My Life as a San Francisco Realtor: California's Prop 60 - Property Tax Valuation Transfer

California's Prop 60 - Property Tax Valuation Transfer

A few months ago I wrote a post called You CAN take it with you - Your Property Tax Value, that is.

Recently I had a discussion with a gentleman who dropped by my office.  He and his wife own a duplex in the City and are considering downsizing. They live on the top floor. The bottom unit is unoccupied, and has been for 20 years.  The bottom unit has been depreciated to almost nothing. he wanted to know my opinion of what value he could transfer based on Prop 60.

There are a number of considerations involved. He kept talking about the 'basis' value. Since the unit has been depreciated, this would definitely come in to play when they sold it as relates to capital gains taxes. But does this have any impact on Prop 60 values? Prop 60 is easy to understand when you're talking Single Family Homes. Or even condos. But multiple units? A different story.

I recently read a post elsewhere concerning a similar event, only backwards. The seller wanted to sell his SFR  and buy a duplex. The poster said that the value of his home would compare to the value of one of the duplex units, the one he would occupy. I assume for property tax purposes, he could transfer his tax basis to half the duplex, while the other half would be taxed at full value?

Taking this in reverse, the gentleman in question could sell his duplex and transfer half the value (if the two units are equal) to a new SFR. For example, the duplex sells for $1 mil. so he can buy a new home for $500,000 or less and transfer his original tax basis. Complicated stuff!

Looks like I'll be making a call to the San Francisco assessor's office on Monday for more detailed information.....

 

John M Scott, Broker / Owner, Scott Keys Properties, Certified Distressed Property Expert (CDPE), Council of Real Estate Brokerage Managers (CRB), serving San Francisco and the surrounding San Francisco Bay Area

Comment balloon 6 commentsJohn M. Scott • July 29 2011 09:25PM

Comments

An interesting question.  Let us know what you find out about his.

Posted by Joan Whitebook, Consumer Focused Real Estate Services (BHG The Masiello Group) about 7 years ago

Yes it is Joan. I will definitely report what I hear from the Assessor's office!

Posted by John M. Scott, Broker / Owner San Francisco Bay Area (BRE # 01442690, Scott Keys Properties) about 7 years ago

He's fortunate to have not only a knowledgeable broker guiding him, but also one who is willing to do the legwork!

Posted by Susan Haughton, Susan & Mindy Team...Honesty. Integrity. Results. (Long and Foster REALTORS (703) 470-4545) about 7 years ago

Susan, questions in real estate aren't always in black and white. There are many shades of grey!

Posted by John M. Scott, Broker / Owner San Francisco Bay Area (BRE # 01442690, Scott Keys Properties) about 7 years ago

John, This can be complicated stuff.  When you call the Assessor's Office just know that information is  only as good as the person giving it to us.  We need to validate-validate-validate what third parties tell us ... the workers who answer the phone and/or work the desk are often not qualified to answer more complicated Prop issues.  Good luck with this!

Posted by Kathleen Daniels, San Jose Homes for Sale-Probate & Trust Specialist (KD Realty - 408.972.1822) about 7 years ago

John ... Thanks for your post here, and CA prop 60 and 90 are complicated.  We recommend that our friends and clients who are 55 and over and want CA property tax relief, consult with the county tax collector in both the selling county and the buying location county to make sure they qualify.  Several of our clients have experienced success with prop 60 sale and purchase in the same county of Orange.

Posted by Harrison K. Long, REALTOR , GRI, Broker associate, Attorney (HomeSmart, Evergreen Realty) almost 7 years ago

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