Transfer of Property Tax Base to Replacement Property - Individuals with Disabilities
Did you know property owners with severe and permanent disabilities can transfer their taxable values when they sell their homes and buy or build another house and avoid paying higher property taxes? The Assessor's Office is committed to providing qualifying property owners with all applicable tax savings.
In November 2020, California voters approved Proposition 19, which allows property owners with severe and permanent disabilities to transfer the taxable value of their principal residence to a replacement residence in any California county. This transfer can be made up to three times, provided specific requirements are met.
When properties change ownership, they are typically reassessed to current market value, potentially increasing the taxable value and property taxes owed. Prop. 19 prevents the reassessment of replacement homes to current market value upon a change of ownership, which can significantly increase property taxes compared to those on the original residence. “Taxable value” refers to a property’s base year value plus annual inflationary adjustments, sometimes called the factored base year value.
Revenue and Taxation Code § 69.6 implements the Prop. 19 base year value transfer provisions for disabled persons for transfers that occur on or after April 1, 2021.
For more information about base year value transfers for property owners with disabilities, please refer to the Board of Equalization's info sheets.
To qualify for this exclusion, the following conditions must be met:
The claimant must be severely and permanently disabled at the time the original property is sold.
Either the sale of the original home, the purchase or new construction of the replacement home, or both must occur on or after April 1, 2021.
The claimant must own and reside in the original property at the time of sale or within two years of purchasing or constructing the replacement property.
The original property must be sold, and the replacement property purchased for consideration. Consideration is defined as something of value such as payment of cash, creation or cancellation of debt, or exchange of other property.
Additional information:
The original property must be your principal residence at the time of sale or within two years of buying or completing construction on your replacement home. It cannot be your vacation home.
The replacement property must be purchased within two years (before or after) of the sale of the original property.
You or your spouse living in the home must be severely and permanently disabled when you sell your original property.
A "severely and permanently disabled person” is defined by Revenue and Taxation Code § 74.3 as “any person who has a physical disability or impairment, whether from birth or by reason of accident or disease, that results in a functional limitation as to employment or substantially limits one or more major life activities of that person, and that has been diagnosed as permanently affecting the person’s ability to function, including, but not limited to, any disability or impairment that affects sight, speech, hearing, or the use of any limbs.”
You or your spouse must have a severe and permanent physical disability such that the primary purpose of moving to a replacement home is to satisfy the disability-related requirements or to alleviate financial burdens caused by the disability.
Proof of severe and permanent disability is provided through the completion of a form that includes a certification by a licensed physician or surgeon identifying the disability and the reasons why a move to a replacement home is necessary.
There is no age requirement to receive the benefit of a base year value transfer to your replacement property if you or your spouse are severely and permanently disabled.
Under Proposition 19, you can transfer your base year value up to three times, regardless of whether a base year value transfer was previously granted prior to April 1, 2021, under Proposition 60, 90, or 110.
Rather than purchasing a replacement home, you can make changes or additions to your existing home to make it more accessible for a severely and permanently disabled person who is a resident of the home. Such changes would not increase the assessment. For more information, visit Exclusion of New Construction for Property Owner with Disabilities.
If you buy a replacement property with a market value lower than that of the original property, any new construction completed on the replacement within two years of the sale of the original can be included in the transferred base year value, up to the amount of the original property’s market value.
You cannot benefit from this exclusion if you transfer your original property to your child and your child claims the parent-child exclusion.
If the market value of the replacement property is less than the factored base year value of the original property at the time of the transfer, then claiming the exclusion is not beneficial.
If you did not receive the Homeowners’ Exemption or Disabled Veterans’ Exemption on the original property, you can still qualify for a base year value transfer if you were eligible for one of these exemptions at the time of sale or within two years of the replacement property’s purchase or new construction.
Property owned by a legal entity (e.g., a corporation) is not eligible for a base year value transfer.
How to apply for the base year value transfer exclusion:
Complete two forms: (1) BOE-19-D, Claim for Transfer of Base Year Value to Replacement Primary Residence for Severely and Permanently Disabled Persons and (2) BOE-19-DC, Certificate of Disability. Obtain the claim form from the assessor’s office in the county where the property is located. Submit the completed form to the same office.
To qualify for this base year value transfer, the claim must be filed with the County Assessor within three years of the date you purchased or completed construction on the replacement home.
The base year value transfer is still available for claims filed after the three-year period; however, the transfer will be granted beginning with the year that the claim is filed.
