How Does Proposition 19 Affect You?
Proposition 19 offers staggering benefits for people thinking about moving.
Are you aware of the awesome benefits of Proposition 19 if you move within the state of California? Prop 19 is a law in the state of California that went into effect in early 2021. It altered many of the existing laws that governed transferring your property taxes to different areas of the state. While Propositions 60 and 90 used to limit the counties you could move to, Prop 19 now allows you to transfer your tax anywhere across the state. This is a huge advantage for Californians. Let’s take a look at some of the components of this proposition.
This proposition applies to specific categories of people. The first of these is anyone over the age of 55. That’s because the ultimate goal of this proposition is to help people downsize in retirement to save money. They can do this by moving their property tax base to another county without having an increased expense to worry about.
Prop 19 also benefits people with disabilities and those affected by wildfires or other disasters. These were pieces of other propositions that were pulled in under the same guidelines.
"The goal of this proposition is to help retirees downsize to save money."
When someone decides to leave Santa Clara County, they might move to somewhere like El Dorado County or elsewhere in more northern California because it has a slower pace of life, more affordable homes, and much more natural beauty. With Prop 19, you can move like this while keeping your established property tax base.
For example, I recently helped someone sell a home they bought in Blossom Valley, which they purchased in 1972. The original purchase price was under $40,000, and the property tax base today was only $67,000. After selling their home, now worth $1,000,000, they could move to a different area of California with all of that equity and still keep that low property tax base. That means that they are only going to be paying $2,100 in property taxes annually. Without Prop 19, they would be paying over $7,500 per year. That’s an over $500 per month difference, which can be a huge impact if you are living on a fixed income.
With all that in mind, if you need more in-depth information on taxes, equity, or how to move that around, I have some great referrals for financial advisors and planners. Call me anytime and I’ll get you connected with someone who can help you figure out your specific situation.
Still have questions about Downsizing for Retirement and Prop 19 for you or someone you know? Join me at the event I am hosting with other experts next week, Thursday, October 20, 4-6pm and let us help you. Reserve your seat!
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