Proposition 60 & 90
How can these new laws benefit you?
Guidelines for the transfer of the Property Tax Base from one principal place of residence to another principal place of residence in the county only.
One of the property owners must be at least 55 years old
on the day of transfer of the principal place of residence.
The transfer of the subsequent (new) principal place of residence must be complete within two years of the transfer date of the first principal place of residence (for example: closed escrow, purchased, etc. etc.)
The purchase price of the subsequent principal place of residence must not exceed the sales price of the original property except for the following:
(1) A five percent inflation allowance is allowed if the subsequent purchase is less than one year from sale date of the original place of residence.
(2) A ten percent inflation allowance is allowed if subsequent purchase is at least one year and one day but less than two
years from the sale date of the original place of residence.
ALL PROP. 60 TRANSACTIONS MUST BE COMPLETED WITHIN TWO YEARS!!
Proposition 90 will allow the inter-county transfer of the property tax base if the county supervisors have approved it.
For further information contact your local county assessor’s office.
Guidelines for propositions 60 & 90 if the homeowner wishes to purchase a new principal place of residence prior to the completion of the sale of his original principal place of residence.
There is no inflation allowance if a new principal place of residence is purchased first!!
EXAMPLE:
Home is purchased under proposition 60 & 90 for the amount of $200,000 before the sale is completed on the original home. (DEED RECORDED).
The homeowner must be certain the original home where the property taxes are being transferred from will sell for at least the purchased price of his new principal place of residence, $200,000 or more in this example.
If the original home in this example did not sell for at least $200,000, the homeowner would not be able to transfer his lower property taxes to his new home.
It is always a safer situation if the homeowner sells his principal place of residence first since he would then know exactly what options he would have.
[R E M I N D E R]
Remember, if you purchase a replacement principal place of residence prior to closing escrow on the residence you want to transfer your tax base from, you do not have an inflation allowance. Your former home must sell for at least what is being paid for the replacement residence
Counties That Have Approved Proposition 90
MODOC 916-233-3939
**Please consult your tax consultant for a tax opinion.
