Avoiding Real Estate Tax Revaluations
Avoiding Real Estate Tax Revaluations
by Steven Singer, CPA
As a result of the passage of Proposition 13 almost thirty years ago, real estate owners currently enjoy paying property taxes based on the property’s purchase price, value of improvements and an annual increase of 2% over the previous years’ assessed value. As a result of its passage, owners pay significantly lower property taxes than if their property was valued under current market conditions.
Property Value Guidelines Under Proposition 13
Most owners believe that unless they sell their property, the assessed value will not increase over the proscribed limits of Proposition 13. However, a change in ownership of real estate through gift, transfer, inheritance, or the addition or removal of an owner, may cause a revaluation for real property tax purposes. There are many types of exemptions available to the property tax owner that will not increase their property tax values. For families, partnerships or corporations that own real property and have changed the owner, through inheritance, transfer or stock ownership change, ignorance of these exemption can result in thousands of lost dollars paid for increased property value assessment.
Avoiding Property Tax Reassessment
Failure to take advantage of these exemptions may cause a substantial increase in your real estate tax bills for the life that you hold the property. Proper planning in partnership with a firm familiar with available exemption can help you avoid paying an increased property tax bill. Each owner has different circumstances that dictate which exemption may be used. The following are the most common kinds of exemption:
Types of Exemptions Available
Transfers between husband and wife
Transfers between parents and children
Transfers in jointly held property
Inherited Property
Transfers to and from trusts
Seniors over 55 may keep the same property tax bill as old residence for newly acquired personal residences.
Transfers of interests in Corporation and Partnerships owning real property
Greenstein, Rogoff and Olsen & Co, LLP — Experienced Real Estate Planners
Our firm has substantial experience helping our clients in real property transfers. We can navigate and explain rules regarding reporting, exemptions and planning for you, which may result in substantial savings.
If you wish to learn more about these exemptions and how they apply in your situation, please contact Steven Singer at 510-797-8661 or email him at ssinger@groco.com
For a more detailed listing and explanation of the exemptions available, please download our 13-page report, How to Avoid or Defer Property Tax Reassessments (PDF, 213k).
We hope you found this article about “Avoiding Real Estate Tax Revaluations” helpful. If you have questions or need expert tax or family office advice that’s refreshingly objective (we never sell investments), please contact us or visit our Family office page or our website at www.GROCO.com. Unfortunately, we no longer give advice to other tax professionals gratis.
To receive our free newsletter, contact us here.
Subscribe our YouTube Channel for more updates.
Alan Olsen, is the Host of the American Dreams Show and the Managing Partner of GROCO.com. GROCO is a premier family office and tax advisory firm located in the San Francisco Bay area serving clients all over the world.
Alan L. Olsen, CPA, Wikipedia Bio
GROCO.com is a proud sponsor of The American Dreams Show.
The American Dreams show was the brainchild of Alan Olsen, CPA, MBA. It was originally created to fill a specific need; often inexperienced entrepreneurs lacked basic information about raising capital and how to successfully start a business.
Alan sincerely wanted to respond to the many requests from aspiring entrepreneurs asking for the information and introductions they needed. But he had to find a way to help in which his venture capital clients and friends would not mind.
The American Dreams show became the solution, first as a radio show and now with YouTube videos as well. Always respectful of interview guest’s time, he’s able to give access to individuals information and inspiration previously inaccessible to the first-time entrepreneurs who need it most.
They can listen to venture capitalists and successful business people explain first-hand, how they got to where they are, how to start a company, how to overcome challenges, how they see the future evolving, opportunities, work-life balance and so much more..
American Dreams discusses many topics from some of the world’s most successful individuals about their secrets to life’s success. Topics from guest have included:
Creating purpose in life / Building a foundation for their life / Solving problems / Finding fulfillment through philanthropy and service / Becoming self-reliant / Enhancing effective leadership / Balancing family and work…
MyPaths.com (Also sponsored by GROCO) provides free access to content and world-class entrepreneurs, influencers and thought leaders’ personal success stories. To help you find your path in life to true, sustainable success & happiness. It’s mission statement:
In an increasingly complex and difficult world, we hope to help you find your personal path in life and build a strong foundation by learning how others found success and happiness. True and sustainable success and happiness are different for each one of us but possible, often despite significant challenges.
Our mission at MyPaths.com is to provide resources and firsthand accounts of how others found their paths in life, so you can do the same.
Who Really Qualifies as a Dependent for Taxes?
How many dependents do you really have? Who can really be counted as a dependent? These are some of the most common questions that all taxpayers have. Can you count all of your children, live-in help, or perhaps a dog or other family pet? What about a friend who decides to crash at your place…
Obama Looking to Stick the Wealthy With Even More Taxes
His second term in office is winding down, but President Obama would still like to raise taxes on high net worth individuals before he checks out of the White House at the beginning of next year. Although the president has already taken several measures to raise the effective tax rate on the wealthy, he is…
Which Tax Breaks Help High Net Worth Taxpayers the Most?
It’s no secret that the United States government generally taxes high net worth individuals at a much higher clip than those in the lower- and middle-income brackets. However, despite that fact, there are still many provisions in the tax system, if used properly, can help wealthy earners save on their taxes. So what are some…
Tax Preparers Get Busted for Fraudulent Practices
Every tax season is full of stories and tales of people who go to great lengths to avoid paying taxes. In addition there are dozens of reports of unscrupulous tax preparers that get caught trying to cheat the system: either their clients or the IRS, or both. We want to share a few of those…