• calendar_month August 6, 2024
• folder Tips

If you're a homeowner in California, you may have heard about Proposition 19. This proposition, which passed in November 2020, offers several significant benefits for homeowners, particularly those aged 55 or older, people with severe disabilities, and victims of natural disasters. Understanding these benefits can help you make the most of your property investments and provide financial flexibility when you need it most.

What is Proposition 19?

Proposition 19 allows eligible homeowners to transfer their property tax base to a new home anywhere in California. This proposition is particularly advantageous for older homeowners, those with disabilities, and those affected by wildfires or other natural disasters. Here are some of the key benefits:

1. Property Tax Portability for Seniors and Disabled Homeowners

Under Proposition 19, homeowners aged 55 or older and those with severe disabilities can transfer their existing property tax base to a new home up to three times. This transfer can occur anywhere in the state and applies to homes of equal or lesser value. This means that if you downsize or move to a different county, you can maintain your current property tax rate, potentially saving thousands of dollars annually.

2. Tax Relief for Victims of Natural Disasters

If your home has been substantially damaged or destroyed by wildfire or another natural disaster, Proposition 19 allows you to transfer your property tax base to a replacement home. This benefit provides financial relief and helps affected homeowners rebuild their lives without facing a significant increase in property taxes.

3. Inherited Property Tax Changes

Proposition 19 also changes the way inherited properties are taxed. Previously, children or grandchildren could inherit a property and retain the original property tax base, regardless of its value or use. Now, the inherited property must be used as a primary residence or a family farm to qualify for the lower tax base. Additionally, the tax benefit is capped, and any value above the cap will be reassessed at market value. This change ensures that tax benefits are preserved for family homes while preventing potential abuses of the system.

4. Increased Revenue for Local Governments and Fire Protection

By closing loopholes in the inheritance tax rules, Proposition 19 is expected to generate additional revenue for local governments and fire protection services. This additional funding can help improve community services and enhance public safety, benefiting all Californians.

Why Now is a Great Time to Consider Your Options

With the real estate market currently experiencing high activity and interest rates remaining relatively low, now is an excellent time to explore your options under Proposition 19. Whether you're looking to downsize, move closer to family, or rebuild after a disaster, the benefits of Proposition 19 can make your transition smoother and more financially manageable.

How We Can Help

At JohnHart Real Estate, we are committed to helping you navigate the complexities of Proposition 19 and make informed decisions about your property. Our team of experienced professionals is here to assist you with all your real estate needs, from understanding the details of the proposition to finding your next home.

If you have any questions or would like to discuss how Proposition 19 can benefit you, please don't hesitate to contact us at 818-534-7376. Let's explore your options and make the most of your property investments together.