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Written by:
Numerics CPA
Numerics CPA
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Published on:
September 15, 2025
9/15/25
Inheriting a Family Home? Read This First.
Imagine inheriting your family home, a place filled with memories and meaning, only to find out your property taxes just skyrocketed. What happened?
Welcome to the world of Proposition 19, a California law that changed the game for inherited property taxes.
What Is Prop 19?
Passed by voters in 2020 and effective as of February 16, 2021, Proposition 19 dramatically changed how inherited homes are taxed in California.
Before Prop 19, you could inherit property from a parent or grandparent and keep their low property tax rate, even if you didn’t live there.
Now? Not so easy.
To keep that low tax rate, all of the following must be true:
The home was your parent’s primary residence.
You move in and make it your own primary residence within one year of the transfer.
If you don’t plan to live there, the property will be reassessed at current market value—which usually means much higher taxes.
Why It Matters
Let’s say your parents bought their home for $200,000 and the assessed value stayed low. Today, it’s worth $1.5 million.
Before Prop 19, you could inherit the home and continue paying taxes based on that original value. Now, unless you move in and follow the rules, you’re likely facing a huge property tax hike.
This change has affected:
Families who planned to keep the home as a rental or vacation property.
Heirs who can’t afford the increased tax bill and are forced to sell.
Are There Any Workarounds?
If you’ve inherited a home in California and want to avoid reassessment, here are a few potential strategies:
Move In ASAP
You must establish the home as your primary residence within one year of inheritance to qualify for the exclusion.
Sell Quickly
If you don’t want to move in, consider selling the home as soon as possible. Waiting too long can lead to retroactive reassessment and tax penalties.
Check for Special Exemptions
You might qualify for a delay or exclusion if you:
Are under 18
Have a disability
Are on active military duty
Use the Prop 58/193 Exclusion
This older rule still allows an exclusion of up to $1 million in additional value, but only if:
You use the property as your primary residence, and
You meet other qualification requirements
How Reassessment Works (With an Example)
Even if you meet all the conditions, you could still face a partial reassessment if the home’s market value is more than $1 million higher than the original tax base.
Here’s how it breaks down:
Parent’s assessed value: $300,000
Market value at inheritance: $1.5 million
$1 million exclusion applies
New taxable value: $500,000
Calculation:
$1.5M (market) – $1.3M (original value + $1M exclusion) = $200,000
Add that to the original $300,000 = $500,000 new assessed value
You’re still getting a break—but not as much as before.
How to Apply for the Parent-Child Exclusion
To qualify for the lower tax rate, here’s what you need to do:
Move in within one year of the transfer.
File a homeowner’s or disabled veteran’s exemption claim with your County Assessor’s Office.
Submit the official form:
Claim for Reassessment Exclusion for Transfer Between Parent and Child (Form BOE-19-P)
You can usually find this on your County Assessor's website.
Who’s Hit Hardest by Prop 19?
Wealthy Heirs
Families who inherit high-value homes and want to use them as vacation homes or rentals are the most affected. Those properties now face full reassessment.
Property-Rich, Cash-Poor Families
Families in gentrified neighborhoods with high-value homes but limited income may be forced to sell if they can’t cover the higher property taxes.
Summary of Changes
Criteria | Before Prop 19 | Now |
|---|---|---|
Which Properties Qualify | You could inherit your parent’s primary home plus up to $1 million in other real estate (like rentals or vacation homes) without a tax hike. | Only the primary residence (or a family farm) qualifies. No more tax breaks for rentals, vacation homes, or commercial properties. |
Do You Have to Live in the Home? | No. You didn’t have to live there to keep the low tax rate. | Yes. You must move in within one year and claim a homeowner’s exemption—or the home gets reassessed at full market value. |
Is There a Value Limit? | No limit on how valuable the home could be. | If the home’s value is over $1 million more than your parent’s original tax base, the excess gets added to your tax bill. (The $1M cap adjusts with inflation.) |
What About Grandparents? | You can still inherit from a grandparent if your parents are deceased—but now you also have to meet the residency rule. | Prop 19 keeps some benefits—but it’s much stricter. If you want to keep a low property tax rate, you’ll probably need to move in and act fast. |
Final Thoughts
Prop 19 was created to close loopholes and generate more tax revenue for wildfire response and other state programs. But for many California families, it’s created unexpected complications and financial pressure, at an already emotional time.
If you’re inheriting property or planning for your estate, take time to understand how Prop 19 works. Knowing your options can help you make smart decisions and potentially save a lot of money.
Need Help Navigating Prop 19?
It’s always a good idea to consult a real estate attorney or tax advisor who specializes in California property law. Every family’s situation is different, and the right guidance can make all the difference.
Have questions or want help planning your next move? Check out the FAQ with the California State Board of Equalization. For additional guidance, please go ahead and book a free consultation below. We’re here to help!
Inheriting a Family Home? Read This First.
Imagine inheriting your family home, a place filled with memories and meaning, only to find out your property taxes just skyrocketed. What happened?
Welcome to the world of Proposition 19, a California law that changed the game for inherited property taxes.
What Is Prop 19?
Passed by voters in 2020 and effective as of February 16, 2021, Proposition 19 dramatically changed how inherited homes are taxed in California.
Before Prop 19, you could inherit property from a parent or grandparent and keep their low property tax rate, even if you didn’t live there.
Now? Not so easy.
To keep that low tax rate, all of the following must be true:
The home was your parent’s primary residence.
You move in and make it your own primary residence within one year of the transfer.
If you don’t plan to live there, the property will be reassessed at current market value—which usually means much higher taxes.
Why It Matters
Let’s say your parents bought their home for $200,000 and the assessed value stayed low. Today, it’s worth $1.5 million.
Before Prop 19, you could inherit the home and continue paying taxes based on that original value. Now, unless you move in and follow the rules, you’re likely facing a huge property tax hike.
This change has affected:
Families who planned to keep the home as a rental or vacation property.
Heirs who can’t afford the increased tax bill and are forced to sell.
Are There Any Workarounds?
If you’ve inherited a home in California and want to avoid reassessment, here are a few potential strategies:
Move In ASAP
You must establish the home as your primary residence within one year of inheritance to qualify for the exclusion.
Sell Quickly
If you don’t want to move in, consider selling the home as soon as possible. Waiting too long can lead to retroactive reassessment and tax penalties.
Check for Special Exemptions
You might qualify for a delay or exclusion if you:
Are under 18
Have a disability
Are on active military duty
Use the Prop 58/193 Exclusion
This older rule still allows an exclusion of up to $1 million in additional value, but only if:
You use the property as your primary residence, and
You meet other qualification requirements
How Reassessment Works (With an Example)
Even if you meet all the conditions, you could still face a partial reassessment if the home’s market value is more than $1 million higher than the original tax base.
Here’s how it breaks down:
Parent’s assessed value: $300,000
Market value at inheritance: $1.5 million
$1 million exclusion applies
New taxable value: $500,000
Calculation:
$1.5M (market) – $1.3M (original value + $1M exclusion) = $200,000
Add that to the original $300,000 = $500,000 new assessed value
You’re still getting a break—but not as much as before.
How to Apply for the Parent-Child Exclusion
To qualify for the lower tax rate, here’s what you need to do:
Move in within one year of the transfer.
File a homeowner’s or disabled veteran’s exemption claim with your County Assessor’s Office.
Submit the official form:
Claim for Reassessment Exclusion for Transfer Between Parent and Child (Form BOE-19-P)
You can usually find this on your County Assessor's website.
Who’s Hit Hardest by Prop 19?
Wealthy Heirs
Families who inherit high-value homes and want to use them as vacation homes or rentals are the most affected. Those properties now face full reassessment.
Property-Rich, Cash-Poor Families
Families in gentrified neighborhoods with high-value homes but limited income may be forced to sell if they can’t cover the higher property taxes.
Summary of Changes
Criteria | Before Prop 19 | Now |
|---|---|---|
Which Properties Qualify | You could inherit your parent’s primary home plus up to $1 million in other real estate (like rentals or vacation homes) without a tax hike. | Only the primary residence (or a family farm) qualifies. No more tax breaks for rentals, vacation homes, or commercial properties. |
Do You Have to Live in the Home? | No. You didn’t have to live there to keep the low tax rate. | Yes. You must move in within one year and claim a homeowner’s exemption—or the home gets reassessed at full market value. |
Is There a Value Limit? | No limit on how valuable the home could be. | If the home’s value is over $1 million more than your parent’s original tax base, the excess gets added to your tax bill. (The $1M cap adjusts with inflation.) |
What About Grandparents? | You can still inherit from a grandparent if your parents are deceased—but now you also have to meet the residency rule. | Prop 19 keeps some benefits—but it’s much stricter. If you want to keep a low property tax rate, you’ll probably need to move in and act fast. |
Final Thoughts
Prop 19 was created to close loopholes and generate more tax revenue for wildfire response and other state programs. But for many California families, it’s created unexpected complications and financial pressure, at an already emotional time.
If you’re inheriting property or planning for your estate, take time to understand how Prop 19 works. Knowing your options can help you make smart decisions and potentially save a lot of money.
Need Help Navigating Prop 19?
It’s always a good idea to consult a real estate attorney or tax advisor who specializes in California property law. Every family’s situation is different, and the right guidance can make all the difference.
Have questions or want help planning your next move? Check out the FAQ with the California State Board of Equalization. For additional guidance, please go ahead and book a free consultation below. We’re here to help!
Inheriting a Family Home? Read This First.
Imagine inheriting your family home, a place filled with memories and meaning, only to find out your property taxes just skyrocketed. What happened?
Welcome to the world of Proposition 19, a California law that changed the game for inherited property taxes.
What Is Prop 19?
Passed by voters in 2020 and effective as of February 16, 2021, Proposition 19 dramatically changed how inherited homes are taxed in California.
Before Prop 19, you could inherit property from a parent or grandparent and keep their low property tax rate, even if you didn’t live there.
Now? Not so easy.
To keep that low tax rate, all of the following must be true:
The home was your parent’s primary residence.
You move in and make it your own primary residence within one year of the transfer.
If you don’t plan to live there, the property will be reassessed at current market value—which usually means much higher taxes.
Why It Matters
Let’s say your parents bought their home for $200,000 and the assessed value stayed low. Today, it’s worth $1.5 million.
Before Prop 19, you could inherit the home and continue paying taxes based on that original value. Now, unless you move in and follow the rules, you’re likely facing a huge property tax hike.
This change has affected:
Families who planned to keep the home as a rental or vacation property.
Heirs who can’t afford the increased tax bill and are forced to sell.
Are There Any Workarounds?
If you’ve inherited a home in California and want to avoid reassessment, here are a few potential strategies:
Move In ASAP
You must establish the home as your primary residence within one year of inheritance to qualify for the exclusion.
Sell Quickly
If you don’t want to move in, consider selling the home as soon as possible. Waiting too long can lead to retroactive reassessment and tax penalties.
Check for Special Exemptions
You might qualify for a delay or exclusion if you:
Are under 18
Have a disability
Are on active military duty
Use the Prop 58/193 Exclusion
This older rule still allows an exclusion of up to $1 million in additional value, but only if:
You use the property as your primary residence, and
You meet other qualification requirements
How Reassessment Works (With an Example)
Even if you meet all the conditions, you could still face a partial reassessment if the home’s market value is more than $1 million higher than the original tax base.
Here’s how it breaks down:
Parent’s assessed value: $300,000
Market value at inheritance: $1.5 million
$1 million exclusion applies
New taxable value: $500,000
Calculation:
$1.5M (market) – $1.3M (original value + $1M exclusion) = $200,000
Add that to the original $300,000 = $500,000 new assessed value
You’re still getting a break—but not as much as before.
How to Apply for the Parent-Child Exclusion
To qualify for the lower tax rate, here’s what you need to do:
Move in within one year of the transfer.
File a homeowner’s or disabled veteran’s exemption claim with your County Assessor’s Office.
Submit the official form:
Claim for Reassessment Exclusion for Transfer Between Parent and Child (Form BOE-19-P)
You can usually find this on your County Assessor's website.
Who’s Hit Hardest by Prop 19?
Wealthy Heirs
Families who inherit high-value homes and want to use them as vacation homes or rentals are the most affected. Those properties now face full reassessment.
Property-Rich, Cash-Poor Families
Families in gentrified neighborhoods with high-value homes but limited income may be forced to sell if they can’t cover the higher property taxes.
Summary of Changes
Criteria | Before Prop 19 | Now |
|---|---|---|
Which Properties Qualify | You could inherit your parent’s primary home plus up to $1 million in other real estate (like rentals or vacation homes) without a tax hike. | Only the primary residence (or a family farm) qualifies. No more tax breaks for rentals, vacation homes, or commercial properties. |
Do You Have to Live in the Home? | No. You didn’t have to live there to keep the low tax rate. | Yes. You must move in within one year and claim a homeowner’s exemption—or the home gets reassessed at full market value. |
Is There a Value Limit? | No limit on how valuable the home could be. | If the home’s value is over $1 million more than your parent’s original tax base, the excess gets added to your tax bill. (The $1M cap adjusts with inflation.) |
What About Grandparents? | You can still inherit from a grandparent if your parents are deceased—but now you also have to meet the residency rule. | Prop 19 keeps some benefits—but it’s much stricter. If you want to keep a low property tax rate, you’ll probably need to move in and act fast. |
Final Thoughts
Prop 19 was created to close loopholes and generate more tax revenue for wildfire response and other state programs. But for many California families, it’s created unexpected complications and financial pressure, at an already emotional time.
If you’re inheriting property or planning for your estate, take time to understand how Prop 19 works. Knowing your options can help you make smart decisions and potentially save a lot of money.
Need Help Navigating Prop 19?
It’s always a good idea to consult a real estate attorney or tax advisor who specializes in California property law. Every family’s situation is different, and the right guidance can make all the difference.
Have questions or want help planning your next move? Check out the FAQ with the California State Board of Equalization. For additional guidance, please go ahead and book a free consultation below. We’re here to help!
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