Passage of Proposition 19

We are advising our clients and community of the significant ramifications Proposition 19 will have on real property owners in California, and planning opportunities that are available prior to the measure taking effect on February 16, 2021.

The passage of Proposition 19 (in November 2020) severely restricts the transferability of real property from parents to children without reassessment, a benefit currently allowed to property owners under Proposition 58. After February 15, 2021, nearly all transfers of real property between parents and children will result in some form of reassessment of the property’s taxable value to current fair market value. The only instances in which property transfers will not be affected involve transfers of the primary residence where the child intends to move in to the residence within one year and the property value is within certain parameters.

If your estate and/or business planning goals include the transfer of any real property to children with property tax savings, including long-term strategies for a primary residence, rental properties, investment properties, or commercial properties, we urge you to contact our office immediately to discuss the options available to you and your family. Such planning must be implemented before February 15, 2021.