It’s no surprise to anyone in California that if commercial property owners, landlords, business and industrial facility owners ever have their property taxes increased by any tax measure like Prop 15 – rents will go up for business tenants and apt. dwellers. Most goods and services in the state will go up, increasing the cost of living and negatively impacting 40 million consumers in the state of California. Companies that can’t abide higher taxes will soon leave California, to more empathetic states, and they will take their jobs with them. If Proposition 15 ever returns, or comes back with another name, with more deceptively effective marketing. It is indeed a mystery as to why the Legislature in California would want to impact the entire state in this fashion. They claim it’s to fund the school system. According to Jon Coupal at the Taxpayers Association and other analysts and state economists, this is merely a thinly disguised ruse to pay for a few hundred unfunded local government staff pensions. Either way… is it worth it, to impact 40 million Californians this way?
It appears that Proposition 19 will now become tax law in California. Removing the so-called parent to child exemption, also called parent to child exclusion or parent to child transfer; destroys a critical property tax relief benefit from homeowners… No longer allowing residential property owners to avoid property tax reassessment every year – which effectively destroys property tax relief in the state of California.
Another related process that may well be affected by Proposition 19 are trust loans, used in conjunction with Proposition 58. These days, called intra-family loans to trusts to minimize property taxes, with one small, successful boutique firm in Newport Beach, Commercial Loan Corp, opening this historically exclusive, restricted elite-door for families of all incomes and backgrounds – formerly open only to V.I.P.s and mega-wealthy families – now open to all middle class and upper middle class California residents. Where visionary CEO Kerry Smith’s concept for trust loans are used in conjunction with Proposition 58, to buyout a co-beneficiary’s inherited property; also referred to as a sibling-to-sibling property transfer; while locking in a low property tax base. Keeping property taxes inherited from parents, plus fulfilling the need to equalize cash going to co-beneficiaries who wish to sell the same inherited property to outside buyers… walking away with less than if bought out by a trust loan organized by co-beneficiaries.
In California, Proposition 58 protects families that owe thousands of dollars in property taxes, while they organize and resolve related issues, typically over a 17 or 18 month period, settling an estate after the passing of the decedent leaving property to his or her heirs. Under Proposition 58 (voted into law overwhelmingly in 1986), a home and up to $1 million of assessed value of other real estate are excluded from reassessment when transferred between parents and children. This keeps the property tax assessment the same as if the property was still owned by the surviving parent.
People should research and get more familiar with these great tax breaks, at Websites like the BOE site at https://www.boe.ca.gov, covering Proposition 58; Or, informational Blogs and Websites like this free resource Blog, that focus on Prop 13 and Prop 58 as well as trust loans working in concert with the right to buyout a co-beneficiary’s inherited property; on business Websites like Trust and Estate Loans or Proposition 58 / Trust Loan specialists such as Commercial Loan Corp. Folks need to get their facts straight, and begin calling and emailing their political representatives, to get them working on property tax relief like they have in California!
To be fair, every single state in America should have property tax breaks like this – not just for wealthy folks and massive companies… but for everyone… regular middle class Americans. What is so difficult to understand about this? Are working class people in states other than California going to keep voting in the interests of billionaires, which is OK, but against their own best interests? Against property tax breaks for middle class or working class families? Now that makes no sense.
The fact of the matter is, especially during an endless pandemic, every state needs property tax breaks like they have in California, Proposition 13 tax relief benefits, the ability for beneficiaries that are inheriting residential or commercial property from parents to avoid property tax reassessment for the rest of their life if they hold on to that property — and even a secondary property as well. Proposition 13 has saved California taxpayers over $500 billion – saving the average middle class family over $60,000… since 1978.
People ask, what is so crucial about CA Proposition 58; important enough to stop a Proposition 19 tax upheaval to unravel Prop 58 and Prop 13 parent to child transfer ability, the parent to child exemption or exclusion. Which every state should have in one form or another. That’s the point here. Tax relief allowing you to save on the transfer of property from parent to sibling and sibling to sibling.
Using property tax relief solutions as an income-saving device for home owners makes it possible for beneficiaries to buyout another sibling’s share of inherited property; when getting a trust loan from a trust lender. Trust lenders advance you a loan of, for example, $400K, $500K, $700K, whatever you need to buyout a co-beneficiary’s inherited property; while at the same time you get to retain a low property tax base guaranteed by Proposition 13. Every state needs this badly right now. Especially with Covid-19 upending the US job-based economy. Every state needs CA Proposition 58 and Prop 13 type of transfer of property tax benefits and discounted rates.
Residents of all states should be communicating with their political representatives, to tell them all states in the US should be able to keep parents property taxes during property tax transfer, with parent to child transfer, or as attorneys call it, “parent to child exclusion” (from present day tax evaluation). Why should California be the only state in the union that enjoys genuine property tax relief?