Proposition 19: What is it?

As of February 15, Prop 19 passed, repealing of Prop. 58 and Prop. 193, created a new far more narrow ownership exclusion.

With the passing of Proposition 19, there are countless unanswered questions regarding its implementation, who still qualifies for Prop 58 and Prop 193, and who will be subject to rules and limitations of Prop 19. We are well equipped to field your questions and guide you through the process. HCS Equity is prepared to provide a third-party loan to a trust or estate to assist with the equalization, backed by plenty of capital and resources available to get these transactions completed.

To assist taxpayers, the below information is provided by California’s Board of Equalization to offer guidance on navigating Proposition 19.

  Former Law (Proposition 58) Proposition 19 (Current Law)
Principal Residence
  • Principal residence of transfer or
  • No value limit
  • Residence and homesite (excess land may be excluded as “other property”)
  • Principal residence of transferor and transferee
  • Value limit of current taxable value plus $1,000,000 (as annually adjusted)
  • Family homes and farms
Other Real Property
  • Transfer or lifetime limit of $1,000,000 of factored base year value
  • Eliminates exclusion for other real property other than the principal residence
Grandparent-Grandchild Middle Generation Limit
  • Parent(s) of grandchild, who qualifies as child(ren) of grandparent, must be deceased on date of transfer
  • No change:  parent(s) of grandchild, who qualifies as child(ren) of grandparent, must be deceased on date of transfer
Filing Period
  • File claim within 3 years or before transfer to third party
  • File for homeowners’ exemption within 1 year of transfer
Implementing Statute
  • Revenue & Taxation Code section 63.1 (implements Propositions 58/193)
  • To be determined
Important Dates
  • Through February 15, 2021
  • Effective February 16, 2021

FAQ’s Regarding Parent-Child and Grandparent-Grandchild Transfers 

These frequently asked questions (FAQs) are intended by the BOE to help property taxpayers navigate those new provisions in light of Proposition 19’s lack of clarity or silence. It is anticipated that these FAQs will be updated periodically with additional questions, particularly if legislation is enacted or further guidance is issued by the Board. Please check back often for updates.

No, Legislature is clear that Proposition 58 applies to transfers that occurred on or before February 15, 2021, and that Proposition 19 applies to transfers that have or will occur on or after February 16, 2021.

Our understanding is that at least one eligible transferee must plan to continually live in the property as his or her family home for the property to maintain the exclusion. Once the property is no longer your family home, it will receive a new taxable value. The new taxable value will be the assessed market value of the home on the date you inherited it and adjusted each year accordingly.

It appears that the current intent of the Legislature is to allow the exclusion as long as the parent’s family home becomes the family home of at least one of the children.

No, Proposition 19 limits the parent-child exclusion to a transfer of a family home that is the principal residence of the transferor and becomes the principal residence of the transferee.

As long as the date of transfer or change in ownership of real property between parent and child occurred on or before February 15, 2021, the transfer will qualify for the exclusion under Proposition 58/193. The date of death is the date of the change in ownership. The claim must be filed with the County Assessor within three years of the date of transfer or before a transfer to a third party or within six months of the date of notice of supplemental or escape assessment. Therefore, the claim does not need to be filed by February 16, 2021.

The value limit under Proposition 19 is the sum of the factored base year value plus $1 million. If the market value exceeds this limit, partial relief is available. The amount exceeding the excluded amount will be added to the factored base year value.

The law in effect is that the date of death will apply. Proposition 19 is clear that Proposition 58 applies to transfers that occur on or before February 15, 2021, and Proposition 19 applies to transfers that occur on or after February 16, 2021.

No. As long as the date of transfer is on or before February 15, 2021, the transfer will qualify for the Proposition 58/193 exclusion. Property Tax Rule 462.260 makes clear that the recordation date of a deed is rebuttably presumed to be the transfer date. This means that if evidence is shown that the transfer occurred prior to the recordation date, the assessor should accept that earlier date. Such evidence could be, for example, the date of a notarized document of transfer, such as a deed.

The administration of a trust is governed by the trust instrument itself. For properties held in trusts, Revenue and Taxation Code section 61(h) states that a change in ownership occurs when any interests in real property vest in persons other than the trustor or the trustor’s spouse or registered domestic partner when a revocable trust becomes irrevocable. This typically occurs upon the death of the trustor. The date of death is considered to be the date of change in ownership. Proposition 19 is clear that Proposition 58 applies to transfers that occur on or before February 15, 2021, and Proposition 19 applies to transfers that occur on or after February 16, 2021.

If you have further questions, you may call one of our experts at HCS Equity at (844) 394-9300.

Disclaimer: This information is compiled by California’s Board of Equalization and is intended by HCS Equity to provide general and summary information about Proposition 19. It is not intended to be a legal interpretation or official guidance or relied upon for any purpose, but is instead a presentation of summary information. If there is a conflict between the information presented and the text of the proposition or its implementation, the text of the proposition or legal interpretation will prevail. It is highly encouraged that you consult an attorney for advice specific to your situation.

Contact us to create a plan.

With the passing of Proposition 19, there are countless unanswered questions regarding its implementation, who still qualifies for Prop 58 and Prop 193, and who will be subject to rules and limitations of Prop 19. We are well equipped to field your questions and guide you through the process. HCS Equity is prepared to provide a third-party loan to a trust or estate to assist with the equalization, backed by plenty of capital and resources available to get these transactions completed.

To learn more about Proposition 19 and how it affects you or your clients, contact HCS Equity at 844-394-9300. We will continue to update our website as new developments regarding Proposition 19 become available.

    Is the property located in California? *Please note we only provide loans within CA
    In CaliforniaNOT In California

    What would you like more information or to talk about?
    Trust LoanProbate LoanReverse Mortgage PayoffOther