Change in Ownership
The Revenue and
Taxation Code defines change in ownership as “a transfer of a present
interest in real property, including the beneficial use thereof, the value
of which is substantially equal to the value of the fee interest”.
However, either by
legislation or voter initiative, several types of transfers are excluded
from reassessment. Listed below are those most commonly occurring.
Please contact the Assessor’s Office for additional information regarding
change in ownership.
Change In Vesting
No Change To
Proportional Ownership Interests
Trusts
Estate For Years/Life
Joint Tenancy
Creation
Leases
Parent/Child
Exclusion
Property
Replaced After Acquisition By Public Entity
Interspousal Exclusion
Domestic Partnership
Replacement
Dwelling Exclusion: Claimant Over 55
Replacement
Dwelling Exclusion: Claimant Disabled
Change In
Vesting
Any transfer between
co-owners that results in a change in the method of holding title to the
real property transferred without changing the proportional interests of
the co-owners is excluded (i.e. change from joint tenancy to tenancy in
common).
No Change To
Proportional Ownership Interests
Generally, transfers
between individuals and a legal entity or between legal entities that
result solely in a change in the method of holding title, and in which
proportional interests of the transferors and transferees remain exactly
the same, are excluded.
Trusts
The transfer by the
trustor/trustor’s spouse into a trust for so long as (1) the transferor is
the present beneficiary of the trust or (2) the trust is revocable or
any transfer by a trustee of such a trust back to the trustor is excluded.
Estate For Years/Life
Any transfer whose terms
reserve to the transferor an estate for years/life is excluded.
Joint Tenancy Creation
The creation of a joint
tenancy, if all the transferors are among the joint tenants, is excluded
from change in ownership.
Leases
The creation of a
leasehold interest in taxable real property for a term of less than 35
years (including renewal options), the termination of a leasehold interest
in taxable real property which had an original term of less than 35 years
(including renewal options), and any transfer of a leasehold interest
having a remaining term of less than 35 years (including renewal options)
are excluded from change in ownership.
Parent/Child Exclusion
Transfers between parents
and children occurring on or after November 6, 1986 may be eligible for
exclusion from reassessment. The property must be transferred from
parents to their children or children to their parents, and a claim form
must be filed with the Assessor timely as provided by statute. The
exclusion applies to the principal residence, as defined, or the first
$1,000,000 assessed value of other real property.
Some transfers from
grandparents to grandchildren may also be excluded. The transfer
must occur on or after March 27, 1996 and the parent of the
grandchild who is the child of the grandparent must be
deceased as of the transfer date. A claim form must also be filed timely
with the Assessor to qualify for this exclusion.
Contact the Assessor
for more information regarding these exclusions.
This form is available online. Click here to go
to Change in Ownership forms.
Property
Replaced After Acquisition By Public Entity
Change in Ownership does
not include the acquisition of real property as a replacement for
comparable property if the original property was located in California and
acquired by eminent domain, acquisition by a public entity, or by
governmental action resulting in a judgment of inverse condemnation. A
claim form must be timely filed with the Assessor to qualify for this
exclusion.
Interspousal Exclusion
Transfers of property
between spouses are excluded from reassessment, including transfers
between former spouses in connection with a property settlement or decree
of dissolution of a marriage.
Domestic Partnership
Effective with transfers occurring on or after January 1, 2006, any transfer
between registered domestic partners is excluded from reassessment.
Replacement
Dwelling Exclusion: Claimant Over 55
Effective November 5,
1986 and provided certain requirements are met, any person who is at least
55 years of age (at the time of sale of original/former property) who
resides in a property eligible for the Homeowners Exemption or currently
receiving the Disabled Veterans’ Exemption is allowed to transfer the
base-year value of the original property to a replacement dwelling of
equal or lesser value within the same county. “Original property” and
“replacement dwelling” are defined for this exclusion as a building,
structure, or other shelter constituting a place of abode which is owned
and occupied by a claimant as the principal place of residence, and “land”
includes only that area of reasonable size which is used as a site for a
residence.
A claim form must be
filed for this exclusion within 3 years of the date a replacement dwelling
is purchased or new construction of that replacement dwelling is
completed. Some counties, by ordinance, do allow the exclusion even if
the original residence was in another county. However, the acquisition of
the replacement dwelling must occur on or after the date specified in that
county’s ordinance.
Please contact the
Assessor for more information regarding this exclusion.
This form, including instructions, is available online. Please
click here.
Replacement
Dwelling Exclusion: Claimant Disabled
Effective June 6, 1990
and provided certain requirements are met, any person who is severely and
permanently disabled, as defined, at the time of sale of original/former
residence and who resides in a property eligible for the Homeowners’
Exemption or currently receiving the Disabled Veterans’ Exemption is
allowed to transfer the base-year value of the principal residence to a
replacement dwelling of equal or lesser value within the same county.
A claim form must be
filed for this exclusion within 3 years of the date a replacement dwelling
is purchased or new construction of that replacement dwelling is
completed. Some counties, by ordinance, do allow the exclusion even if
the original residence was in another county. However, the acquisition of
the replacement dwelling must occur on or after the date specified in that
county’s ordinance.
Please contact the
Assessor for more information regarding this exclusion.
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