
• All questions in this section are directed to the transferor.
• Question No. 2 - The Social Security Number of the transferor is required.
• Question Number 4 is asking if the transferor lived in the property (or still does). Also, if you know of an exemption being claimed on this property, please check the appropriate line.
• Question No. 5 is asking if the transferor is transferring property that they do not live in. If the answer is yes and the transferor has done a parent/child transfer before, please attach a list of addresses of all previous transfers.
• Question No. 6 is asking if the transferor is transferring only a portion of their interest. If yes, list the percent being transferred.
• Question No.7 is asking was the transferor was a joint tenant with someone else. If you don't know, leave blank.
• Question No.8 - If this property is/was in a trust, please list the beneficiaries of the trust.
• Up to two transferors can sign at the bottom on the front page. Please include date signed, mailing address and telephone number.

ALL TRANSFERORS OR THEIR LEGAL REPRESENTATIVES MUST SIGN THE CLAIM FORM

Section C - Transferee(s) (There is space at the bottom for more names.)

• The transferee(s) is the person receiving interest from the transferor.
• Question 1 - Enter the name(s) of the transferees. You are able to list up to two names on this line. One transferee must sign the certification below question 3.
• Question 2 - List the relationship to the transferor. (son, daughter, mother, father, step-son, step-daughter, step-mother, step-father)

Please read the additional questions for No. 2. If any of the situations listed apply to this transfer, please check the
appropriate box. If not, leave blank.

Please include the date signed, mailing address and daytime telephone number.

ONLY ONE TRANSFEREE OR THEIR LEGAL REPRESENTATIVE MUST SIGN THE CLAIM FORM.