What exactly did Prop 19 change for inherited homes?

Under previous laws, parents could pass their home to their children without triggering a property tax reassessment, keeping the tax bill incredibly low. Under Prop 19, this protection is mostly gone. Now, unless the child makes the inherited home their permanent primary residence within one year, the property is reassessed at current market value, which almost always results in a drastically higher, unaffordable tax bill for the heirs.

How does donating the property solve the Prop 19 tax hike?

By donating the property, you completely bypass the staggering Prop 19 reassessment. Instead of paying higher taxes, you secure a comprehensive federal tax deduction based on the property’s full, current Fair Market Value, substantially reducing your own income tax liability.

Do I need to clean out the house or fix it up before donating?

No. You don’t need to clean out the house, fix a leaky roof, or navigate complex California title transfers. Our experienced processing team steps in immediately, managing 100% of the paperwork, deed recording, and legal compliance at absolutely no cost to you.

California Prop 19 and Donating Inherited Property

California Proposition 19 and Donating Inherited Property

Proposition 19, in effect since February 2021, narrowed the parent-to-child property tax exclusion in California. Many inherited properties are now reassessed to market value when they pass to children, which can multiply the property tax bill. For heirs who do not want to live in an inherited house, or who inherited a rental, second home or land, donating it to Real Estate with Causes is one way to avoid carrying that higher tax.

Tell us about the property

Every property gets a look. Name, phone and email are the only required fields.

House Donation Intake

What kind of home is it?

Property address

City, state and ZIP

Estimated Property Value?

Parcel or APN number, if you have it

Bedrooms

Bathrooms

Approximate square feet

Year built

Who is in it now?

Condition

Is it insured right now?

What Proposition 19 changed

Before Prop 19, parents could pass a home and other property to children without reassessment. Now the exclusion generally applies only to a family home that the child makes their own primary residence within a year, and only up to a limit above the parent’s assessed value. Other inherited property is generally reassessed at market value.

Who it affects most

Heirs who inherit rentals, second homes, land, or a family home they will not live in.

Where donation fits

An heir facing a reassessed tax bill on property they do not want can sell, keep and pay, or donate. Inherited property generally takes a basis equal to its value at death, so a sale soon after may carry little gain, which makes the donation-versus-sale comparison closer than usual.

A donation ends the higher tax bill on recording and may produce a deduction based on the appraised value. Your advisor should compare the routes.

What to have ready when you call

The county assessor’s notices help most.

Any reassessment notice

From the county assessor after the transfer.

How title passed

By will, trust or intestacy.

Whether anyone lives there

The family-home exclusion depends on it.

Proposition 19 questions, answered

Will my inherited house be reassessed? +

If you do not make it your primary residence within a year, or its value exceeds the exclusion limit, generally yes, in whole or part.

Does donating avoid the reassessment? +

Donating transfers the property to a charity, so the ongoing tax becomes ours after recording. It does not undo a reassessment already made during your ownership.

Is a rental I inherited covered by the exclusion? +

Generally not. Under Prop 19 the parent-child exclusion is limited to a family home used as the child’s primary residence.

Can an estate or trust donate before distribution? +

Often, within the trustee’s or executor’s authority. That can avoid the heir ever owning it.

Where can I read the rules? +

The California State Board of Equalization publishes Proposition 19 guidance for property owners.

We do not provide tax or legal advice. See IRS Publication 526, Publication 561 and the Form 8283 instructions, and consult your own advisor.