Prop 19 and Probate Timeline
Proposition 19 mainly highlights the benefits for people aged 55 and above, victims of wildfire and natural disasters, and severely disabled people. But as millennials take over most of the housing market this year, it has already been predicted that this law would severely impact parents and grandparents who were planning on passing down their property to the next generation. It also applies to inheritance by probate. This said, many homeowners scrambled to file their transfers before February 16, 2021, which was the due date given for family transfers.
For Qualified Homeowners:
Since the proposition mainly accommodates the specified qualified homeowners and gives them relief on tax reassessments, there’s not much activity going on. These eligible homeowners can now take advantage of the benefits the propositions have for them and find a home suitable for their needs and possibly accommodate themselves in homes a little more expensive than their current ones. Seniors don’t have to feel locked into their current homes that don’t meet their needs anymore. Especially with the pandemic still going on in the background, qualified homeowners can find homes that can make them feel safe while still having the features they need for comfort. Besides the seniors, the qualification of other eligible homeowners is still up for discussion since there weren’t many implications for them. It’s not been a month since the proposition took its place. Still, we would start to see a movement and a significant change in the housing market, accommodating homeowners looking for properties on their budget.
For Intra-Family Transfers:
Most homeowners completed the process and were able to exempt their children from the possible tax reassessment, but this also gave the inheritors no choice but to make the transferred property their primary home to avoid the significant tax reassessment increase. Along the way, many still questioned regarding the property transfers. What if multiple siblings inherited the family home through probate? Would that mean they have to move in together and make the property their primary home? The best way to settle this, for now, is to seek professional help and discuss among the involved parties on whoever gets to handle the property. The 1-year allowance for the inheritor/s to move into the place and make it their primary home might not be enough time for the family to decide who gets to have the tax exemption. Moreover, families who weren’t able to transfer their homes to their descendants said it gave them only a short time to quickly consider the transfer and relocation due to the COVID-19 pandemic.
Assessors are likely to interpret the proposition differently from county to county. However, there are still many questions that are yet to be discussed and clarified by the legislators.
Families are still waiting for further discussions about Prop 19 to have a clear view of what’s in it for them now that it’s taken into place last April 16, 2021. Assessors are also waiting for clarification on some parts of the proposition which were unclear, especially on probate. People questioned how short the timeframe was given to them to decide how to act for their homes, especially when the pandemic restrictions are still up. For now, families can only see a small portion of their future settlement until another round of discussion comes.
The proposition has still yet to clarify the ramifications it implies for probate. Still, the best way to tackle the dilemma on family inheritance would be a proper family discussion to decide what to do with your inherited property fairly.
As a top producing agent with 20+ years of experience in the East Bay, I have helped hundreds of clients showcase and maximize the sale of their homes in the Greater San Francisco Bay area and the counties of Alameda and Contra Costa. My experience as a former appraiser allows me to help my clients understand the market. If you have any questions, I am here to be a resource for you.