HJTA announces support for ACA 9 to reverse new inheritance tax

The Howard Jarvis Taxpayers Association today announced its strongest support for Assembly Constitutional Amendment 9, introduced by Assemblyman Kevin Kiley (R-Granite Bay) on Monday.

ACA 9 would reverse the new inheritance tax on property passed from parents to children, a little-noticed part of Proposition 19 affecting middle-class families that have invested their life’s earnings in a home and limited other real estate. Prop. 19 was narrowly approved by voters in November following a costly ad campaign paid for by the California Association of Realtors that emphasized only the provisions in the measure that aided wildfire victims and seniors seeking to move to a new home.

Proposition 19 repealed Proposition 58, a 1986 measure that passed with the approval of more than 75% of state voters after a unanimous vote of the Legislature placed it on the ballot. Prop. 58 amended the state constitution to permit parents to transfer a home of any value and up to a $1 million of other property—such as a vacation cabin, rental property or small business—without reassessment. Under Prop. 19, those properties would instead be reassessed to market value as of the date of transfer, with only limited exceptions, sharply raising the annual tax bill on long-held family properties.

Proposition 19 similarly repealed Proposition 193, passed overwhelmingly by voters in 1996 to extend the same tax treatment to transfers between grandparents and grandchildren if the children’s parents were deceased.

“The opportunity to own a home is central to the California Dream, but our state’s affordability crisis has put this beyond the reach of too many working families,” Kiley said. “Now, thanks to a Special Interest deal, Californians face a large and unplanned-for tax increase when they pass down property to their children. ACA 9 restores a vital protection that was in place for 35 years.”

“It’s hard to imagine anything more callous than the government sending a giant tax bill to a bereaved family, but thanks to Proposition 19, many California families will have that unfortunate experience,” said Jon Coupal, president of HJTA. “The Howard Jarvis Taxpayers Association is proud to support ACA 9 to reinstate Propositions 58 and 193, reversing this stealth tax increase on California families.”