Tax Changes

As I mentioned last week, Proposition 19 passed last month. Below is a reprint of a handout from the California Association of Realtors summarizing the changes:

 

“New Rules on Tax Basis Portability. With the passage of Proposition 19, a homeowner who is over 55 years of age, severely disabled or whose home has been substantially damaged by wildfire or natural disaster may transfer the taxable value of their primary residence to: 1. A replacement primary residence. 2. Anywhere in the state. 3. Regardless of the value of the replacement primary residence (with adjustments if "greater" in value). 4. Within two years of the sale. 5. Up to three times (but without limitation for those whose houses were destroyed by fire).

 

Proposition 19 will supersede the old rules which limited this exemption to the sale and purchase of a principal residence within the same county (Proposition 60) or between certain counties (Proposition 90) -- but only if the replacement property was of "equal or lesser value" and only one time.

 

Purchases and Sales Before April 1, 2021. Although we believe that the tax benefits under Proposition 19 apply to transactions where either the sale or purchase of a primary residence takes place before April 1, 2021, as long as the subsequent sale or purchase takes place within two years and on or after April 1, 2021, others have taken the position that both the sale and purchase must occur on or after April 1st, 2021. […]

 

Nonetheless, owners of real property that qualify under Proposition 60 or 90 can still take advantage of those features until April 1, 2021. (If an owner never took advantage of these and were qualified, they might be able to get a refund of taxes already paid.)”

 

THIS IS NOT LEGAL ADVICE. CHECK WITH AN ATTORNEY FOR SPECIFICS TO YOUR SITUATION.

 

If you have questions about real estate, call me at (925) 240-MOVE (6683). Voted “Best of Brentwood” multiple times. To search the MLS for free, go to: www.SharpHomesOnline.com. Sharp Realty. #01245186

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