My assets, including my house, are in a revocable trust, with my three children as heirs. My current property taxes are based on Prop.13. When I die, will the Prop.13 rate roll over to my heirs or will their property taxes be based on the value of the house at my death?
Donna, Citrus Heights
A: Upon your death, your trustee will be required to file a document known as a "Change in Ownership Statement Death of Real Property Owner" with the County Assessor for the county in which your property is located. This statement must be filed within 150 days of the death of the property owner.
In general, if the change in ownership statement shows that the transfer is from a parent to a child, the assessor will mail to the trustee for completion a Claim for Reassessment Exclusion for Transfer Between Parent and Child. This is commonly known as the "Prop. 58" form. It allows a child to claim exclusion from property tax reassessment for the parent's principal residence and up to $1 million of full cash value of all other real property.
So, if your house is transferred to all three of your children through your trust at your death, and the trustee properly claims the exemption, there will be no increase in the property taxes for the exempt property.