For heirs, Prop 19 can either protect a low tax base or trigger a big reassessment. The difference often comes down to occupancy and deadlines.
If you’re expecting to inherit your parents’ home, you might assume you’ll automatically keep their low property tax base. For years, many families planned around that idea. Proposition 19, passed in 2020, changed the rules for parent-to-child transfers, and those changes can affect whether keeping an inherited home is affordable, especially in high-value areas across Southern California.
I want to walk through the everyday version of Proposition 19, because most people only hear the scary headlines and miss the details that actually matter when a transfer happens.
What did Proposition 19 change? Before Proposition 19, children could often inherit property and keep their parents’ low property tax base, and that benefit frequently applied even if the property was not the parents’ main home. In many cases, families can hold on to rentals or other properties while still preserving the lower tax base built over decades.
Under Proposition 19, that broad benefit is gone. The main tax benefit for parent-to-child transfers now applies only to the parent’s principal residence, which is the home the parent actually lived in. A vacation home does not qualify. A rental does not qualify. An older income property bought years ago does not qualify. This single change is the reason many families see unexpected tax increases after a transfer.
The occupancy requirement. Even when the property is the parents’ principal residence, the tax benefit is not automatic. If you want to keep your parents’ property tax base in whole or in part, you must move into the home and make it your principal residence.
That requirement matters because it removes the option to inherit the home and rent it out while keeping the lower tax base. It also removes the option to leave it vacant for long periods. If you don’t move in and treat it as your primary home, the county can reassess the property at its current market value, which can create a much higher property tax bill.
"Prop 19 only protects taxes on a parent’s primary home, not rentals."
Strict deadlines and required filings. Proposition 19 is also deadline-driven, and this is where people lose the benefit even when they would have qualified. You must file for the homeowner’s exemption within one year of the transfer. If you miss that one-year window, the benefit is gone.
There is also a second filing requirement that often gets overlooked. You must file a form called the Claim for Reassessment Exclusion for Transfer Between Parent and Child. In the script, it’s referenced as the BOE-19 form, and it must be filed within three years of the transfer or before the property is sold to someone else, whichever comes first. It can also be due within six months of the county issuing a supplemental or escape assessment tied to the transfer. These timelines can feel bureaucratic, but they have real consequences if they’re missed.
The one-million-dollar value limit. The next key point is the value cap, because this is where many families assume they qualify and later find out the tax base changes. If the home’s market value at the time of transfer is one million dollars or less, you can keep your parents’ tax base exactly as it is.
If the market value is over one million dollars, you’re not automatically disqualified, but a value comparison test applies that can lead to a partial reassessment. That means the tax base may increase, but not necessarily all the way up to full market value. The script points out that the math is specific, which is why many families need help understanding how the formula impacts their situation.
The benefit depends on continued residency. Even after an exclusion is approved, it only lasts as long as you continue living in the home as your primary residence. If you move out later, even years after the transfer, the property is reassessed.
When that happens, the new tax base becomes the market value as of the original transfer date, adjusted annually under Proposition 13 limits. The important point is that this is not a permanent, set-it-and-forget-it benefit. It remains tied to occupancy over time.
What families should keep in mind? Proposition 19 didn’t eliminate all parent-to-child tax benefits, but it made them narrower, stricter, and less forgiving. If your family owns property, expects an inheritance, or is dealing with a trust or probate transfer, it’s worth paying attention to the move-in requirement, the deadlines, and the value rules before decisions are locked in. A missed form, a missed deadline, or a misunderstanding about residency can trigger a major and permanent tax increase.
Transferring a home from parent to child shouldn’t create unnecessary financial setbacks. With the right plan for occupancy, filing deadlines, and value limits, you can protect the tax benefit that may be available after the transfer. If you’re dealing with a transfer now or planning for one soon and you have questions, feel free to call or text me at 562-316-2915 or email me at [email protected]. I can help you understand how these rules apply to your situation and what steps to take next.
