California’s parent-child property tax reassessment exclusion lets a family home pass from parent to child without the county resetting its assessed value to current market value, so the child can keep paying property tax on roughly the same basis the parent had. It applies to transfers on or after February 16, 2021, under Proposition 19 and Revenue and Taxation Code Section 63.2, and it requires the child to use the home as a primary residence. A valuation cap limits how much value the exclusion shields; anything above the cap triggers a partial reassessment rather than a full one.1California Legislative Information. California Revenue and Taxation Code 63.2
Who Counts as a Parent or Child
The exclusion runs in both directions between parents and children. “Children” includes biological offspring, children adopted before age 18, stepchildren, and sons- or daughters-in-law. The parent side mirrors that list: biological parents, adoptive parents, stepparents, and parents-in-law.2California State Board of Equalization. Proposition 19 Fact Sheet
In-law and stepparent relationships are only valid while the underlying marriage exists. Divorce ends the qualifying relationship. If the spouse who created the connection dies, the relationship survives for exclusion purposes unless the surviving spouse remarries.2California State Board of Equalization. Proposition 19 Fact Sheet
Sibling-to-sibling transfers never qualify. When one sibling buys out another’s share of an inherited home, the purchased share is reassessed at market value.
What Kind of Property Qualifies
Only a family home or a family farm qualifies. Vacation homes, rentals, and other investment properties are excluded.
A family home must have been the transferor’s primary residence, and the child receiving it must use it as their own primary residence within one year of the transfer. The child proves that use by filing for the homeowners’ exemption or the disabled veterans’ exemption within the same one-year window.2California State Board of Equalization. Proposition 19 Fact Sheet
A family farm is real property used for cultivation, pasture, grazing, or producing agricultural commodities. Unlike a home, a farm does not need a residence the child lives in.2California State Board of Equalization. Proposition 19 Fact Sheet
The Valuation Cap
The exclusion shields the property’s existing tax basis (its factored base year value) plus a buffer that adjusts for inflation every two years. For transfers between February 16, 2025, and February 15, 2027, that buffer is $1,044,586.2California State Board of Equalization. Proposition 19 Fact Sheet
If the market value at transfer is at or below the parent’s tax basis plus $1,044,586, nothing is reassessed. The child inherits the parent’s basis and keeps paying roughly the same property taxes. If market value exceeds that threshold, only the excess gets added to the basis.
An example: a parent’s factored base year value is $200,000 and the market value at transfer is $1,500,000. The threshold is $200,000 plus $1,044,586, or $1,244,586. The amount over the threshold is $255,414. The child’s new assessed value becomes $455,414 rather than the full $1,500,000 that would apply without the exclusion.
The cap applies parcel by parcel, so a farm spanning several legal parcels is evaluated separately for each.1California Legislative Information. California Revenue and Taxation Code 63.2
The One-Year Primary Residence Rule
This is where most families lose the benefit. The child has one year from the transfer date to move in and file for either the homeowners’ exemption or the disabled veterans’ exemption. File within that year and the exclusion applies retroactively to the transfer date. Miss it and the exclusion only starts the year the exemption claim is actually filed. Every year in between is assessed at market value, and you cannot recover those higher tax bills.2California State Board of Equalization. Proposition 19 Fact Sheet
How to File the Claim
The application is Form BOE-19-P, Claim for Reassessment Exclusion for Transfer Between Parent and Child Occurring On or After February 16, 2021. Get it from the county assessor’s office or website where the property is located.3California State Board of Equalization. Property Tax Forms for Use by County Assessors Offices and Local Appeals Boards It asks for the Assessor’s Parcel Number, the transfer date, Social Security numbers for the parents and children involved, and information supporting primary-residence status.
Submit the completed form to the county assessor by mail or in person. For a family home, the child must file the homeowners’ or disabled veterans’ exemption before the BOE-19-P is processed.2California State Board of Equalization. Proposition 19 Fact Sheet
The BOE-19-P itself must be filed within three years of the transfer and before the property is sold to an unrelated third party. A claim filed within six months after the assessor mails a supplemental or escape assessment notice for the transfer also counts as timely.2California State Board of Equalization. Proposition 19 Fact Sheet
You can still file after three years if you continue to own the property, but the reduction only applies going forward from the year you file. Nothing gets recovered for the intervening years.
Transfers Through a Living Trust or at Death
Property held in a parent’s revocable living trust qualifies. When the parent dies and the trust distributes the home to the child, it’s treated as a direct transfer, with the date of death as the transfer date.2California State Board of Equalization. Proposition 19 Fact Sheet The child still has to file Form BOE-19-P and claim the homeowners’ or disabled veterans’ exemption within one year of the death.
The exclusion is never automatic. If the child doesn’t file, the assessor reassesses the property at market value. Estate administration is often slow, and the one-year clock can run out while the family is still sorting things out.
Grandparent-to-Grandchild Transfers
Grandparents can transfer a family home or family farm to grandchildren under the same rules, but only if the grandchild’s parents who would have qualified as the grandparents’ children are all deceased at the time of transfer. If even one qualifying parent is still living, the exclusion does not apply and the property is reassessed at market value.1California Legislative Information. California Revenue and Taxation Code 63.2 The exclusion does not run in the other direction; grandchildren cannot transfer to grandparents.
Gift Versus Inheritance and the Later Sale
The California exclusion protects the property tax basis. It does not set the child’s cost basis for federal capital gains purposes when the child later sells, and those two figures behave very differently depending on how the child received the home.
Inherited property gets a stepped-up basis equal to fair market value on the date of death.4Internal Revenue Service. Gifts and Inheritances If the home is worth $900,000 at death and the child later sells for $950,000, the taxable gain is $50,000.
A lifetime gift works differently. The child takes the parent’s original cost basis, known as carryover basis.5Office of the Law Revision Counsel. 26 USC 1015 – Basis of Property Acquired by Gifts and Transfers in Trust A home the parent bought for $150,000 that is now worth $900,000 leaves the child with a $750,000 built-in gain if sold immediately. For highly appreciated homes, inheritance is significantly more tax-efficient than a gift during life, even though both can qualify for the California property tax exclusion.