Can I Avoid a California Property Tax Reassessment When Transferring Ownership?

 Posted on May 08, 2025 in Property Taxes

For homeowners and other property owners in California, property taxes can be a significant issue. Because these taxes can be high, property owners will need to understand what steps they can take to minimize the amounts that they may be required to pay. In 1978, the California Constitution was changed by what is known as Proposition 13 (commonly called "Prop 13), which has helped many property owners avoid substantial increases in property taxes since it limits the amount that property taxes can increase each year. However when ownership of real property is transferred, such as when someone sells their home, this will typically trigger a reassessment of property taxes, and the new owner will be required to pay property taxes based on the property’s current fair market value.

There are some situations where property owners may be able to avoid a reassessment when transferring ownership of real property. NOTE: The laws have changed in recent years, and homeowners and other property owners will need to meet specific requirements to receive exclusions from reassessment requirements. An attorney who understands the laws that apply in these situations can provide guidance to help ensure that property taxes can be minimized.

Exclusions From Property Tax Reassessment

In general, a transfer of ownership interests and beneficial use of a property is considered a change in ownership that will trigger a property tax reassessment. There are certain types of transfers that are excluded, and these changes in ownership will not require a reassessment. Some transfers may be automatically excluded, while others may require property owners to file claims.

Prior to 2021, parents could transfer real property to their children without a reassessment so long as they filed an application with the county assessor’s office. This property included a primary residence, with no limit on the value of the residence, or property other than a primary residence with a value of up to $1 million. Property could also be transferred from grandparents to grandchildren after a grandparent’s child’s death.

A new law passed in 2020 known as Proposition 19 made some changes to these exclusions. For transfers that take place after February 16, 2021, exclusions may apply if a family home or family farm is transferred from parents to children so long as it is the primary residence of both parties. The value limit for these transfers is the property’s current taxable value plus $1 million. Claims must be filed to claim these exclusions.

Exclusions may also be available by filing claims in cases involving the transfer of a residence between cotenants upon the death of one party. In these cases, the cotenants must have been joint tenants or tenants in common, they must have owned 100% of the property together, and they must have resided in the property for at least 1 year prior to the death of a cotenant.

Automatic exclusions from property tax reassessment will apply in certain situations, including:

• Transfers of ownership between spouses, including adding a spouse’s name to the deed of a property, transfers after the death of one spouse, transfers during a divorce, or transfers into a trust for the benefit of a spouse.

• Changes in information on the title to a property, such as when a person changes their name after getting married or divorced.

• The creation of a security interest in real property, such as when a home is used as collateral for a loan.

• Transfers that result in joint tenancy, as long as the original owner will be one of the joint tenants.

• Transfers of property into a revocable or irrevocable trust for the benefit of the original owner or their spouse.

Contact Our San Jose Property Tax Lawyer

Because of the complex laws surrounding property taxes in California, homeowners and other property owners will need to understand what steps they can take to protect their financial interests and minimize the amount of annual county real property taxes they may be required to pay. At John D. Teter Law Offices, our San Jose, CA property tax attorney can provide guidance on how state laws may affect property taxes and how transfers may affect a reassessment. To get effective legal help with these issues, contact our office at 408-866-1810 and set up a consultation today.