The State Board of Equalization adopted a rule exempting real property transfers to registered domestic partners via intestate succession from the definition of “change of ownership” under Proposition 13. In Strong v. State Board of Equalization, case no. C052818 (3d Dist. Oct. 2, 2007) County assessors claimed the rule was unconstitutional because such exceptions can only be implemented by constitutional amendment. The court disagrees. Proposition 13 bases property taxes on value at the time of acquisition of the property, and a reassessment is triggered by a change in ownership. Here, the State Board of Equalization extended to domestic partners an exception to the definition of “change in ownership” similar to…
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Life Estates and Proposition 13
Since Proposition 13 (passed by initiative in 1978) changed the property tax system in California from one based on current assessed value to one based on assessed value at the time of acquisition, the issue of whether a change in title is a change in ownership for purposes of Proposition 13 haunts every transaction, as it can mean a huge increase in property taxes. In Steinhart v. County of Los Angeles, case no. B190957 (2d Dist. Sept. 28, 2007), the Court of Appeal faced the issue of “whether Steinhart’s acquisition of a life estate in real property upon the death of her sister constituted a change of ownership so as…