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Key Updates & Prop 19

Priorities

• Assessment Appeals • Goal to Roll • SMART (System for Management, Assessments, Records and Transactions) • Community Engagement: Pursuing Social and Economic Justice

^Disclaimer

^{The information provided is intended to provide general information about Proposition 19. It is not intended to be a legal interpretation or official guidance, or relied upon for any purpose, but is instead a presentation of summary information. Proposition 19 is a constitutional amendment, so additional legislation, regulations, and statewide guidance are expected to clarify its implementation. If there is a conflict between the information provided here and the proposition or any legal authorities implementing or interpreting the proposition, the text of the proposition and the other implementing or interpretive authorities will prevail. We encourage you to consult an attorney for advice on your specific situation.}

Property Tax in CA- Proposition 13
Constitutional Amendment (1978) Article XIII A

Property Tax Rate = ~1%

Assessment value increase capped at 2%

Assessed Value

Assessed Value is fair market value at the time of change in ownership.

Setting Assessed Value

Change in Ownership – Reassessment to Market Value

PROPOSITION 19 – Reassessment Exclusions

November 3, 2020 California Constitution Article XIII A, Section 2.1 Base Year Value Transfer Intergenerational Transfer Exclusion

PROP 19: BASE YEAR VALUE TRANSFER

	Allows homeowners to transfer their home's taxable value or factored base year value to a replacement home.
	Anywhere in California, up to three times. No limit to the market value of the replacement property, but any amount over the original property’s market value is added to the assessed value.

Base Year Value Transfer – Who is Eligible?

• Homeowner meets one of the following: - Age 55 or over, - Severely and permanently disabled, or - Victim of wildfire or natural disaster • Replacement home must be purchased or newly constructed within two years of the sale of the original property. • Homeowner must occupy original property and replacement dwelling as principal residence.

Base Year Value Transfer – Filing Period

• Three (3) years after the purchase or completion of construction of replacement dwelling • Prospective relief available Beginning with the lien date of the assessment in which the claim is filed.

Example: Base Year Value Transfer

New replacement home was purchased on 4/5/2021 at $1,500,000

Original property sold on 8/15/2021 at $1,200,000

Original property's Factored Base Year Value (FBYV) = $250,000

Rule: Excess market value is added to the FBYV

New home exceeds 100% of original home's fair market value.

$1,500,000 (new home) - $1,200,000 (original) = $300,000 (excess)

$300,000 (excess) + $250,000 (FBYV) = $550,000 New Base Year Value

FAQ

Age

Q: I am 54 years old. If I sell my home now and buy the replacement dwelling after I turn age 55, will I be eligible to transfer the base year value?

Answer: No. You must be age 55 or over when you sell your original primary residence to qualify. You may purchase a replacement residence prior to age 55, but you must be age 55 or older on the sale of the original primary residence.

Timing

Divorce

Q: A couple divorces. As part of the divorce, their principal residence was sold. Would each of the owners be able to transfer their share of the base year value to their respective replacement residences?

Answer: No, only one claimant may transfer the original property's base year value. If both parties qualify, they must mutually decide who will get the benefit.

Co-Owners

Type of Relief	Forms to File	Name of Form	Filing Deadlines
Age 55 or Older	BOE-19-B	Claim for Transfer of Base Year Value to Replacement Primary Residence for Persons at Least Age 55 Years	Within 3 years of the date a replacement dwelling is purchased, or new construction of a replacement dwelling is completed.
Severely and Permanently Disabled	BOE-19-D and BOE-19-DC	Claim for Transfer of Base Year Value to Replacement Primary Residence for Severely Disabled Persons, and Certificate of Disability	Within 3 years of the date a replacement dwelling is purchased, or new construction of a replacement dwelling is completed.
Victim of Wildfire or Natural Disaster	BOE-19-V	Claim for Transfer of Base Year Value to Replacement Primary Residence for Victims of Wildfire or Other Natural Disaster	Within 3 years of the date a replacement dwelling is purchased, or new construction of a replacement dwelling is completed.

PROP 19: INTERGENERATIONAL TRANSFERS
- A Family Home is excluded from reassessment to market value when it is transferred between
  
  Parent/child
  
  Grandparent/grandchild
- "Family Home" qualifies. All other Real Property does not qualify.
- Amount of the exclusion is capped at $1M + base year value
Definition of
"Child"
- Born of the parent
- Stepchild, while the relationship exists
- In-law child, while relationship exists
- Adopted child
- Foster child of a state-licensed foster parent

Primary Button

Qualifications

The Family Home must be a principal residence of both the:

• Transferor prior to date of transfer, and

• Transferee within one year of date of transfer
- Must file for exemption within one year
- Must continually use as family home
Family Home – Principal Place of Residence

• Eligible for Homeowners' or Disabled Veterans' Exemption
- The claim form, BOE-266, Claim for Homeowners' Property Tax Exemption is available at www.sfassessor.org
Family Home – Multi-Unit Dwellings

• Only the unit occupied as the Family Home of a multi-unit dwelling qualifies for the exclusion.
- For example, in a four-unit building, the exclusion applies to the one unit that is claimed as the principal residence of the transferor and transferee. The other units would be reassessed at market value as of the transfer date.

• Exception for Accessory Dwelling Units (ADUs)
- ADUs along with the primary residence qualify as a Family home/principal residence.

Filing Requirements

1. Exemption Claim (either the Homeowners' or the Disabled veterans' exemption form)

Must file within 1 year of transfer
Transferee must own or occupy to be eligible

2. Exclusion Claim (Form BOE-19-P or BOE 19-G)

Must file within 3 years of transfer or before transfer to third party, whichever is first
No later than 6 months after notice of supplemental or escape assessment for parent-child transfer
If all deadlines have passed, prospective relief for the lien date of the year claim is filed.

Example: Intergenerational Transfer Exclusion

Parent transfers principal residence to Child on 3/1/2021.

The Child claims the property as their principal residence and files the Homeowner's Exemption form on 2/1/2022.

The BOE-P19-P Reassessment Exclusion form
is also filed on 2/1/2022.

Both claims timely filed Eligible for exclusion as of 3/1/2021
Example: Late Filing

The Parent passes away on 6/15/2021 and the
estate plan leaves the family home to the Child.

Child files Homeowner's Exemption form on 8/2/2022.

^{Reminder: This form should be filed within 1 yr.}

BOE-19-P Exclusion claim form was filed 1/22/2022.

^{Reminder: This form should be filed within 3 yrs.}

Exclusion claim timely filed. Homeowner's claim not filed within 1 year. Eligible for prospective relief.

Reassessed to market value: Supplemental Assessment for 2021-22 fiscal year.
Prospective relief: exclusion applies as of 2022 lien date, for 2022-23 fiscal year.

Reassessment Exclusion – New Value Cap

Rule: Value Cap is the sum of:
$1,000,000 + Factored Base Year Value (FBYV)

Any excess market value is added to the FBYV.

Example: Valuation

Parent passes away and the property is transferred to the Child on 6/2/2021.
The Child timely files both forms.

The Factored Base Year Value is $800,000. Market value is $1,600,000

Value Cap is the sum of $1,000,000 + FBYV $800,000 = $1,800,000

Market Value $1.6M is less than the Value Cap of $1.8M
No adjustment to factored base year value.
Example: New Taxable Value

Parents transfer their home to the Child on 4/3/2021.
Eligible Child timely files both forms.
Factored Base Year Value is $400,000. Market value is $1,600,000

Value Cap is the sum of $1,000,000 + FBYV $400,000 = $1,400,000

Rule: Excess amount beyond the value cap is added to the FBYV.
• Market Value $1,600,000 is greater than Value Cap of $1,400,000
• Excess amount of $200,000 is added to FBYV of $400,000.
• $600,000 is the New Taxable Value as of the transfer date.

FAQ

Trust Distribution – Family Home

Q: My mother's trust leaves her home to me and my two siblings equally. Will this property be subject to reassessment as of our mother's passing?

Answer: For the property to be excluded from reassessment under Prop 19, at least one of the children or qualified heirs must occupy the family home within one year. Both the homeowners' exemption and Prop 19 exclusion claim must be timely filed to qualify for exclusion from reassessment as of the date of death.

LLC – Family Home

Q: I've heard that the parents can set up an LLC with their children and put the house into the LLC. Since ownership doesn't change on the death of the parents, the property isn't reassessed. Is this correct?

Answer: LLCs are not always an automatic avoidance of a reassessment—California property tax laws governing legal entity ownership transfers are complex and should be discussed with a qualified estate planning attorney and financial advisor.

As one example of where a reassessment would occur despite a property being in an LLC is a situation where there is a change in control in which one member gains greater than 50% interest, triggering a 100% reassessment of the property.

What if the Child moves out?

Answer: If another eligible transferee (e.g., sibling) moves into the property within one year of the other moving out (and timely files for the Homeowner's exemption claim form), the exclusion continues.

If no other eligible transferee moves into the property within one year, the exclusion is removed. The property is then reassessed to the fair market value as of the time of transfer.

Intergenerational Transfer Exclusion Prop 19
Filing Requirements Checklist

Type of Relief	Forms to File	Name of Form	Filing Deadlines
Family Home	BOE-261-G or BOE-266	Claim for Disabled Veterans' Property Tax Exemption or Claim for Homeowners' Property Tax Exemption</td	Within 1 year from date of death or transfer. Exclusion will be applied prospectively if filed after 1-year period.
Family Home	BOE-19-P	Claim for Reassessment Exclusion for Transfer Between Parent and Child Occurring on or After February 16, 2021	Within 3 years from date of death or transfer, or before transfer to 3rd party, whichever is earlier.

Intergenerational Transfer Exclusion $1 Million
"Value Cap" Adjustments

Date of Transfer or Change in Ownership	Applicable $1 Million Amount
February 16, 2021 – February 15, 2023	$1,000,000
February 16, 2023 – February 15, 2025	$1,022,600

Prop 19 Repeal?

State constitutional amendment measure by either: 1. A proposed amendment by the State Legislature with 2/3 vote from the Senate and the Assembly OR 2. A citizens’ initiative with valid signatures of registered voters equal to 8% of the number of votes cast for the governor in the last election (Repeal effort failed, Secretary of State 3/4/24)

PROP 19 RESOURCES

California Board of Equalization FAQs and Guidance

• www.boe.ca.gov/prop19/#FAQs

• www.boe.ca.gov/prop19/#Guidance

San Francisco Office of the Assessor-Recorder

• www.sfassessor.org
LOW-COST LEGAL RESOURCES

Housing & Economic Rights Advocates

• www.heraca.org | 510 271-8443, ext. 300

Legal Assistance to the Elderly

• www.laesf.org | (415) 538-3333

Open Door Legal

• www.opendoorlegal.org | (415) 735-4124

BOE Taxpayers' Rights Advocate Office

• www.boe.ca.gov/tra | (415) 735-4124

Assessor's Annual Timeline

Key dates

January 1 – Lien Date
February 15 – Exemptions Deadline
March 31 – Informal Review Deadline
June 30 – Roll Close

Real Property

July – Notice of Assessed Value
October – Tax Bill Arrives
December/April – Tax Bill Due

Business Personal Property and Possessory Interest

July – Notice and Tax Bill Arrives
August – Tax Bill Due

Assessment Appeals Board

Qualifications Required to Become an AAB Member

Eligibility criteria

CA Revenue and Taxation Code Section 1624.05
"a person shall not be eligible for nomination for membership on an AAB unless he or she has a minimum of five years' professional experience in this state as one of the following: certified public accountant or public accountant, licensed real estate broker, attorney, or property appraiser accredited by a nationally recognized processional organization, or property appraiser certified by the Office of the Real Estate Appraiser."
https://sfgov.org/aab

Assessor’s Office Room 190

• City Hall Main Office Hours Mon–Fri, 8 AM – 5 PM • Visit: sfassessor.org • Call: (415) 554-5596 or 311 • Email: assessor@sfgov.org

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Key Updates & Prop 19

Priorities

Disclaimer

Property Tax in CA- Proposition 13 Constitutional Amendment (1978) Article XIII A

Assessed Value

Setting Assessed Value

Change in Ownership – Reassessment to Market Value

PROPOSITION 19 – Reassessment Exclusions

PROP 19: BASE YEAR VALUE TRANSFER

Base Year Value Transfer – Who is Eligible?

Base Year Value Transfer – Filing Period

Example: Base Year Value Transfer

FAQ

Age

Timing

Divorce

Co-Owners

PROP 19: INTERGENERATIONAL TRANSFERS

Definition of "Child"

Qualifications

Family Home – Principal Place of Residence

Family Home – Multi-Unit Dwellings

Filing Requirements

Example: Intergenerational Transfer Exclusion

Example: Late Filing

Reassessment Exclusion – New Value Cap

Example: Valuation

Example: New Taxable Value

FAQ

Trust Distribution – Family Home

LLC – Family Home

What if the Child moves out?

Intergenerational Transfer Exclusion Prop 19 Filing Requirements Checklist

Intergenerational Transfer Exclusion $1 Million "Value Cap" Adjustments

Prop 19 Repeal?

PROP 19 RESOURCES

LOW-COST LEGAL RESOURCES

Assessor's Annual Timeline

Assessment Appeals Board

Assessor’s Office Room 190

We Would Love to Meet You!

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^Disclaimer

Property Tax in CA- Proposition 13
Constitutional Amendment (1978) Article XIII A

Definition of
"Child"

Intergenerational Transfer Exclusion Prop 19
Filing Requirements Checklist

Intergenerational Transfer Exclusion $1 Million
"Value Cap" Adjustments