Proposition 13 prohibited property tax increases until property ownership is changed.
If either spouse is over age 55, PROP 60 allows replacement of a primary residence with a new home of equal or lesser value within the same county and transfer of the Prop 13 assessed valuation from the old home to the new property. This is allowed once in your lifetime, and a spouse who has done it before 'taints' both spouses.
PROP 90 allows counties to elect to accept transfers of Prop 13 values for moves from other counties when a primary residence is replaced with a less expensive home. If you are over 55 and move into a county that accepts Prop 90, you may take your old, lower Prop 13 value, regardless of from which county you move.
Using Prop 90, you can sell your $700,000 Los Angeles home [assessed value $250,000] and move to a new $600,000 home in Ventura; the new Ventura assessed value will be $250,000!
7 COUNTIES WHICH ACCEPT PROP 90
(Current as of 6/1/2005)
Alameda, Los Angeles, Orange, San Diego, San Mateo, Santa Clara, and Ventura.
Props 60 and 90 only apply if you "trade down."
If you buy New Home 1st; then sell the Old Home, you must go down in price.
If you sell the Old Home 1st; then buy the New Home: In the 1st 365 days after the sale of Old Home, you may increase 5% in the purchase price of New Home.
If you buy New Home more than 1 year from the sale of Old Home, but less than 2 years, you increase 10%. |
"Wow, you're kidding!
I didn't know I wouldn't increase my property taxes by selling my long-term residence and buying a place more suitable for us now."
For more information:
State Board of Equalization, California
http://www.boe.ca.gov/proptaxes/faqs/reappraisal.htm
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