Proposition 19, also known as the Home Protection for Seniors, Severely Disabled, Families, and Victims of Wildfire or Natural Disasters Act, is a significant piece of legislation that has implications for property owners in California. Passed in November 2020, it brings changes to property tax assessment rules and inheritance laws. Let’s break down what Proposition 19 entails and what it means for Californians.

What is Proposition 19?
Proposition 19 is a California ballot measure aimed at making changes to property tax rules and inheritance laws. It has two main components:

1. Property Tax Transfers: Proposition 19 allows eligible homeowners who are over 55 years old, severely disabled, or victims of wildfires or natural disasters to transfer the tax assessments of their primary residence to a replacement residence anywhere in California. This means they can move to a new home without facing significant increases in property taxes.

2. Inheritance Rules: Proposition 19 changes the rules regarding the transfer of property tax assessments for inherited properties. Under the new law, inherited properties that are not used as the primary residence or are used for commercial purposes will be reassessed at market value when transferred to children or grandchildren. However, inherited primary residences may be eligible for the property tax transfer benefit if certain conditions are met.

What Does Proposition 19 Mean for Californians?
1. Benefits for Seniors and Disabled: Proposition 19 provides older homeowners and individuals with disabilities more flexibility to move while keeping their property tax assessments low. This can make it easier for them to downsize, relocate for health reasons, or move closer to family members without facing a significant increase in property taxes.

2. Impact on Inherited Properties: Proposition 19 changes the way inherited properties are taxed in California. While it provides some tax benefits for inherited primary residences, it may result in higher property taxes for inherited properties that are not used as primary residences or are used for commercial purposes.

3. Revenue for Fire Protection: Proposition 19 allocates additional revenue generated from the changes to property tax assessments to fund wildfire prevention efforts and support local governments and fire districts.

For more information on the effects of Proposition 19, see some helpful charts here.

Proposition 19 brings significant changes to property tax assessment rules and inheritance laws in California. While it offers benefits for seniors, individuals with disabilities, and victims of wildfires or natural disasters, it also has implications for inherited properties. Understanding how Proposition 19 affects you as a homeowner or potential inheritor is crucial for making informed decisions regarding property ownership and transfers in the state of California.