Navigating California’s Proposition 60/90/110: A County-by-County Guide to Property Tax Transfer

So, you’re eyeing that sun-drenched bungalow in a new location, or perhaps downsizing after years in the family home? Excellent! But a major question looms: Can you take your existing property tax rate with you? The answer, as with many things in California real estate, is layered and depends heavily on which county you’re dealing with.

Here’s the crucial piece: As of today, April 25, 2024, all California counties allow property tax transfer under Proposition 60 (for seniors 55 and older within the same county) and Proposition 110 (for severely disabled individuals). However, Proposition 90, which allows for intercounty transfers, is where the variations lie. Currently, only ten counties in California accept base-year property tax transfers from other counties under Proposition 90: Alameda, El Dorado, Los Angeles, Marin, Monterey, Orange, San Diego, San Mateo, Santa Clara, and Ventura.

Let’s delve deeper into these propositions and arm you with the knowledge you need to navigate this complex landscape.

Understanding Propositions 60, 90, and 110

California’s Proposition 13, passed in 1978, dramatically limited property tax increases. But it also created a situation where long-time homeowners could be penalized if they moved, facing a significant tax hike on their new property. Enter Propositions 60, 90, and 110, designed to offer relief.

• Proposition 60: This allows homeowners aged 55 and older to transfer their existing property tax base to a replacement dwelling within the same county. The replacement property must be of equal or lesser value than the original property. This proposition is accepted in all California counties.

• Proposition 90: This is the key to intercounty transfers. It allows qualified homeowners (also 55 and older) to transfer their property tax base to a replacement dwelling in a different California county. The catch? The receiving county must have enacted an ordinance to accept such transfers. This is where the availability dramatically varies. Currently, only ten counties accept Proposition 90 transfers: Alameda, El Dorado, Los Angeles, Marin, Monterey, Orange, San Diego, San Mateo, Santa Clara, and Ventura.

• Proposition 110: This extends the property tax transfer benefit to severely and permanently disabled persons, regardless of age. Similar to Proposition 60, the transfer is within the same county, and the replacement dwelling must be of equal or lesser value. All California counties accept Proposition 110 transfers.

The Critical Role of County Ordinances

The power to accept or reject intercounty property tax transfers lies firmly with each individual county. This authority is derived from Proposition 90. A county must specifically enact an ordinance to participate in the program. Consequently, if a county has not adopted such an ordinance, a homeowner cannot transfer their existing property tax base to that county, even if they meet all other eligibility requirements.

This system creates a patchwork of acceptance across the state, demanding that individuals research the specific policies of both the county they are selling their property in and the county they are considering moving to. It’s a detail that can significantly impact your financial planning!

Strategies for Navigating the System

Given the complexities, what strategies can you employ to successfully navigate this system?

• Do your homework: Start by verifying whether the county you’re interested in accepts Proposition 90 transfers. Contact the county assessor’s office directly. Don’t rely solely on outdated online information. Things can change.

• Plan ahead: The process can take time. Begin your research well in advance of your move. Familiarize yourself with the application process and gather all necessary documentation.

• Consider alternative locations: If your desired county doesn’t accept Proposition 90 transfers, explore nearby counties that do. Sometimes, a slightly different location can make a significant financial difference.

• Consult with a professional: Real estate attorneys and experienced real estate agents specializing in senior transitions can provide invaluable guidance and support.

Frequently Asked Questions (FAQs)

Let’s address some common questions about property tax transfer in California:

1. What does “equal or lesser value” mean in the context of Propositions 60/90/110?

“Equal or lesser value” generally means that the market value of the replacement property cannot exceed 105% of the market value of the original property if purchased within the first year. It can be 110% if purchased in the second year. This value is typically determined by the county assessor.

2. How long do I have to purchase a replacement property after selling my original property?

Generally, you have two years from the date of sale of your original property to purchase or construct a replacement property.

3. Can I transfer my property tax base more than once?

No. Propositions 60 and 90 allow for a one-time transfer only.

4. What if I inherit a property? Can I transfer the property tax base from my previous home?

Inherited properties generally do not qualify for property tax base transfer under Propositions 60, 90, or 110. Specific rules apply to inherited properties under Proposition 58 and Proposition 19, but these are different scenarios.

5. If I own multiple properties, can I choose which property tax base to transfer?

You can only transfer the property tax base from the property you are selling as your primary residence to your replacement primary residence.

6. How do I apply for a property tax base transfer?

You must file the necessary application forms with the county assessor’s office in the county where you are purchasing the replacement property. Each county may have slightly different forms or procedures, so contact the county assessor’s office.

7. What happens if I move to a county that doesn’t accept Proposition 90 transfers?

You will be reassessed at the current market value of the new property, and your property taxes will be based on that assessed value.

8. Does Proposition 19 affect Propositions 60, 90, or 110?

Yes, Proposition 19, passed in 2020, significantly altered the rules regarding property tax transfers. While Propositions 60, 90, and 110 remain in place, Proposition 19 narrowed the eligibility requirements and limitations on transfers, particularly for intra-family transfers. It’s crucial to understand the implications of Proposition 19 alongside the other propositions.

9. What if my replacement property is newly constructed?

The same rules apply regarding equal or lesser value and the two-year timeframe. However, you must also provide documentation related to the construction costs.

10. If I am severely disabled, do I have the same time constraints as someone using Proposition 60?

Yes, the two-year timeframe generally applies to Proposition 110 as well.

11. Are there any income limitations to qualify for Propositions 60, 90, or 110?

No, there are no income limitations to qualify for these propositions based solely on age or disability. The primary requirements focus on age (55+), disability status, property values, and timelines.

12. Where can I find the most up-to-date information on county participation in Proposition 90?

The best source of information is the county assessor’s office in the county you are considering moving to. You can also consult the California State Board of Equalization (BOE) website, although county-specific information is often most accurate at the local level.

Conclusion

Navigating California’s property tax transfer rules requires careful planning and a thorough understanding of the relevant propositions and county ordinances. By doing your research, seeking professional advice, and understanding your eligibility, you can maximize your chances of successfully transferring your property tax base and enjoying a more affordable retirement or transition to a new home. Don’t leave it to chance; arm yourself with knowledge and make informed decisions. Good luck!