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sduuuude – this is one of the major loopholes with Prop 13 – commercial real estate is rarely re-assessed for tax basis because the property is sold inside the corp and, for tax purposes, did not get ‘sold’
being unable to increase the tax basis on existing commercial real estate is one of the motivations for cities to approve more strip malls, housing tracts, etc – new construction means new tax income at the current tax basis
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4plexowner. Please clarify. What do you by “real estate” being sold within the corp? Do you mean ownership of the corp itself changing hands or something else. Forgive the ignorance.
This might be interesting from an inheritance perspective as well. I wonder whether it skirts some of the inheritance taxes. I guess I’ll need to consult a CPA/lawyer for details on that. (I think RE passed down to your kids via a trust also doesn’t trigger a prop reassessment, but I could be wrong).
