Property Tax Relief for All Americans, Not Just California

Property Tax Relief

Property Tax Relief

A recent survey from Ameriprise Financial:

  • Discovered that 65% of Americans have never written and   signed off on a Will;
  • 77% of Americans plan to leave a financial inheritance for their children or grandchildren;
  • 64% of Americans believe they are actually in a position to even leave an inheritance of any kind to their children;
  • only 50% of aging American parents have an estate plan in place reflecting inheritance assets being left to their children.

Some retirees are committed to leaving money and assets to their children; while other parents see it as “a good thing to do”… yet “not essential” as part of their plan for retirement. Not exactly a sign of high interest on the part of parents, is it, where leaving money to their children are concerned!

However, middle class and even upper middle class families in the United States are understandably concerned about cash flow, and the future of their net worth.  Exacerbated by increasing concern over the variant Covid virus issues; which further discourages  parents from leaving anything at all to their children upon passing away… virus or no virus.

These concerns are causing many families in America to believe that all states in America, not just California, should have tax relief laws benefiting middle class, lower middle class and upper middle class consumers, not just tax cuts and property tax breaks for wealthy residents.

Different state economists are looking specifically at property tax relief for their state, as this is one of the simpler areas to affect in this manner to help free up more consumer cash, and thereby improve their overall economy in this fashion, step by step.

Allowing beneficiaries of trusts and heirs of estates to be able to access genuine property tax relief… with the ability to get a loan to an irrevocable trust from a trust lender, when parents leave a home to them as an inheritance.  This enables these folks to keep their family home, inherited from parents, at a low property tax base.

This process also enables beneficiaries to buyout sibling beneficiaries – or as attorneys put it, “the transfer of property between siblings, without a direct sibling-to-sibling transaction” – by lending money to an irrevocable trust – typically from an irrevocable trust loan lender, who can guide your ability to buyout sibling beneficiaries, and show you how you’re putting a lot more cash in siblings’ pockets when you go through a trust loan to buyout sibling beneficiaries. The fact is, we need to know our rights, with respect to these unique tax breaks. 

Homeowners and beneficiaries in all states should know how to buy out beneficiaries’ shares of inherited property; and how sibling-to-sibling property transfer works. Moreover, all Americans should know how loans to irrevocable trusts can help co-beneficiaries get cash while avoiding selling their share of an inherited house – keeping yearly taxes on property at their parents low tax base.

All middle class Americans should be aware of  the California system, of California advantages of inheriting parents property and thus inheriting property taxes that are lower and can remain low. Property tax transfer is an unknown in so many states…whereas  inheriting a parents’ low property tax base, and avoiding property tax reassessment, as well as being able to buyout sibling beneficiaries with a trust loan – should be known to all, and be a normal state of affairs in all states.  It certainly is a “best kept secret” for wealthy families all across America!

Property owners in other states can surely find the time to start the ball rolling to start adopting these property tax relief laws, plus they should be able to see how these types of yearly savings free up cash for many homeowners to be able to purchase a larger home later on.

This would feed more sales activity and cash back into the local economy, with loans to trusts to avoid property tax reassessment, working in concert with new property tax measure that became active in Feb of 2021, California’s Proposition 19 – which used to be the ultra popular Proposition 58, enabling exclusion from current tax rates with a parent to child property tax transfer – along with Proposition 193 for grandparent-to-grandchild exclusion from high fair market rates.

Designing a system like this that has been so successful in California would keep property taxes at a much more equitable system state by state, whereas right now most states do not have a system in place similar to California are not offering middle and lower middle class families a sustainable system within which they can thrive and increase their spending ability.

Californians would then be able to give back more consistently into the general overall economy – inheriting property taxes they can afford, hence being able to maintain inherited property, while helping to increase overall intra-state consumer spending. Creating positive overall financial connectivity, instead of separate declining family spending capabilities, which do not benefit the whole at all.

Economists in many states now believe that within struggling families, if beneficiaries were able to transfer a low property tax base from parents, with an iron clad right to keep parents property taxes as a part of the inheritance process, from parents and grandparents – middle class, upper middle class, and working families would all benefit greatly, and at the end of the day their state would benefit as a whole as well.

If this system were in place in other states, families would be able to free up more cash to spend on goods and services all across their state, thereby benefiting merchants and other consumer businesses, benefiting their families, so they can spend more, moving more cash into the economy, and so on – benefiting each state economy all the way around in every state that shifted in this direction with property tax relief measures designed to help not only individual homeowners and beneficiaries but each state in general.

Saving money on inheritance based property transfers would (as it does in California) allow middle class and upper middle class beneficiaries who do not wish to sell out to keep their parents’ home in the family, which most middle class inheritors otherwise could not afford to do. And yet, unfortunately, California is still the only state that provides a systemic system to help residents avoid property tax reassessment at current, unaffordable rates.

This sort of property tax relief program… capped at 2% taxation, as offered by the 1978 CA Proposition 13 would allows residents in other states to keep parents property taxes, and inherit property taxes at a low property tax base… having the ability to use a Proposition 19 style property tax transfer, with a parent-child transfer or parent-to-child exclusion.

Helpful Advisors During a Property Tax Transfer on an Inherited Home

California Property Tax Transfer

California Property Tax Transfer

Transferring A California Property Tax Base On An Inherited Home

If you’re a member of one of the many families who owns real property in California – it would be wise to understand how much Prop 13 and Proposition 19  can affect property tax reassessment, no matter where you live in the state. 

In fact, it’s never been more important than now to understand how profoundly these property tax relief measures can impact your life – plus how important it is to do everything correctly when dealing with property tax breaks like Proposition 19 and Proposition 13.

Number One Strategy: Avoid Making Mistakes!

For whatever reason, a fair amount of residents do not fully understand how these tax breaks work, and how to make them work.  The problem is, families often trigger reassessment of their property taxes by accident, due to a variety of reasons – refusing to hire an estate attorney simply to save money; faulty data; or mistakes filing information; missing document deadlines… so on and so forth.

Consequently, what can be lost can be significant… such as the ability to avoid property tax reassessment, to miss out on property tax breaks such as parent-child transfer and the parent-to-child exclusion; the right to transfer parents property taxes, to keep parents property taxes after a CA property tax transfer, when inheriting property taxes.

It’s not difficult to mishandle a transfer of property when inheriting a home, or mishandle the drafting of a trust in such a way that expectations towards a cap on property taxes are disappointed. Of course, these types of errors and subsequent property tax  reassessment brings great happiness to the parties responsible for collecting property taxes all over California.

Families that are concerned with making sure these processes go smoothly generally enlist advice and/or the services of a real estate law firm or estate attorney such as Rachelle Lee-Warner, Esq. at Cunningham Legal, or a property tax consultant like Michael Wyatt Consulting, or perhaps a Trust Lender such as Commercial Loan Corp.

Proposition 19 and Revisions to California Property Tax Relief

It is difficult to avoid the fact that property tax breaks in California have been impacted, one way or the other, by Proposition 19; which was voted into law Nov 2020, becoming active on Feb. 16, 2021.

Under Proposition 19, a parent can transfer their primary residence and low property tax base to their children (i.e., heirs) — allowing  offspring to move into an inherited home rather quickly, within 12-months, as a principle residence.  Although, if the home is valued at more than $1,000,000 it may be reassessed, with an impact on the parent-to-child exclusion from current tax rates.  On the other hand, if you’re over 55, physically impaired, or a victim in some way of the frequent wildfires California has been experiencing, or some other natural disaster such as a flood or earthquake — you can be a recipient of numerous property tax breaks on top of CA property tax transfer (discussed in detail elsewhere within this Blog).

However, beneficiaries of parental property have other options, such as working with a trust lender such as Commercial Loan Corp, for example, in addition to having expertise in CA property tax transfer,  the ability to provide funding to an irrevocable trust, in order to buyout co-beneficiaries looking to sell off their inherited property shares, as well as establishing a permanently low property tax base. If you think you may benefit from a Proposition 19 property tax transfer on an inherited home, you can reach Commercial Loan Corporation at 877-464-1066 for a free benefit analysis.

Time is Ripe to Become Better Acquainted With the Parent to Child Property Tax Transfer

California Parent to Child Property Tax Transfer

How to Obtain the California Parent to Child Property Tax Transfer


Avoiding Property Tax Reassessment & Property Tax Hikes


It is our consensus that normal middle class class residential owners, upper middle class home owners and working families, none of whom are generating a huge income at the moment, should most likely not be supplying the California state government with extra property tax revenue right now. 

This is especially true during a financial crisis such as the Covid predicament we find ourselves in during 2021… where revenue is tight all over the country, especially in California, with only a few exceptions here and there – where in general unemployment, as well as under-employment, is extremely high.

Regular middle class and upper middle class homeowners need to be saving money, and spending less, not spending more. Certainly not spending more on housing or standard goods and services, or on income tax or property taxes. We’re not talking about luxury goods or high-end services. That is specific to folks with disposable income, and is an entirely different matter altogether. 

As a matter of fact, property taxes are the one big-ticket item just mentioned that is easily lowered, or paused, or even deferred.   And if this never occurs, then property owners are going to have to be more cognizant of related details and new tax laws, as well as  new ways to avoid property tax reassessment – and tax specialists or real estate experts that are available in California to help with these matters.

Middle Class Property Tax Savings

When times are hard, as they are now, the state should help residents with key information on property tax breaks, helping property owners take full advantage of established property tax breaks, like the new Proposition 19 parent-to-child transfer and parent-to-child exclusion from reassessment of property taxes.

And this means not spending more on taxes when times are hard. Certainly, property owners should all be better informed about inheriting property taxes, and Prop 19 parent-to-child exclusion; about property tax breaks, and being able to transfer parents property taxes, with the right to keep parents property taxes on every property tax transfer.

Owning a Home is Part of the American Dream

Purchasing or inheriting a home is part of the classic American dream, and leaving part of that dream to heirs or beneficiaries is something most of us would be proud of.  However, fluid, ever-changing and complicated  property tax laws have to be kept up with, either by ourselves, or through specialists that make a living helping property owners with issues like property taxes.  

Getting expert property tax advice and estate planning advice can help save that dream, and help sustain good family financial practices for generations to come, where your home and other big ticket investments are concerned. 

Genuine Property Tax Relief

The property tax breaks middle class and upper middle class Californians are holding on to are the only safety-net solutions middle class residents have in this state, so the Legislature should be focusing on preserving and strengthening those tax breaks, and on educating and informing Californians about establishing a low tax base for trust beneficiaries; about Prop 19 parent-to-child exclusion and Proposition 19 – parent to child property tax transfer on an inherited home; plus Proposition 13 property tax transfers, as well as the Proposition 19 impact on CA homeowners, and avoiding property reassessment wherever possible – not on obsessively driving more tax revenue, under cloaked measures called “property tax relief” that are merely tax deferments.

Even when it means a little less property tax revenue going into their coffers, it shouldn’t matter to the state government.  In the long run, helping to preserve working families’ financial health and helping them to pay less property taxes, thereby building up more savings, will drive greater property tax revenue to the state, as more people will own homes and pay taxes!  This is what the Legislature would see if they saw long term rather than short term. 

All middle class Californians should be able to depend on secure, authentic property tax relief – like wealthy folks and corporations have in every state in America. Why should only the wealthy enjoy genuine tax cuts and real property tax breaks?

Inheriting a Home in California & Trust Loan Property Tax Savings in 2021

Trust Loan Property Tax Savings

Trust Loan Property Tax Savings

2021 Property Tax Relief & Using an Irrevocable Trust Loan for Homeowners and Beneficiaries Inheriting Property in California

As many Californians that are seeking lower property taxes know by now, current property tax relief measures open up new opportunities for you to take advantage of, if a parent is leaving property to you and your siblings – and you’re looking to keep a low property tax base. 

You can now look forward to new property tax relief opportunities, some that are difficult to understand – that allow you to move into inherited property quickly, within 12-months as a principal residence; in order to take full advantage of the Proposition 19 parent-to-child exclusion (from current property tax rates) to avoid property tax reassessment.

What you may not know a great deal about, however, or what may be difficult to understand, are certain highly effective property tax breaks that are now available to you, if you’re a beneficiary inheriting property from a parent – using an irrevocable trust loan, in conjunction with a Proposition 19 parent-child transfer, with the help of a trust lender.  This is frequently taken advantage of by beneficiaries, perhaps like yourself, who intend to keep a home inherited from parents at the original low property tax base – also making it possible to buyout inherited property shares from co-beneficiaries, using an irrevocable trust loan.

Avoiding property reassessment is a property tax relief benefit available to all Californians, as long as all new requirements are followed. So beneficiaries, new homeowners, can  transfer parents property taxes when inheriting property and inheriting property taxes; with the right to keep parents property taxes for as long as they want, as long as they reside in their inherited residence.                        

Hands On Experience, Establishing a Low Property Tax Base

If it were your siblings selling their property shares – you’d be providing them with a good deal more money than an outside buyer would offer, for the same property; plus locking in a low property tax base for yourself – from a trust lender like Commercial Loan Corp.  And, speaking of which, certain benefits are aptly summarized by a client, who said:

“…just closed my first loan (refinance) with Commercial Loan Corp with a very low 30 year fixed rate (honestly a lot less than we ever anticipated)… This firm was very knowledgeable about [using an irrevocable trust loan] process and trust legal issues involved.  We have been trying to get a refinance for this property for over 5 years! So happy that we found a trust lender like this!(1)  

New 2021 Property Tax Relief Advantages in California

Many California residents are not aware of certain new property tax breaks that provide tax relief for homeowners over 55.  Moreover, residents that are considered to be “severely disabled” can now also transfer taxable value from their current house to a new home – as long as the value of the new house is less than or equal to the value of the previous home.

Other improvements for certain segments of the population in California are, surprisingly, not well known throughout the state – most likely due to unintentionally poor communications from folks in state leadership roles;  plus  confusing coverage by the media.  Improvements, for example, as of April 2021 when Proposition 19 gave victims of wildfires and other natural disasters – regardless of age or disabilities – the right to transfer lower taxable value to a new home.

If this pertains to you, it would definitely be worthwhile to investigate, and discuss with well known property tax relief  experts such as, for example, attorney Rachelle Lee-Warner, Esq., a senior partner at estate, trust and tax planning law firm Cunningham Legal in Oakland Hills, CA with many other offices throughout California, specializing in Trust Administration; or Michael Wyatt Consulting in Corona,CA, specializing in real estate transactions, using an irrevocable trust loan, and property tax relief in general.  Or any firm with similar focus and equivalent experience.  

Having a seasoned specialist  like that to help guide you through some of the new advantages Proposition 19 offers  ends up saving you a lot of money on property taxes, if you meet the requirements.

For example, if you’re a  homeowner over 55 or are “severely disabled”, you won’t be limited to buying a new house and transferring your lower tax base only within the same county that your previous home was situated in. Now, you can  relocate to any of the 58 counties in California and still retain your previous, low property tax rate.  

CA Property Tax Relief Improvements Reported in the Media

ABC-10 News, in addressing property tax relief changes, confirms that: “…this law benefits seniors, the disabled, and victims of wildfires and disasters. California property owners are paying the same taxes based on the price they originally paid after California enacted a law to keep property taxes down in 1978. Proposition 19 lets people keep their tax base when they move anywhere in California up to three times and only pay higher property taxes on the difference. This would allow wildfire victims to move anywhere in the state without facing massive tax hikes.”  (2)

Interviewed on KPBS News, Jordan Marks, a taxpayer advocate for the San Diego County Assessor’s Office also offers his opinions.  Mr. Marks tells us: “Seniors are gonna get the benefit to transfer their replacement property. So they sell their primary home and they can get a second one, and they can do it three times now versus the one time allowed under the former tax law.” (3)

Members of the state Board of Equalization are eager to address the type of confusion we mentioned earlier, that is often associated with the Proposition 19 tax law.  Mr. Gary Gartner at the CA Board of Equalization tells us: “We have a lot of constituents calling in expressing [mixed] opinions of the new law. The board is trying to work out ambiguities in the law with assessors around the state and legislators in Sacramento. To that end, the board is holding virtual town hall meetings just to give people the opportunity to better understand the complexity of this law, which is really challenging…” (4)

The value of any new house can be larger than the value of a previous home – although the increase in value naturally has to be added to the previous home’s transferred assessed value. If this seems confusing, you can always enlist help from a property tax consultant or trust lender.

Trust Loans & Estate Lending in Concert With New Property Tax Breaks

Beneficiaries that are selling their inherited property shares actually receive more money through a trust loan than if they were to sell their inherited property to an outside buyer – by avoiding realtor fees and other costs,  each of those co-beneficiaries receives, on average, an extra $15,000+. While the heir or beneficiaries retaining the family house get to save $6,200 on average per year in property taxes. This savings adds up. (5)

It may sound complicated, but when you speak to  a trust lender or  property tax consultant, the details become clearer after you apply your own specs in discussion with a property tax specialist.  To discuss a home you may be inheriting, as well as property tax savings – Call attorney Rachelle Lee-Warner, Esq. at Cunningham Legal, Michael Wyatt Consulting, the Trust Lender Commercial Loan Corp, or the Property Tax News at (877) 756-4454.

What is the Role of CPAs in Helping Residents With Prop 19 Establish a Low Property Tax Base

Inheriting Property Taxes in California

Inheriting Property Taxes in California

Inheriting Property Taxes in California From a CPA’s Expert Point of View

Many accountants and property tax consultants these days have reinvented themselves to some degree and have become Proposition 19, 2021 revised property tax relief experts for middle class families and beneficiaries inheriting real property, and for new homeowners in both the middle and upper middle class California income brackets. 

One such noted CA property tax relief expert and CPA, Komal Kabra from Chugh.net, has a lot of interesting things to say, from her focused CPA perspective on property taxes and property tax relief in California.  She tells us:  “Property tax law  protected by Proposition 13 levies property taxes based on a home’s original purchase price, even as the home’s value appreciates over time. Additionally, the law caps property tax at 1% of sale price, with a maximum 2% increase per year.” 

Under  new Proposition 19 property tax regulations, the number of times the tax rate can be transferred to a new home is now three times, versus once under previous tax law… if you are age 55 or older.  Value of the new home compared to the previous home can be any value; and the location of any new home can be anywhere in California. 

Admittedly, this is an excellent improvement offered by Proposition 19, however it is clear that the age issue must be seriously revisited  in the near future, and opened up to embrace younger age groups.  Although it is an interesting turnabout of American age bias, which is typically going the other way around, with bias against folks in the 50 to 60 age group and older. 

CPA Kabra goes on to say:  “Proposition 19, which delivers property tax savings to eligible property owners, including residents who are age 55 or older; Folks that suffer from severe disabilities and people who have lost their house in a wildfire or officially validated natural disaster, such as a dramatic flood or extreme earthquake.” 

Proposition 19 preserves all of these new property tax breaks, while also enabling eligible middle class and upper middle class property owners in California to transfer their lower “base year” property tax rate to a new home of any value, anywhere in the state,  up to three times – affecting homes purchased on or after April 1st of 2021.

Miss Kabra concludes, with a real-world example: “If an eligible homeowner purchases a home of a greater value than their previous home now, under Proposition 19, they will pay a blended tax rate. For example –  let’s take a middle class couple in their 60s, who own  a home worth $600,000 in Los Angeles, which they purchased in 1972 for $200,000.  Let’s say they sell their L.A. home, and purchase a new home for $700,000 in San Diego.  The first $600,000 of the new San Diego home will be taxed based on their original 1972 purchase price of $200,000.  Only the next $100,000 will be taxed based on current or “fair market” value…” 

Saving Money on Property Taxes With Help From the Experts!

There are other challenging property tax issues, as well as critical property tax relief advantages and property tax breaks, for middle class and upper middle class families to address, with which to avoid property tax reassessment, when inheriting property taxes in California…

New property tax relief advantages include the right to transfer parents property taxes and then keep parents property taxes when inheriting property and inheriting property taxes in California, associated with any standard property tax transfer; leading up to and through the parent-child transfer and parent-to-child exclusion (from carrying a “fair market”, or current, property tax burden).  Leading towards Keeping Your Parent’s Low Property Tax Base When Inheriting a Home; or inheriting a new primary residence that requires a transfer of a parent’s low property tax base. 

If done properly with a trust loan from a trust lender a low property tax base can remain in place for decades, when inheriting property taxes in California, saving residential or commercial property owners hundreds of thousands of dollars in the long run.

All the more reason for you to call a property tax consultant or a trust lender experienced in Parent To Child Property Tax Transfer On An Inherited Home as well as the use of irrevocable trust loans and Proposition 19, as well as Proposition 13, to keep your parent’s low property tax base – if you are inheriting a home, or expect to inherit a home at a low property tax rate; and plan to transfer a low property tax base to a new home down the road. 

Or, if you wish to buyout existing co-beneficiaries that are looking to sell their inherited  property shares, while you are set on keeping that same inherited property in the family – plus keeping the same low property tax base your parents enjoyed.  All of these important family issues are well worth careful consideration.

To learn more about your options when inheriting a house from parents – transferring their principle residence’s low property tax base to your new primary residence – call our main line to ask to  speak with a Trust Fund Loan or Property Tax Savings specialist at Property Tax News, the Michael Wyatt Consulting firm, or the Commercial Loan Corp, at (877) 756-4454 

Keeping Your Parent’s Low Property Tax Base When Inheriting a Home

Keeping Your Parent’s Low Property Tax Base When Inheriting a Home

Keeping Your Parent’s Low Property Tax Base When Inheriting a Home

How to Keep Parents Property Taxes In 2021

What was once the parent-to-child property tax break called CA Proposition 58 has now morphed into a property tax relief measure to help avoid property reassessment, called CA Proposition 19… active as of Feb 16, 2021.  

Estate and trust lenders are accustomed to teaching beneficiaries and new homeowners freely, in unfettered fashion, how to keep parents property taxes with Proposition 13 or Proposition 58 property tax breaks. But they are still funding trusts with a loan to an irrevocable trust, and helping clients to establish a low property tax base, to avoid property reassessment… Property tax specialists like this are still helping beneficiaries buyout a sibling’s share of inherited property, through a trust loan – the transfer of property between siblings. 

Property tax relief experts are still showing beneficiaries how to keep parents property taxes on a property tax transfer, taking advantage of the parent-to-child transfer or parent-to-child exclusion (from current property tax rates); helping families inheriting a home to transfer parents property taxes when inheriting a home, and inheriting property taxes. 

Help From Experts  

Some California firms with property tax relief expertise have been encouraged to get creative, to meet new property tax challenges and obstacles head on.  Firms such as Michael Wyatt Consulting in Corona who specializes in base year value transfers and parent-child transfer exclusion; real estate issues and property tax relief; or well known trust lender and Prop 58 / Prop19 experts Commercial Loan Corp in Newport Beach, who specializes in irrevocable trust loans and lending.  This particular trust lender is now offering heirs and beneficiaries inheriting a home from parents a free consultation for property tax savings – to help beneficiaries inheriting a home from parents to keep the parents’ low Proposition 13 property tax base; while also taking full advantage of Proposition 19 and Proposition 58.

This type of evaluation for property tax savings is designed to simplify a relatively complex process, helping heirs evaluate the benefits of a loan to an irrevocable trust, specifically for beneficiaries who want to buyout siblings’ inherited property shares, while keeping inherited property at their parents’ low property tax rate – as well as avoiding costly expenses associated with selling property through a realtor.  

The name of the game is to simplify the use of Proposition 19, as well as the transaction between trust lender and beneficiary. A process that is often difficult for families to understand.

Inside View From an Account Manager’s Perspective

One such seasoned proponent of simplification of the Proposition 58,  trust loan process is a highly experienced account manager by the name of Tanis Alonso – a particularly hard working, dedicated senior manager, who works closely with her clients, and frequently their estate lawyer or accountant.

In a recent interview with this blog Miss Alonso described her unique personal approach to planning and implementing estate & trust loans for families; how property tax saving trust loans and Proposition 58 tax breaks factor into her family undertakings and financial proceedings, Miss Alonso tells this blog:

We don’t view each trust loan scenario as simply a ‘financial transaction.’ Nor do we see the home they’ve lived in for decades as just a ‘piece of real estate’. To us, this a ‘piece of family history’ in the making. And the process a ‘family decision,’ not a ‘transaction’…

Let’s say a property value is currently one million dollars and the current tax base is $1,200. If they were to get reassessed at current value that would be around $11,000 annually. By someone keeping the property and obtaining a trust loan to properly buy out their siblings that allows the beneficiary that is keeping the property to keep parents property taxes, to retain 100% of the Proposition 13 tax base that was paid by their parents and keep that low property tax base of $1,200.

This of course creates much greater affordability than if they were to improperly buy out their siblings and have that property reassessed. The loan to trust goes hand in hand with the Proposition 58 property tax transfer system, creating enough liquidity to equalize distributions, not sell, and allow a beneficiary to keep their parents property with their low property tax base.

Feedback From A Seasoned Property Tax Consultant

The other example we mentioned, Michael Wyatt Consulting, works in conjunction with real estate attorneys and frequently a trust lender, and formally reviews clients’ real estate values. The firm studies and forms strategy for proposed real estate transactions; ensuring avoidance of property tax assessment.

Mr. Wyatt conducts comprehensive research on real property, real estate deeds, and other instruments for accuracy; and serves as a liaison between clients and the Tax Assessor’s Office – maintaining problem-free communications with Assessors and other essential local government agencies. Mr. Wyatt explains:

We let our clients know the Proposition 58 [or Proposition 19] tax benefit entitles children of parents leaving them property to preserve the low Proposition 13 maximum 2% tax base. A California property tax transfer. However, a lot of people don’t fully understand that you have to apply for the benefit. It’s not automatic. And it doesn’t apply to the principal home. explain to them that they get the assessed value tax benefit only if it’s a non principal home. You get the assessed value waved if for example it‘s a million dollar property… You get the million excluded – but the overage is reassessed… A lot of people don’t know that.

The creators of the trust get this benefit. definition of ‘a child’ or “children” is typically the adult children of a decedent…But this also refers to step-parents. Step-parents can also transfer property to a step-child… Mom can be a step parent and can still get the benefit. In-laws get the benefit as well. You don’t have to be blood relatives.

We basically introduce the trust lender, for example Commercial Loan Corporation, as a private money lender that loans to irrevocable trusts, that applies for and works in tandem with California Proposition 58 [or Proposition 19]… for beneficiaries who are looking to sell their real property shares – for the purpose of facilitating “non pro-rata distribution”… So every heir gets an equal share of the entire overall estate – however, not necessarily of every asset.

Well, if the family in question uses the Commercial Loan Corp company that we have been using for years… the loan they provide is to a trust, and not to beneficiaries; so there is no title, and no crippling 66.66% property tax reassessment.  Well, for example, there might be three siblings… beneficiaries – and a house to inherit. And this is always important to remember.

If you’re one out of the three siblings that wants to keep the inherited house, you are definitely looking at a 66.66% property value tax reassessment – if you’re operating without a loan to a trust, or you’re using your own cash; or getting money from a very pricey institutional lender – typically with multiple restrictions and extremely strict terms.”

Mr. Wyatt sums up and simplifies a process that tends to look complicated to new clients.  At the end of the day, all families need to understand is the fact that in the end, they save a great deal of money on property taxes if they aim to keep their parent’s home.  If they are looking to sell, they simply need to understand that they will be putting lot more cash in their pocket  using the trust loan approach, rather than selling to an outside buyer.  Everything else is secondary, if you are inheriting property.

If you are interested in finding out how much you might be able to save by keeping a parents low Prop 13 property tax base on an inherited home, we suggest you contact Commercial Loan Corporation at 877-756-4454. They will provide you with a free estimate on what your annual property tax savings will be and provide you with information on the Proposition 19 process.  They can even put you in contact with a trust and estate attorney in your area if needed.

Changes to California Property Tax Relief in 2021

Changes to California Property Tax Relief in 2021

Changes to California Property Tax Relief in 2021

The Home Protection for Seniors, Severely Disabled, Families, and Victims of Wildfire or Natural Disasters Act (AKA: Prop 19)

For homeowners in California , it’s important to have a good general understanding of how property tax relief is changing. Fortunately, Californians finally do have a clearer understanding of what property tax measure Proposition 19, passed into law on Nov 3, 2020 by voters in the state of California, is really all about, as well as how Proposition 58 has changed, in terms of property tax reassessment.

A lot of property owners in California aren’t aware of the fact that Proposition 19 was also entitled, “The Home Protection for Seniors, Severely Disabled, Families, and Victims of Wildfire or Natural Disasters Act” – A peculiar, overly wordy title; indicating that seniors, severely disabled people and victims of wildfires or natural disasters will be able to transfer the taxable value of their “original residence” to a “replacement residence” up to three times during their lifetime – anywhere throughout all 58 counties within the state of California.

California State Board of Equalization Chairman Antonio Vazquez said, in regards to the new tax measure, Proposition 19: “Seniors, the severely disabled, and victims of wildfires or natural disasters can now move to a replacement home anywhere in California and avoid significant property tax increases if eligible.  Property tax relief can be beneficial for those especially on limited incomes or who have been affected by wildfires or natural disasters.”

What is the California State Board of Equalization (BOE)?

For all of us who have heard all about BOE for many years, yet have not really understood what the California State Board of Equalization was really all about – it would be a good idea to sit down for a moment and look more closely at the BOE, and see what it is that they do, and how they break down the new Proposition 19 tax measure. 

For starters, the CA State Board of Equalization is literally the only elected tax board in the United States. It contains four Equalization District Members, positioned by locale, plus the State Controller. BOE’s legal responsibilities encompass the management of 58 County Assessors to make sure assessment best practices are in order statewide, without deviating from the set rules and regulations.

Believe it or not, the State Board of Equalization also assesses the property of public utilities along with regulated railroads, and takes in revenue from private railroad car tax. BOE also manages “Alcoholic Beverage Tax” and “Tax on Insurers”; plus property tax administration, promoting “fair and equitable assessments” – protecting tax revenue that school systems, local communities, and the California Legislature depend on, year after year.

Dispelling Confusion Around Proposition 19

The BOE also clarifies some of the confusion surrounding Proposition 19 and its’ ability to help residents avoid property reassessment, in contrast to Proposition 58; confirming that middle class seniors, age 55 and older… often  living on a modest fixed income; or those severely disabled, must meet specific requirements to qualify for new property tax breaks.

Both an “original” and “replacement residence” has to meet special requirements in order to be eligible for the homeowners’ or disabled veterans’ exemption. An application has to be completed and filed with the County Assessor to enable transfer of any taxable value. Finally, a “replacement residence” must be purchased or newly constructed within two years of the sale of an original home. If the market value of a “replacement residence” is greater than the market value of the “original residence”, the difference will be added to the taxable value when transferred.

As far as victims of a wildfire or natural disaster are concerned, similar requirements apply but there are no age restrictions. In order to qualify, a residence has to be seriously damage by a wildfire or a legally verified (frequently “governor verified”) natural disaster.

Parent-Child Exclusion, Originally Under CA Proposition 58

It is true that CA Proposition 19 limits property tax relief under CA Proposition 58, most notably the parent-child exclusion.  This eliminates the $1,000,000 assessed value reassessment exclusion as in a parent-child transfer of residential property that is not a primary residence. This obviously limits the parent-child transfer exclusion from property tax reassessment to primary residences only. 

Yet as long as that criteria is met, Californians can avoid property reassessment, keeping a low property tax base when inheriting a home; as long as the parent leaving the property resided there as a principle residence as well, plus beneficiaries inheriting the property make sure they move in within that 12-month deadline, the California parent to child exclusion from property tax reassessment is protected by Proposition 19, formerly by Prop 58.  As long as this type of property tax transfer, Prop 19 property tax break, is used properly, and the move into an inherited home occurs within one year of inheriting property taxes from a parent.  To reiterate, taken over by the beneficiary, or heirs, as a primary residence; in order to avoid property reassessment.  And according to the new tax laws, as of Feb 2021,  this is the only method left to residents, after Proposition 19 limits are imposed, to be able to  successfully transfer parents property taxes – and keep parents property taxes, basically forever.                     

Transfer of Assessed Value to a New Residence

To review, the other major changes to property tax relief for California property owners, as we touched on a moment ago, is relief for homeowners age 55 and older, folks with a disability, or victims of a wildfire or natural disaster. These residents are now able to transfer assessed value of their primary residence in any county in California – to a home they have just bought, or a newly constructed “replacement residence” used as a primary home.

These new Proposition 19 measures apply to real estate anywhere in California, if you are a resident of the state or not.  Which is a positive change – plus, certain property tax breaks used be accessible only in certain counties.   Californians with vacation homes, residential homes that are for rent, or commercial properties (owned outside any corporations, partnerships, limited liability companies, etc.) may not be able to avoid property reassessment, and may have to face property tax reassessment burdens, and may want to seek legal counsel or help from a trust lender or property tax specialist or consultant.

Unexpected Limitations Imposed on the CA Parent-to-Child Exclusion From Current Property Tax Rates

The California Parent-to-Child Exclusion for Property Tax reassessment

Keep a parents property tax rate on a home you inherit.

Parent-to-Child Transfer to Avoid Property Tax Reassessment

The ability to avoid property tax reassessment in California through Proposition 13 and Proposition 58 or Proposition 19 is not available only to families that own shopping centers, office buildings or apartments – it’s there for every middle class beneficiary and working family inheriting property from parents – to take full advantage of.  Despite limitations now imposed on some of these property tax relief measures, as of 2021.  It is still there to utilize, and unlike most tax loopholes and tax breaks, it’s not just for the wealthy.

Californians have relied on the Prop 58 parent-to-child transfer and Proposition 193 (grandparent-grandchild exclusion) to transfer California real property to children and grandchildren without property tax reassessment.  Until February 16, 2021, parents could transfer ownership of a principal residence of any value and up to $1 million of assessed value (per parent) of non-principal residence property (vacation and rental homes, commercial property, etc.) to one or more children or one or more irrevocable trusts exclusively for one or more children without property tax reassessment.

Admittedly, Proposition 19 changed those rules. Starting February 16, 2021, the ability for a parent to transfer to heirs up to $1,000,000 in assessed value of a home or real property of any kind that is NOT being used as a primary residence – is no longer possible in most cases.

Previous ability for a beneficiary or heir to avoid property tax reassessment of inherited property that is not being used as a primary residence by the parent, i.e., the decedent, or by the beneficiary or heir inheriting the property – no longer exists; unless things change.  In other words – inherited real estate being used as investment property, and rented out to vacationers, is no longer possible.

However, the process of inheriting property while keeping a low property tax base with the use of a trust loan from a trust lender, while buying out a sibling’s inherited property shares is still very much alive and well in California.  You simple  need to know how to take advantage of the system properly.

So to reiterate, the transfer of a non-primary residence now must be reassessed at what attorneys call “fair market value”, simply meaning current high property tax rates… Except when beneficiaries are using the residence as a primary or principal residence; and the current property tax rate of the residence at the time of transfer does not exceed the parent or decedent’s so-called “assessed value” by more than $1,000,000.  

Assembly Constitutional Amendment 9: Efforts to Reinstate Prop 19

If the inherited residence exceeds the assessed value by more than $1,000,000 the inherited property’s assessed value will be assessed at current market rates – minus $1,000,000.  And these changes are what Jon Coupal at the Howard Jarvis Taxpayer’s Association and political friends of theirs are trying to walk back or permanently stall with their Assembly Constitutional Amendment 9 (i.e., ACA 9), introduced by the young CA Assemblyman, Mr. Kevin Kiley.

 

 

Is a Parent to Child Transfer Still Relevant for CA Beneficiaries & Homeowners?

Parent to Child Property Tax Transfer

Parent to Child Property Tax Transfer

In a Pandemic depressed economy, with a tsunami of unemployed and under-employed workers floating around in every state… it’s obvious that middle class working  families need to save more… and spend less – on items not classified as necessary for survival.  Property taxes being one of those sort of artificial expenses imposed on citizens by the government.

One solution for this dilemma is property tax relief, which we talk about at length on this blog.  Why not institute genuine property tax relief, not tax deferment as the state government has suggested, moving payment dates around.  Clearly ineffective in a crisis like the one we’re in right now.  California needs expanded property tax relief that’s even more wide reaching than  what we have now.  

We should be building on what we already have – not watering it down!  Despite property tax breaks that no other state has, California could use expanded tax breaks from Proposition 19, to help homeowners establish an even lower property  tax base, saving residents even more during  a crisis like the pandemic we’re in right now.  With an even greater ability to resolve inherited property conflicts between beneficiaries as well. 

In other words, a beneficiary buyout of co-beneficiary property shares, while avoiding property tax reassessment, can be re-drawn so there is no 12-month deadline for beneficiaries to follow… Plus the ability to avoid property tax reassessment on certain investment properties that have revenue potential. 

Residents need more opportunities in a depressed economy like we’re in now to drive revenue, not less.  Solutions like inheriting property taxes in California 2021 need to be expanded statewide, and legally strengthened. Solutions and firms like that will help beneficiaries & homeowners buyout a sibling’s share of an inherited home as an investment property to rent out, not just to live in as a primary residence.

Every property owner should understand the details underlying Prop 19, and know what’s involved with a beneficiary buyout of sibling property shares, or “transfer of property between siblings”, and “lending money to an irrevocable trust“ – from an irrevocable trust lender.  Every California homeowner and beneficiary inheriting property should know how a sibling to sibling property transfer works; keeping yearly taxes on property at parents low rates; and inheriting property taxes in California 2021.

Only California allows this, so it’s worth taking a closer look, and taking full advantage of.  Take a look at the site managed by CA State Board of Equalization, at and research property tax breaks  and Proposition 19 property tax relief revisions at Loan to a Trust  and read up on updates to Proposition 19 at this blog, Property Tax News.    There are also property tax consultants to learn from  such as  property tax specialist Michael Wyatt Consulting who are experts at property tax breaks that save homeowners, commercial property owners, and beneficiaries inheriting property thousands of dollars if not tens of thousands of dollars every year.   

The well known president of Commercial Loan Corp, Kerry Smith is another expert to learn from, or to receive a trust loan from, if the need is there.  Trust and Estate Loans is another source of excellent material, if you want to learn more about establishing a low base property tax rate through a trust loan, and Californians ability to execute a transfer of parents’ property and transfer of parents property taxes when inheriting parents property and inheriting property taxes during a property tax transfer with your parents’ low property tax base. If you’re going to own property in California, it’s worth it to know about your ability to avoid property tax reassessment, and to keep parents property taxes.  Well worth it!  

The California Proposition 19 Newspaper Debate

California Proposition 19

California Proposition 19


The official California  “Voter Guide” (Official Voter Information Guide) tells us CA Proposition 19 actually protects Proposition 13 property tax savings; and “closes unfair tax loopholes used by wealthy out-of-state investors” — a subtle reference to East Coast investors, of which in reality there are relatively few families like this actually coming to California to inherit property from parents, under Proposition 13, and rent out to wealthy tourists. 

This exaggerated claim has already been dis-proven, yet folks that support Prop 19  and continuously question property tax relief and Proposition 13, continue to repeat this false claim in the media — even though most CA property owners back Prop 13 and Proposition 58.

Newspapers have weighed in recently on Proposition 19: in terms of support…  

• San Mateo Daily Journal: “This would enable people in high cost areas to move more easily, opening up room for new residents to the area.”

• The San Diego Union-Tribune: “While critics see this as a gift to the wealthy elderly, the great majority of older homeowners are middle-income, not rich. Allowing them (as well as disabled homeowners and wildfire or disaster victims) to downsize without suffering a huge property tax hit is a humane policy that helps people retire with much less financial stress. It would also promote fluidity in home sales, increasing the availability of larger homes for families with children and easing the phenomenon of Proposition 13 depressing the real estate free market by trapping empty-nesters in homes bigger than they need.”

And in opposition…

• Tahoe Daily Tribune: “It’s no secret that ballot initiatives can be confusing, but Proposition 19 takes obfuscation to a whole new level.  Voters can’t be blamed if they can’t remember whether Prop. 19 is the initiative that is a massive property tax hike or the measure that actually has something good for homeowners or the initiative that has something to do with firefighting. The fact is, all three are at least somewhat true — especially the part about the big tax increase.”

• Mercury News & East Bay Times Editorial Boards: “Prop. 19 merely plugs one hole in the state’s porous property tax laws while creating another. It’s time for holistic reform that simplifies the system and makes it more equitable. This isn’t it. The longer a person had owned their current home, and already benefited from inordinately low tax bills due to Prop. 13, the greater the tax break on the new property. And those who downsize would often be competing with first-time buyers for more-affordable smaller homes. The real reform would be to abolish the tax-transfer program, not expand it.”

• The Bakersfield Californian Editorial Board: “Proposition 19 is another do-over on the ballot. Two years ago, the real estate industry spent $13 million on a similar initiative campaign to expand the program statewide and enhance the benefit for eligible homeowners. Sixty percent of voters rejected the initiative.”

• Los Angeles Times Editorial Board: “But Proposition 19 would just expand the inequities in California’s property tax system. It would grossly benefit those who were lucky enough to buy a home years ago and hold onto it as values skyrocketed. It would give them a huge tax break and greater buying power in an already expensive real estate market. It would skew tax breaks further away from people who don’t own a home or who may be struggling to buy one.”

• San Francisco Chronicle Editorial Board: “[Proposition 19] is still a flawed package, designed to rev up home sales that benefit real estate agents who could reap more in commissions. It favors one narrow segment of the tax-paying public but does nothing for the rest of the state’s home buyers. The measure shows the convoluted extremes that California’s tangled property tax system produces.”

Whichever way you see it, it’s fairly clear that Proposition 19 is a billion-dollar tax increase on families. It limits one of the best tools parents have to help their children — the right, enshrined in California’s Constitution since 1986, to pass their home and other property on without any increase in property taxes, as a Proposition 19 parent to child transfer.

On the other hand, Proposition 19 still allows residents to avoid property tax reassessment, as long as families move into inherited property inside 12 months, and only as a primary residence. 

California beneficiaries inheriting property from parents can still work with trust lenders to get a loan to a trust you can also get a trust loan to buyout co-beneficiaries, while locking in a low property tax base… You can still easily buyout co-beneficiaries with a transfer of property between siblings.  Beneficiaries can always take advantage of a property tax transfer — in other words, transfer parents’  property taxes to themselves under Prop 19, what used to be Prop 58… and keep parents property taxes after inheriting property, and inheriting property taxes,  for as long as they live in their inherited home… as a standard Proposition 19 parent to child transfer or parent to child exclusion from current property tax rates. 

Moreover, Prop 19 will in fact generate additional property tax revenue, that will supposedly be put to good use in the state of California. So, it cuts both ways.