If you or your spouse that resides with you are age 55 or older, you may buy or construct a new home of equal or lesser value than your existing home and transfer the trended base value to your new property. This is a one-time only benefit. You must buy or complete construction of your replacement home within two years of the sale of the original property. Both the original home and the new home must be your principal place of residence. A claim must be filed within three years of purchasing or completing new construction of the replacement property. If a claim is filed after the three-year period, relief will be granted beginning with the calendar year in which the claim was filed. Once you have filed and received this tax relief, neither you nor your spouse who resides with you can ever file again
1. The replacement property must be your principal residence and must be eligible for the Homeowners’ Exemption or Disabled Veterans’ Exemption. 2. The replacement property must be of equal or lesser “current market value” than the original property. The “equal or lesser” test is applied to the entire replacement residence, even if the owner of the original property acquires only a partial interest in the replacement residence. Owners of two qualifying original residences may not combine the values of those properties in order to qualify for a Proposition 60 base-year transfer to a replacement residence of greater value than the more valuable of the two original residences. 3. The replacement property must be purchased or built within two years (before or after) of the sale of the original property. 4. Your original property must have been eligible for the Homeowners’ or Disabled Veterans’ Exemption. 5. You, or a spouse residing with you, must have been at least 55 years of age when the original property was sold.
If you meet all other eligibility requirements, relief is granted for a single family residence, condominium, unit in planned development, cooperative housing, community apartment, manufactured home subject to local real property tax, and living unit within a larger structure consisting of both residential and non-residential accommodations.
A claim must be filed within three years of purchasing or completing new construction of the replacement property. If a claim is filed after the three-year period, relief will be granted beginning with the calendar year in which the claim was filed
The meaning of “equal or lesser value” depends on when you purchase the replacement property. In general, equal or lesser value means: 100% or less of the market value of the original property if a replacement property was purchased or newly constructed before the sale of the original property, or 105% or less of the market value of the original property if a replacement property was purchased or newly constructed within the first year after the sale of the original property, or • 110% or less of the market value of the original property if a replacement property was purchased or newly constructed within the second year after the sale of the original property. When making the “equal or lesser value” test, it is important to understand that the market value of a property is not necessarily the same as the sale or purchase price. The Assessor will determine the market value of each property. In some new developments, the indicated sale price does not include upgrades paid for outside of escrow. The Assessor must consider the value of these upgrades when determining the market value of the property. If the market value of your replacement dwelling exceeds the “equal or lesser value” test, no relief is available. It is “all or nothing” with no partial benefits granted.
This isn’t a complete resource page, nor is this a tax advice.
For more information to see if you may qualify please CALL RON:
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Long Beach Homeowner
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Long Beach Homeowner
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