Prop 19 and Inherited Homes: Parent-Child Transfers and Reassessment
Under Proposition 19, a California home passed from a parent to a child keeps the parent’s property tax value only if it was the parent’s principal residence and becomes the child’s, with a homeowners’ exemption filed within one year. Even then, the exclusion is capped: for transfers from February 16, 2025 through February 15, 2027, it covers up to $1,044,586 of market value above the parent’s factored base year value, and any value beyond that is added to the taxable value. Rentals, vacation homes and other property that isn’t a family home or family farm are reassessed to market value.
Prop 19’s intergenerational rules apply to transfers on or after February 16, 2021. Transfers on or before February 15, 2021 fell under the older Propositions 58 and 193, and the Board of Equalization (BOE) says those earlier transfers will not be reassessed now.
This page covers the inheritance side of Prop 19: who qualifies, how the cap works with an example, the forms and deadlines, trusts and siblings, and what changes if the heirs rent or sell instead. It sits alongside our home-selling process guides; owners 55 and older moving their own tax base should read our Prop 19 base year transfer guide.
What counts as a family home
Revenue and Taxation Code section 63.2 defines a family home as a dwelling eligible for the homeowners’ or disabled veterans’ exemption based on the transferor’s ownership and occupancy, plus only the reasonably sized land used as its site. In plain terms, the parent must have lived there as a principal residence.
The child’s side has three requirements:
- Move in within one year. The BOE’s Publication 800-1 says that if move-in doesn’t happen within one year of the transfer, the property does not qualify, and it lists no exception.
- File the exemption within one year. The homeowners’ exemption (BOE-266) or the disabled veterans’ exemption (BOE-261-G) must be filed within one year of the death or transfer. The BOE says a late exemption filing means the exclusion applies only going forward.
- Keep living there. At least one eligible child must continue to occupy the home as a family home for the exclusion to last.
“Children” is broader than it sounds. Section 63.2 includes biological children, stepchildren, certain sons- and daughters-in-law, children adopted before age 18 and certain foster children. Grandchildren qualify only if the parent who is the grandparent’s child is deceased on the transfer date, as the BOE puts it.
How the $1,044,586 exclusion works
The new taxable value is the parent’s factored base year value plus any market value above that value plus the exclusion amount. If the home’s market value is less than the factored base year value plus the exclusion, nothing is added.
The exclusion started at $1,000,000 and is adjusted every other year by the BOE using the Federal Housing Finance Agency’s House Price Index for California:
| Date of transfer | Exclusion amount |
|---|---|
| February 16, 2021 to February 15, 2023 | $1,000,000 |
| February 16, 2023 to February 15, 2025 | $1,022,600 |
| February 16, 2025 to February 15, 2027 | $1,044,586 |
For an inheritance, the date that matters is the date of death, not the date the estate or trust distributes the house.
A worked example
Say a parent dies in 2026 owning a Santa Rosa home with a factored base year value of $400,000, and the home is worth $1,600,000 on the date of death. One child moves in within the year and files the homeowners’ exemption. On our arithmetic:
- Factored base year value plus the exclusion: $400,000 + $1,044,586 = $1,444,586.
- Market value above that figure: $1,600,000 − $1,444,586 = $155,414.
- New taxable value: $400,000 + $155,414 = $555,414.
The BOE’s own examples apply a 1% rate to show the effect. At 1%, that is roughly $5,554 a year instead of about $16,000 at a full reassessment to $1,600,000, before local voter-approved charges. Your county assessor sets the actual figures, and the house will need a date-of-death valuation either way.
Forms and deadlines
| Form | What it is for | Deadline |
|---|---|---|
| BOE-19-P | Claim for reassessment exclusion, parent to child | Within three years of the death or transfer, or before a transfer to a third party, whichever is earlier |
| BOE-19-G | Claim for reassessment exclusion, grandparent to grandchild | Same as BOE-19-P |
| BOE-266 or BOE-261-G | Homeowners’ or disabled veterans’ exemption for the child who moves in | Within one year of the death or transfer |
The claims are filed with the county assessor where the property sits, not with the BOE. Section 63.2 also treats a claim as timely if it is filed within six months after the assessor mails a supplemental or escape assessment notice for the transfer, and it ends the window early if the child stops living there. File both forms as soon as the move-in is real; waiting costs money because the exemption only applies prospectively when late.
Trusts, probate and timing
Many inherited homes pass through a living trust or probate, and Prop 19 applies to both. Publication 800-1 says the exclusion can cover property held in trust where the children are the beneficiaries on the parent’s death. The BOE adds that a revocable trust generally changes ownership when it becomes irrevocable, usually at death, so the date of death is the change in ownership date.
That matters for the one-year clock. A trustee may need months to settle the estate, but the child’s move-in and exemption deadlines run from the date of death.
If one child plans to keep the house, the trustee and heirs should decide early and get the move-in done within the year. Our guides to selling a house held in a trust and selling a house in probate cover the process if the decision is to sell.
Several heirs, one house
Only one child has to live in the home. The BOE says multiple children can receive it, and if the child living there moves out and another eligible child moves in within one year, the exclusion continues, as long as the new occupant also files for the exemption.
Buyouts are where heirs get caught. Publication 800-1 says the exclusion is not available for transfers between siblings, so if one sibling buys out the others, the share transferred between siblings is reassessed.
How a trust is drafted and how the trustee distributes the house can change the result, so have an estate attorney review the plan before anyone signs a deed. When heirs can’t agree, our article on co-owners who disagree about selling and our guide to partition actions cover the options.
Family farms
Prop 19 also excludes transfers of a family farm, defined in section 63.2 as land under cultivation, used for pasture or grazing, or used to produce an agricultural commodity. The BOE applies the same $1,044,586 cap to farms, and its Publication 800-1 says no home is required on the land. The farm also has to stay a farm: the BOE’s Letter To Assessors No. 2026/026 (August 3, 2026) says an eligible transferee must keep using it as a family farm, or the exclusion is removed from the date that use ends.
Each legal parcel may qualify separately, and a parcel with the family home on it may qualify as a family home instead. Vineyard and ranch families should map which parcels are farmed and which hold the residence before filing; our vineyard and winery team can help with the property side.
If you rent the house or sell it
A rental is reassessed. If the child never moves in, the home is reassessed to its market value as of the date of death.
If the child moves in and later moves out, the BOE says the exclusion is removed and the home gets a new taxable value as of the next January 1 lien date: the market value on the inheritance date, adjusted for inflation. Renting an inherited house also brings tenant rules; see our pages on inherited rental property and AB 1482 for landlords.
Selling is often simpler. A buyer is reassessed to the purchase price regardless, so Prop 19 mainly affects heirs who keep the house.
For income tax, federal law generally gives inherited property a basis equal to its fair market value on the date of death (26 U.S.C. section 1014), which can shrink the gain on a prompt sale. Our guide to capital gains on a California home sale covers the income tax side.
| Path | Property tax result | What to do first |
|---|---|---|
| Keep and move in | Parent’s value plus any excess over the exclusion | Move in and file BOE-19-P and BOE-266 within the year |
| Keep and rent | Reassessed to market value as of the date of death | Budget the higher tax and review tenant rules |
| Sell | The buyer is reassessed; no exclusion needed | Get a date-of-death value and a pricing plan |
For the wider keep-rent-or-sell decision, start with our guide to inheriting a house in California.
This is general information, not legal or tax advice; talk to a California estate planning attorney, a tax adviser or your county assessor about your situation.
Questions people ask
Does Prop 19 apply to an inherited rental property?
Not as an exclusion. Prop 19 limits the parent-child exclusion to a family home and family farms, so a rental or second home is reassessed to market value as of the date of death.
What is the Prop 19 exclusion amount in 2026?
$1,044,586 for transfers from February 16, 2025 through February 15, 2027, according to the Board of Equalization. It is adjusted every two years.
How long do I have to move into an inherited home under Prop 19?
One year from the transfer, which for an inheritance is the date of death. You must also file the homeowners’ or disabled veterans’ exemption within that year.
Do all the siblings have to live in the house?
No. Only one eligible child needs to live there and claim the exemption. But a buyout between siblings is not covered, so the share bought from a sibling is reassessed.
When is the BOE-19-P due?
Within three years of the death or transfer, or before the property is transferred to a third party, whichever comes first. It is filed with the county assessor.
Does Prop 19 apply if the house is in a living trust?
Yes, if the children are the beneficiaries when the parent dies. The date of death is treated as the change in ownership date, even if the trustee distributes the house later.
What happens if I move out later?
The exclusion ends. The home is reassessed as of the next January 1 lien date to its market value on the inheritance date, adjusted for inflation.
Can grandchildren use Prop 19?
Only if the grandchild’s parent who is the grandparent’s child is deceased on the transfer date. The claim form is BOE-19-G.
If you have inherited a home and are weighing whether to keep it, rent it or sell it, we can give you a current value and a clear picture of the sale side before you decide; see our probate and trust sales services or request a home valuation.
Sources & notes
- California State Board of Equalization: Proposition 19
- California State Board of Equalization: News release NR 25-02, adjusted family home exclusion amount
- California State Board of Equalization: Publication 800-1, Prop 19 parent-child and grandparent-grandchild transfers (5-25)
- California Public Law: Revenue and Taxation Code section 63.2
- California State Board of Equalization: Letter To Assessors No. 2026/026, Prop 19 intergenerational transfer FAQs (Aug. 3, 2026)
- Cornell Legal Information Institute: 26 U.S. Code section 1014
Last reviewed October 2026 by Matthew Martinez.
