2nd Public Service about Property Taxes…may even save you money!

[SD Realtor]

I was talking to a client today who is in a pickle… Most of my conversations are like this now… sellers who are in distress and think about turning the home to a rental rather then selling and getting hammered. Even though my advice is to take the bitter pill and swallow it now… some people just cant do that for whatever reasons…

Anyways I was looking through her expenses on this home… I did notice that she and her sister obtained the home from her parents. Her parents in term had bought the home and when they bought it, they were eligible and indeed did carry the property tax basis from thier original home. So the parents had a pretty smoking basis for terms of property tax calculations. Now I noticed that the person I was talking to had a large property tax bill…

Well it seems she did not take advantage of the Parent Child exclusion! I guess it is not that well known but there is an exclusion that when real property is transferred between parents and children the property can be transferred without a tax increase. Now the transfer took place less then 3 years ago so I believe she can go to the county to get things straightened out.

FSD I am relying on you to confirm or deny my presumption here. Now of course I told her to consult a CPA on this but giving the old county a call couldn’t hurt.

Every now and then I have read posts of people talking about transfers from thier parents or grandparents.

For exemptions of property tax for san diego county go to:

http://www.sdtreastax.com/pt_exem_excl.html

You never know what you may find.

[Coronita]

SD R, do you know if there is such a deal to transfer property from an individual to a corporation or foundation that you establish? Just curious if the property transfer could be essentially passed down generation to generation or even skip the parent-child transfer.

 

 

 

[Coronita]

SD R, do you know if there is such a deal to transfer property from an individual to a corporation or foundation that you establish? Just curious if the property transfer could be essentially passed down generation to generation or even skip the parent-child transfer.

 

 

 

[Coronita]

SD R, do you know if there is such a deal to transfer property from an individual to a corporation or foundation that you establish? Just curious if the property transfer could be essentially passed down generation to generation or even skip the parent-child transfer.

 

 

 

[Coronita]

SD R, do you know if there is such a deal to transfer property from an individual to a corporation or foundation that you establish? Just curious if the property transfer could be essentially passed down generation to generation or even skip the parent-child transfer.

 

 

 

[Coronita]

SD R, do you know if there is such a deal to transfer property from an individual to a corporation or foundation that you establish? Just curious if the property transfer could be essentially passed down generation to generation or even skip the parent-child transfer.

 

 

 

[SD Realtor]

FSD blows me out of the water on questions like this. Other guys like Surveyor and 4plex also are probably better versed. My short answer is that you may be able to do that. For instance many people who have rentals put them in S corps they establish for liability reasons and I would “think” that the transfer is made without a property tax change. I know that is not answering your question directly but I gotta give ya the ask a CPA answer….

SD Realtor

[SD Realtor]

FSD blows me out of the water on questions like this. Other guys like Surveyor and 4plex also are probably better versed. My short answer is that you may be able to do that. For instance many people who have rentals put them in S corps they establish for liability reasons and I would “think” that the transfer is made without a property tax change. I know that is not answering your question directly but I gotta give ya the ask a CPA answer….

SD Realtor

[SD Realtor]

FSD blows me out of the water on questions like this. Other guys like Surveyor and 4plex also are probably better versed. My short answer is that you may be able to do that. For instance many people who have rentals put them in S corps they establish for liability reasons and I would “think” that the transfer is made without a property tax change. I know that is not answering your question directly but I gotta give ya the ask a CPA answer….

SD Realtor

[SD Realtor]

FSD blows me out of the water on questions like this. Other guys like Surveyor and 4plex also are probably better versed. My short answer is that you may be able to do that. For instance many people who have rentals put them in S corps they establish for liability reasons and I would “think” that the transfer is made without a property tax change. I know that is not answering your question directly but I gotta give ya the ask a CPA answer….

SD Realtor

[SD Realtor]

FSD blows me out of the water on questions like this. Other guys like Surveyor and 4plex also are probably better versed. My short answer is that you may be able to do that. For instance many people who have rentals put them in S corps they establish for liability reasons and I would “think” that the transfer is made without a property tax change. I know that is not answering your question directly but I gotta give ya the ask a CPA answer….

SD Realtor

[CA renter]

SDR,

I’m not a realtor nor a lawyer, but recently filed a PC Exclusion myself, so looking at the pamphlet…

You said they obtained the property from their parents but didn’t specify if it was an inheritance or transfer or sale or??

If the parents simply transferred it, and they (parents) also applied for a Reappraisal Exclusion for Seniors on their next residence (assuming they just moved from that house to another), it seems the children couldn’t apply for a Parent-Child Exclusion on the transferred house. The parents would have transferred the low tax basis to the next property.

Also, regarding corporate holdings or partnerships, they appear not to qualify for the Parent-Child Exclusion. But properties held in trusts do seem to qualify.

Again, not an attorney, so ask an attorney if seeking legal advice!

[CA renter]

SDR,

I’m not a realtor nor a lawyer, but recently filed a PC Exclusion myself, so looking at the pamphlet…

You said they obtained the property from their parents but didn’t specify if it was an inheritance or transfer or sale or??

If the parents simply transferred it, and they (parents) also applied for a Reappraisal Exclusion for Seniors on their next residence (assuming they just moved from that house to another), it seems the children couldn’t apply for a Parent-Child Exclusion on the transferred house. The parents would have transferred the low tax basis to the next property.

Also, regarding corporate holdings or partnerships, they appear not to qualify for the Parent-Child Exclusion. But properties held in trusts do seem to qualify.

Again, not an attorney, so ask an attorney if seeking legal advice!

[CA renter]

SDR,

I’m not a realtor nor a lawyer, but recently filed a PC Exclusion myself, so looking at the pamphlet…

You said they obtained the property from their parents but didn’t specify if it was an inheritance or transfer or sale or??

If the parents simply transferred it, and they (parents) also applied for a Reappraisal Exclusion for Seniors on their next residence (assuming they just moved from that house to another), it seems the children couldn’t apply for a Parent-Child Exclusion on the transferred house. The parents would have transferred the low tax basis to the next property.

Also, regarding corporate holdings or partnerships, they appear not to qualify for the Parent-Child Exclusion. But properties held in trusts do seem to qualify.

Again, not an attorney, so ask an attorney if seeking legal advice!

[CA renter]

SDR,

I’m not a realtor nor a lawyer, but recently filed a PC Exclusion myself, so looking at the pamphlet…

You said they obtained the property from their parents but didn’t specify if it was an inheritance or transfer or sale or??

If the parents simply transferred it, and they (parents) also applied for a Reappraisal Exclusion for Seniors on their next residence (assuming they just moved from that house to another), it seems the children couldn’t apply for a Parent-Child Exclusion on the transferred house. The parents would have transferred the low tax basis to the next property.

Also, regarding corporate holdings or partnerships, they appear not to qualify for the Parent-Child Exclusion. But properties held in trusts do seem to qualify.

Again, not an attorney, so ask an attorney if seeking legal advice!

[Author]

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