When you inherit a home from your parents, you may be able to keep the same low property tax base they had. That relief is the parent-child exclusion. It used to come from Proposition 58 and it now comes from Proposition 19, which applies to transfers on or after February 16, 2021. The current rules are narrower than the old ones, so it pays to know them before a parent dies.
What the exclusion does
If your parents bought in, say, 1980, their assessed value is a fraction of today's market value. A change in ownership normally reassesses a property to market value and your tax bill could skyrocket. The exclusion lets the child keep the parents' assessed value instead, as long as the rules are met.
The rules to meet
It must have been your parent's principal residence.
Rentals, vacation homes and most other real estate no longer qualify.
You must move in.
The home must become your primary residence within one year of the transfer.
You must file for the homeowners' exemption.
Then you file the exclusion claim form (BOE-19-P) with the county assessor, generally within three years of the transfer and before you transfer the property to anyone else.
There is a value cap.
If the market value is more than your parents' assessed value plus $1,044,586 (the inflation-adjusted figure for transfers from February 16, 2025 through February 15, 2027), the excess is added to your taxable value.
File the forms
The exclusion is not automatic. The assessor may want to see the living trust or other document that passed the property to you and will confirm the parent-child relationship. If you do not file, your property taxes may go way up.
See also: Keeping it in the family: how Proposition 19 affects Santa Clarita real estate inheritance. Source: California State Board of Equalization, Letter To Assessors 2025/015.