Hundreds of San Diegans face higher property tax bills due to a new California law
In 2020, California voters passed Proposition 19, which brought about an amendment to the state constitution, resulting in a change in the calculation of property taxes for numerous San Diegans.
If you’re 55 years or older, you can maintain your current tax rate on your home after selling it and purchasing a new one, in most situations. The new law permits individuals over 55 to do this up to three times.
To achieve a net boost in property taxes across the state, the benefits of property tax on inherited properties have been restricted in recent times.
According to Jordan Marks, the Assessor of San Diego County, Prop 19 has brought about significant changes to our property tax system in two ways.
Marks highlighted the significance of the parent-to-child transfer, which has been a vital tool for building wealth in the community. He also emphasized that it has been instrumental in preserving communities of interest, particularly for those who cannot afford to stay in their current location due to rising property taxes. Unfortunately, the inability to keep up with these expenses has led to gentrification and the displacement of many communities.
Previously, one had the privilege of retaining the property taxes on any inherited home or business, including second homes, vacation homes, rental homes, and businesses, before the implementation of Prop 19.
If you inherit a home from your parent or grandparent and make it your primary residence, you can retain the original property taxes for up to $1 million in value. However, if you decide to move out and convert the property into a rental, the home will be reevaluated, and a new rate will be charged based on the updated value.
Marks has discovered that maintaining the same tax rate can be quite demanding. To preserve the tax rate, it is essential to submit the necessary documents to the county’s tax assessor’s office within a year of the demise of your loved one.
Marks emphasized the importance of taking the time to sort through family issues when it comes to cleaning out a parent’s house. In some cases, it may not be clear who will inherit the house, which can lead to confrontations. It’s important to consider the implications of moving into the house as a primary residence, as this could result in a significant increase in taxes. It’s crucial to take a thoughtful and strategic approach to these situations.
According to Marks, he has witnessed a significant rise in property tax bills, soaring from $1,600 annually to a staggering $10,000 per year due to the new law. In the past year, his office has received numerous inquiries from hundreds of San Diegans who have also experienced a sudden increase in their bills.
To prevent San Diegans from experiencing sudden increases on their property tax bills, the assessor’s office is taking a proactive approach by educating the public about the new law. Mortuaries are being contacted and provided with a checklist of necessary paperwork that families need to fill out. This effort aims to ensure that everyone is aware of the requirements and can avoid any unexpected financial burden.
A program, known as Navigating Loss Program, has been introduced by the office. This program will guide the family members through the required steps of the online process.
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