The Veridian Blog

Don and Joanie, husband and wife, are 56 and 54, respectively, and wish to sell their house in Los Altos where they have been living for over 20 years in order to move to a bigger house on a bigger lot in Walnut Creek.  They mention to you that they'd like to take advantage of the one-time election of Proposition 60 - which allows transfer of the base year tax assessment from one residence to another and hence avoid a potentially huge markup in property tax.  Can they?

Proposition 60 is a once-in-a-lifetime property tax reassessment exclusion that allows homeowners 55 years or older to transfer their base year value of their principal residence to a newly purchased principal residence in the same county.  There are other rules – such as a two-year window to find the replacement property which has to be equal or lesser in value than the original home.  Now, either the claimant or the claimant’s spouse need be 55 years old, so in Don and Joanie's case, they are eligible except for the fact that they are buying a new house in Contra Costa County, while selling one in Santa Clara County.  As such, Proposition 60 does not apply.

Alas, Proposition 90 allows homeowners to transfer their base year value to another county – under the same rules and restrictions of Proposition 60 – provided that the county that they elect to move to has approved Proposition 90.  As of 2011, only the following eight counties participate:

Alameda, Los Angeles, Orange, San Diego, San Mateo, Santa Clara, Ventura and El Dorado (as of 2010).  Unfortunately, for Don and JoAnn, they are out of luck again as Contra Costa dropped out of the Prop 90 program.  In a time of rising values and property appreciation, just knowing that little tidbit could save you or your client thousands of dollars by knowing which county they can transfer their tax base to.