What’s Good for California? Property Tax Revenue… or Property Tax Relief?

Property Taxes in California

Property Taxes in California

2021 forward, those in leadership roles in the state of California really should to get one thing straight. Middle class homeowners, working families, and even upper middle class property owners – which accounts for most of the state, frankly – do not need more property   tax hikes, and they do not need to be reaching deep into their pockets to be sending yet more tax revenue to the state; especially during a virulent pandemic, where middle class property owners are not getting any richer, nor (as the saying goes) are they getting any younger.
 
With so many people still furloughed, reduced to part-time work, or “temporarily” laid off… with more folks than you might think at 100% unemployed status… with a fair amount of companies shrinking their work force, with some even going completely out of business or leaving the state to set up shop in a nearby state where taxes are lower and property less expensive, plus lower overall cost of living. 

Therefore, with survival at the top of most peoples’ list, middle class families in California are not particularly interested in reading about all the billions going into the state coffers as a result of new property tax measures, in editorials and articles in local newspapers…

On the contrary, homeowners are far more interested in saving money through long-term, time tested California property tax breaks – often with information provided by seasoned property tax consultants like Michael Wyatt Consulting in Corona, and attorneys with decades of property tax relief expertise such as Rachelle Lee-Warner, Esq. at Cunningham Legal trust administration, estate-law firm in Auburn; or estate & trust lenders like Commercial Loan Corp in Newport Beach.

These firms help beneficiaries that are inheriting property from a parent save many  thousands of dollars every year by taking advantage of a (formerly Proposition 58) Prop 19 parent-child exclusion – working in conjunction with an irrevocable trust loan, making it possible to avoid property tax reassessment – buying out sibling property shares while keeping your inherited home at a low Proposition 13 tax base – buying out co-beneficiaries that are looking to sell off their inherited property shares for substantially more cash than an outside buyer would offer, which is the extra bonus. 

Firms like this will guide families through a Prop 19 parent-child exclusion and property tax transfer when inheriting property taxes, with the ability to transfer parents property taxes and keep parents property taxes through the parent-child transfer.

Every property owner and beneficiary should have reliable access to a firm that can lend money to an irrevocable trust – typically a trust loan lender.  Every  property owner in California should also have access to property tax appeals and property tax reduction, from boutique property tax relief companies. 

When we read local news or editorials, we’re encouraged to think about how wonderful all the extra property tax revenue is for California, and how helpful it is for local firemen and school boards, and how fortunate it is for realtors and well connected companies with special interest construction contracts.  Neither commercial property owners and homeowners don’t have the luxury of thinking about the state government’s terrific success at driving more tax revenue into the coffers from well disguised property tax hikes!

All property owners in California should have locked in rights to keep their yearly property taxes low, and when inheriting a home from parents and inheriting parents’ property taxes — to establish a low property tax base that will last literally forever. This is the most important safety net middle class and even upper middle class residents and beneficiaries have in the state of California… and should be focused specifically on taking advantage  that, not on the states’ fabulous increases in property tax revenue.

Can an Irrevocable Trust Get A Loan?

Can An Irrevocable Trust Get A Loan

Can An Irrevocable Trust Get A Loan?

As many of us who have traversed the complex trail of real estate loans and long lines of credit know – there are certain non-traditional financing options, such as loans to irrevocable trusts and probate estates, that are generally denied by virtually all lenders – with the exception of certain licensed trust lenders… or more specifically, irrevocable trust lenders.

Conventional lending organizations such a credit union or your friendly local bank, will typically deny any loan request of this kind and will rarely approve a loan like this to an irrevocable trust – until the trust has been dissolved and the home title has been converted to the financial interest of a borrower, or individual.

California trust beneficiaries and trustees find out very quickly that funding for a trust is not the type of financing your standard bank or conventional lending firm will deal with. We find that most niche financing can be accomplished for high net worth individuals, or for individuals with an extremely high credit rating… Not so in this case.

Even if you have a fabulous credit score or credit report, most lending organizations will still not fund an irrevocable trust for you.  For example, when you buyout beneficiaries that are instigating family conflicts by insisting that the family sell off inherited property  and wind up selling their inherited property shares to one or more siblings looking to keep the property in the family – and keep a parent’s low property tax base… This will make the sellers happy to do so when they find out that by avoiding a realtor to sell their inherited parental home plus other hidden costs they end up with a lot more cash in their pocket having their sibling or siblings buy them out through a trust loan.

In fact, no matter how urgent or important our situation is, we discover very quickly that the only type of firm that will fund an irrevocable trust is a trust lender, with genuine expertise in property tax relief, and in the subtle measures contained in Proposition 19, and Prop 13. As long as a loan to an irrevocable trust is structured properly by your trust lender, you should be OK buying out sibling property shares while keeping your inherited home at a low Proposition 13 tax base – what property tax professionals refer to as “equalizing the distribution of a trust…”

So, in other words, the party or parties keeping the parent’s home and low property tax base, as well as the beneficiaries selling off their shares, soon realize they are entering into a win-win transaction, where everyone walks away in better shape than when they began!

And that is the unique upside and tremendous benefit that a good trust lender brings to the table… in particular the well known trust lender, Commercial Loan Corp irrevocable trust loan financing, which focuses on helping beneficiaries to keep a parent’s low property tax base, long-term, through the parent-to-child exclusion, and ability to avoid property tax reassessment, through Prop 13 and now Proposition 19, which still protects and breathes life into property tax relief in the state of California. Commercial Loan Corporation can be reached at 877-756-4454.  They have a flawless record for assisting clients avoid property tax reassessment on an inherited home and their testimonials can be viewed on Google with this link.

Noted property tax relief consultant Michael Wyatt addresses this in his usual articulate fashion:

These property tax benefits from Proposition 13 came about in California because people didn’t want property tax increases of 25% or 30%, or whatever. It really was out of control. And property tax rates were particularly high and unpredictable and unstable in California, for whatever reason, prior to 1978 when Prop 13 passed. So, as you know, property appreciates let’s say on average 20% per year. For the sake of argument, let’s say 20%. But property tax values are only going up by 3%…

People know intuitively that they can’t rely on the Assessors evaluation. Property value goes up 10% or more let’s say, as opposed to assessed value going up by 2%. That’s a significant difference. Was California really that bad before 1978, when Proposition 13 tax relief went into affect? Yes. California was raising taxes more than any other state, before 1978.

Most seniors – before Prop 13 – were reassessed at present-day rates. And many, many were forced out of their home. They simply could not afford the property tax hikes descending on them. Period. People, especially older people, were being impacted with higher property taxes year after year. And in many cases – with catastrophic results, obviously.” Michael Wyatt can be reached at (951) 264-6152.

While at the same time providing the beneficiaries selling off their inherited property shares with more cash than any outside buyer would want to offer them. A definite upside of working with a trust lender, in conjunction with Proposition 19. Obviously, beneficiaries in this sort of equation would have their own attorney or law firm looking over their shoulder, and advising them on the paperwork.

Trust and estate needs are varied and sometimes complex, but taking an experienced view toward the real estate component can offer superior results. One common situation occurs when one heir wants to keep the “old family home,” but the trust entity does not have enough cash or investments to “even the equities” among the beneficiaries. That same heir may want to eventually live in the home, or convert it to a rental property in the future and hold it as a  long-term investment. Either way it is a profitable return.  

Working With An Irrevocable Trust Lender

Irrevocable Trust Lenders

Irrevocable Trust Lenders

First, let’s go back over the key elements involved in the most popular trust loan beneficiary-conflict solution available in California.  It’s worth mentioning that California is still the only state in America where you can avoid property tax reassessment at current rates; capped at 2% taxation basically as long as you own property inherited from parents… thanks to 1978 CA Proposition 13. 

And this is where we get into trust liquidity – something a lot of folks in California don’t really understand. California business property and residential property owners, in addition to having the right to keep parents property taxes, and transfer parents property taxes upon inheriting property, and then inheriting property taxes at the low Proposition 13 two-percent tax rate maximum – can maintain a low property tax transfer rate basically forever, through a parent to child transfer, or “parent to child exclusion”, as long as all tax relief requirements have been met, usually with the assistance of an experienced irrevocable trust lender.  

Additionally, Californians even have the right to apply for the same tax break on a secondary property inherited from parents.  Approval is a formality only. No only that, as a California property owner you can buyout as many siblings as you like; that is to say, as many co-beneficiaries as there are who wish to sell their inherited property shares – as long as you are approved for the appropriate amount of funding to a trust loan, from your trust lender… And as long as the co-beneficiaries are fully committed to selling out through a trust loan, rather than accepting less money from a third-party outside buyer – while you keep the same inherited property from your parents, financed through the trust loan, avoiding property tax reassessment for that point on, establishing and maintaining a low Proposition 13 property tax base.

Elements that drive this process are worth researching, to understand the subject better and simply to be able to work more effectively with a trust lender… Many of these process elements are covered in detail on the California State Board of Equalization website, focusing on various relevant components within Proposition 58 among others.  Or you can research heavily detailed business sites such as Commercial Loan Corp, the brainchild of forward-thinking CEO Kerry Smith;  or info-blogs such as Medium.com,  or perhaps  the Trust and Estate Loans micro-site; or the Property Tax News blog…  Trust loans working in accord with Proposition 19 make it possible for heirs and beneficiaries to sell their shares of inherited property, a co-beneficiary buyout of sibling property shares – as realtors put it, “the transfer of property between siblings”, and “lending money to an irrevocable trust“ – typically from an irrevocable trust loan lender.

Commercial Loan Corporation in Newport Beach, CA appears to be the “favorite flavor” of the decade, where trust lenders are concerned, as they specialize in taking full advantage of all Proposition 19 property tax relief benefits for clients; helping beneficiary siblings avoid property tax reassessment, while making sure they transfer parents property taxes correctly, when inheriting property taxes from parents, a business facility, home and/or land; abruptly inheriting property taxes that have to remain low, simply to free up some needed cash; in order to keep up a reasonable lifestyle, what with the cost of living in California these days.  

You also want to be careful, to work with a trust lender that has a great deal of experience with this process… To make sure that beneficiaries and  property owners take full advantage of the right to keep parents property taxes, with a low Proposition 13 tax base.  No other state in America even comes close to providing this sort of property tax relief. And property taxes in this country, for the most part, are high for a middle class and working class families. No other state gives residents the ability to use a CA Proposition 58 or California Prop 13 type of property tax transfer, with parent to child transfer, or as lawyers like to call it, “parent to child exclusion”.

The fact is, we need to know how to work with a professional trust lender to be able to use tax breaks as efficiently as possible, that as Californians we are fortunate enough to have access to.  Moreover, every property owner in every state should know how to work with an irrevocable trust lender to buy out a beneficiary’s share of inherited property; and basically understand how a sibling-to-sibling property transfer or co-beneficiary buyout of sibling property works in California.

Bottom line, every state in this country should have trust lenders to work with  to take advantage of residential and commercial property tax relief solutions similar to Californian property tax breaks such as CA Proposition 13, and now Proposition 19 – enabling property owners to keep parents property taxes, at a low 2% capped tax base from Prop 13… along with property tax transfer benefits still in effect from CA Proposition 58; enabling the transfer of property between siblings, or, more specifically, allowing a co-beneficiary buyout of sibling property, paying them cash to not sell out, while you get to keep your parent’s house and/or land at that super low Proposition 13 protected tax base.

If you are in need of a loan to an irrevocable trust, please completed this form and we will have a representative from Commercial Loan Corporation contact you; or you may call them at 877-464-1066: