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Are you over 55 and considering a Move? Prop 60/90 can save you on that purchase.

July 29, 2011

Prop 60 & 90 Provide Tax Relief for Californians Over 55

 

Proposition 13 is an ammendment passed by California voters in 1978 to establish guidelines for taxation of local real estate.  It reset the base level to 1% of a home’s value in 1975 and provided for a increase by an inflation factor not to exceed 2%  per year. One of the main reasons for this ammendment was to not price senior citizens out of their homes due to rising taxes. It also allowed the tax to be reset to 1% of the current value when the property was sold.

Propositions 60 and 90 were eventually passed to help persons 55 years of age and over transfer (within certain guidelines) their current assessed value to a new home purchase.  The new purchase must be of equal or lesser value and must be closed or constructed within two years of the sale. This benefit is only available “once in a life time”.  Prop 60 established that the purchase had to be within the same county and Prop 90 allowed the purchase to be made within several participating counties. The list of counties that participate has change over the years so it’s best to check before you make any assumptions.

My husband and I utilized this little known proposition on our last move and it is a lifesaver.  If I weren’t a Realtor, I might not have known about this so I make sure my sellers, and buyers,  are aware of this when considering where they want to move and what type of purchase they want to make. The next purchase must be “equal to or less than” the fair market value of the home you are selling.

For a full breakdown of both Prop 60 and 90, visit this California State Board of Equalization site for more information.  Call me if you have any questions about this and let me help you make your sale and next move……..

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