Prop 19 Planning for California Families

What is Proposition 19?

Prop 19 significantly changed California property tax rules in 2021. Parents can no longer pass down investment property or vacation homes without reassessment. Even primary residences face restrictions unless the child moves in within one year.

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Why Prop 19 Matters for Estate Planning

Without planning, many heirs face steep tax bills. Los Angeles homes purchased decades ago may have tax bases under $5,000 annually — but after reassessment, children could owe $15,000 or more per year. That often forces families to sell.

Prop 19 Planning Strategies

While Prop 19 closed many loopholes, there are still tools available:

Family Property LLCs

for gradual ownership transfers.

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with specific structuring.

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Lifetime Transfers

to help lock in tax bases.

Prop 19 Exceptions

The only major exceptions are:
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If the child lives in the inherited primary home.

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If the property is a family farm.

Even then, Prop 19 applies a $1M cap on assessed value beyond the original tax base.

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Frequently Asked Questions

  • Can my children keep my tax base?

    Yes, but only if they move into the home as their primary residence and stay under the $1M cap.

  • Does Prop 19 affect rental properties?

    Yes. Rental homes and second properties are almost always reassessed at market value.

  • Is there a way around Prop 19?

    Advanced planning strategies may help, but they must be personalized and carefully structured.

Don’t Lose Your Family Home to Taxes

With proactive planning, your family can reduce the risk of losing its legacy property.