According to a survey by the California Association of Realtors, one of the top reasons home owners have not considered selling is a concern that property taxes on another home would be too expensive.
For certain groups of people living in San Diego County and some other counties in California, there is a way to move but not increase property taxes.
California voters have passed several propositions, Propositions 60, 90 and 110, that allow eligible property owners to transfer the base year value of an existing principal residence to a replacement dwelling.
What do these propositions do? Who qualifies, and what are the benefits?
Tax Saving Benefits
Props 60, 90 and 110 allow a homeowner to transfer the existing base year value of their current, owner occupied home to a replacement dwelling. This means if you qualify, you can sell your home and buy a new one, but still pay the same property taxes you were paying for the home you sold.
If you’ve lived in the same home for any period of time, this could save you quite a bit of money.
Proposition 60 requires the following:
- You or your spouse must be at least 55 years of age when you sell your original property.
- You can do this only once unless you become severely and permanently disabled after the date of your original claim and have to move because of your disability. (See Proposition 110 below.)
- The new property must be of equal or lesser value than the original property.
- The new property must be purchased or built within two years before or after the sale of the original home.
- Both the original home and the new home must be your principal residences.
- The original property and new property must be located within the same county. (If you’re moving to a different county, see Proposition 90 below.)
For more information on qualifying for the Proposition 60 reassessment exclusion, see these California State Board of Equalization Frequently Asked Questions.
You do not have to be 55 or older to qualify for Proposition 110. It requires that you or your spouse residing with you must be severely and permanently disabled.
The rules are similar to those of Proposition 60, but the disabled person must submit a Physician’s Certificate of Disability with their claim. Both the original and replacement property must be owner occupied or eligible for the disabled veterans’ exemption, and the new home must be your principal residence.
To find out more about Proposition 110 and whether you qualify, go to the California State Board of Equalization frequently asked questions page for Proposition 110.
Proposition 90 allows you to take advantage of Propositions 60 or 110 if you are moving to a different county in California as long as that county has adopted an ordinance accepting transfers from other counties. San Diego County is currently one of the counties that allows an intercounty transfer.
These ten California counties allow intercounty tax base value transfers as of November 20, 2014:
Check with your county to verify eligibility as this list is subject to change.
Need More Information?
If you’d like to move but not increase your property taxes, and still have questions about whether you’d qualify, the California State Board of Equalization has a wealth of information for you. Take a look at their Letters to Assessors. Here you’ll find answers to questions regarding age and disability, ownership and trusts, how and when to file your claim, types of property that qualify, timing, and much more. You can also call their Assessment Services Unit at 916-274-3350.