An initiative passed narrowly by voters in 2020 to protect wildfire victims and seniors has opened the door to massive tax increases that threaten tenants and the roof over their heads.
Proposition 19 removed important taxpayer protections from the state constitution that for 35 years guaranteed that parents or grandparents could transfer property to their kids without any change to the property tax bill. The removal of these protections has brought back the death tax to California. Now, when property is passed from parent to child, it is reassessed to current market value, triggering a huge increase in annual property taxes. Too often, renters find themselves collateral damage to this untimely tax increase.
So, how does the death tax impact tenants? The answer is simple. Take for example Isabella, who rents a house from a mom and pop landlord. The rental was previously occupied by her landlord, Henry, and he kept it as a small investment property. Henry has personally made repairs on the rental property for more than 40 years and has kept the rent affordable for Isabella and previous tenants. Due to the death tax, when Henry passes away the home will be reassessed, property taxes increased, and his children will receive a huge tax bill — resulting in higher rent for Isabella or forcing the children to sell the property. Either way, Isabella faces losing her home as a result of the death tax.
Click here to read more at Los Angeles Daily News.
