Frequently Asked Questions about Propositions 60, 90 and 110
For more information on Prop 60 or Prop 90 please browse through the following questions that we find some of our clients have after and introduction to the benefits of the three propositions.Proposition 60:
Used for homes within the same county that allows a qualified person over the age of 55 to transfer the base year values of a former residence (“original property”) to a replacement or new residence.
Must be age 55 or older, and own and occupy the original residential property as the owner’s principal place of residence as of the date of transfer to a new owner. If the claimant is married and resides in the original residence with his/her spouse, then both spouses qualify if either one of them is at least 55 as of the date of transfer (sale).
What is a transfer of the base of your value? :
The base year is the year in which the property or portion thereof is purchased, newly constructed, or a reappraised event in ownership change occurs. This date and it’s corresponding assessed property tax is the basis used in this process.
What other “conditions” must be met to qualify?:
Both the original and the replacement properties must be located in the same county under proposition 60. Prop 90 allows original properties and replacement properties to be from different but cooperating counties.
The original property must have been eligible for the homeowner’s exemption (claimant owned and occupied it as principal residence at the time of sale or within two years of the acquisition of the replacement property).
The replacement dwelling must be of equal or lesser value than the original property.
The replacement dwelling must have been acquired or newly constructed within two years before or after the sale of the original property as long as the replacement property was acquired or newly constructed on or after November 6, 1986.
The original property must be subject to reappraisal at its current “fair market value” as a result of its sale and transfer.
A claim must be filed within three years of the replacement dwelling purchase or completion of new construction of the replacement dwelling.
What if I jointly own the property with someone else who is not my spouse?:
The same rule applies. If there are two or more co-owners of a dwelling, all owners qualify if only one owner on record is over 55 and if that owner/claimant occupies the property as of the date of the transfer.
How often can I claim the Proposition 60 Benefit?
The benefits of the Proposition 60 exclusion are granted only once in a claimant’s lifetime.
As a co-tenant of the original property with another owner, may I receive a partial benefit if we apply for the exclusion & buy separate replacement home?
NO. Only one co-owner of a qualified original property may receive the benefit in this situation. The co-owners’ must choose between themselves which one will make the claim. The only exception is a multiple-residence original property (such as a duplex) where multiple owners qualify for separate homeowner’s exemptions. In that case, each owner may transfer a portion of the original property’s value to their separate replacement dwelling.
NO. A gift of the original home to the owner’s child, while the owner is alive or through a will upon the owner’s death, does not qualify. The original property must be sold in exchange for something of monetary value (“consideration”) and be subject to reappraisal at full market value at the time of the transfer (sale). What is “equal or lesser value” of the replacement dwelling?
In general, “equal or lesser” than market value of a replacement dwelling has been defined as: 100% of market value of original property as of its date of sale if a replacement dwelling is purchased before an original property is sold; 105% of market value of original property as of its date of sale if a replacement dwelling is purchased the same day or within one year after the sale of an original property; 110% of market value of original property as of its date of sale if a replacement dwelling is purchased after one year, but before two years have passed from the sale of the original property. Is it true that a replacement dwelling may be acquired any time within two years (before or after) of the date of sale of the original “primary residence” property?
YES As sole owner of the original property, may I qualify when I jointly buy a share of a replacement?
YES. May one sole owner of a qualified original home & other sole owner of a separate qualified original home apply their separate Proposition 60 benefits to the same replacement residence they buy jointly?
NO. Each owner may only receive the benefit of a single claim. The owners may only receive their benefits to buy a replacement dwelling of equal or less value than the combined original value. Proposition 90: For Properties in Different Counties
Proposition 60 requires that both the relinquished and newly acquired homes be within the same county. Proposition 90, adopted in 1988, extends Proposition 60’s benefits to homes in two participating counties, but only if the county of the replacement property has adopted a county ordinance permitting the local County Assessor to apply the fair market value determined by the County Assessor of the original home. Which counties grant Proposition 90 exclusions?
Alameda, Los Angeles, Orange, San Diego, El Dorado, San Mateo, Santa Clara and Ventura are all currently participating in the program. Since participation in the program can change at any time, contact the County Assessor in the county where you plan to buy to verify the current status of the participation. Proposition 110: For severely disabled persons:
Proposition 110 was adopted on June 5, 1990 to extend Proposition 60 to severely disabled persons residing permanently in the property. Also, in existing homes qualified for a homeowner’s exemption, certain construction, modifications, or installations intended to increase accessibility for an owner or an owner’s severely & permanently disabled spouse, are excluded from reappraisal. Do I need to be 55 or older to qualify under Propsosition 110?:
NO. Proposition 110 applies regardless of age.