Proposition 90 And Details About Transferring Your Tax Base
On December 10th, 2009, the El Dorado County Board of Supervisors approved the introduction and 1st reading of the Proposed Prop 90 ordinance. On December 15th, 2009 the Board adopted the ordinance after its second reading. The proposed ordinance will have an estimated effective date of February 12th 2010, which is 60 days after the adoption.
As the ordinance is currently written and based on Revenue and Taxation Code Section 69.5 (Prop 90), in order to qualify for a base year transfer:
- The replacement residence must be acquired after the effective date of the ordinance allowing base year value transfers from other counties.
- As of the date of transfer of the original property, the claimant or the claimant’s spouse is at least 55 years of age or severely and permanently disabled. There is no age requirement for persons who are severely and permanently disabled.
- The claimant and/or the claimant’s spouse has not previously been granted the property tax relief provided by section 69.5. The sole exception to this requirement is if relief was first granted for age, relief can be granted a second time if the claimant or claimant’s spouse subsequently becomes severely and permanently disabled, and has to move because of the disability.
- The original property was eligible for the homeowner’s exemption or the disabled veterans’ exemption either at the time it was sold or within two years of the purchase or new construction of the replacement dwelling.
- As a result of its transfer, the original property must (1) be subject to reappraisal at its current full cash value in accordance with sections 110.1 or 5803; or (2) receive a base year value determined in accordance with section 69 (intra-county disaster relief), section 69.3 (intercounty disaster relief), or section 69.5 because the original property qualified as a replacement property under one of those sections.
- The replacement dwelling is purchased or newly constructed within two years of (before or after) the sale of the original property.
- The replacement dwelling must be eligible for the homeowner’s exemption at the time the claim is filed.
- The replacement dwelling must be of equal or lesser value as compared to the original property. This means that the full cash value of the replacement dwelling on the date of purchase or completion of new construction must not exceed:
- 100 percent of the full cash value of the original property as of the date of sale, if the replacement dwelling is purchased or newly constructed prior to the date of sale of the original property,
- 105 percent of the full cash value of the original property as of the date of sale, if the replacement dwelling is purchased or newly constructed within the first year following the date of the sale of the original property, or
- 110 percent of the full cash value of the original property as of the date of sale, if the replacement dwelling is purchased or newly constructed within the second year following the date of the sale of the original property.
The “full cash value of the original property” includes any inflationary factoring that occurs between the sale of the original property and the purchase of the replacement dwelling. The “full cash value of the replacement dwelling” does not include any inflationary factoring.
- If the original property was substantially damaged or destroyed by misfortune or calamity and sold in its damaged state, the full cash value is determined immediately prior to the misfortune or calamity.
- The claimant must file a claim for property tax relief under this section within three years of the date the replacement dwelling was purchased or the new construction of the replacement dwelling was completed.
The above requirements were taken directly from guidance issued by the State Board of Equalization in 2006. The complete document, which contains additional detailed information and is written in a Q&A format, is available by clicking on this link:
In addition, the ordinance requires an application fee of $500 to the Assessor.
The Assessor is currently developing tools to help real estate professionals, homeowners and others determine if a base year value can be transferred. This will be made available as soon as completed.
If you have any questions, please call Tim Holcomb, Assessor at 530.621.5755 or Assistant Assessor Karl Weiland at 530.621.5757.