Online resource center to help you explore these key issues, and others, regarding your estate.

Practice Areas

Mr. Miller has many years of experience in designing and implementing a comprehensive variety of Trusts, Wills, and other estate planning documents, as well as settling estates in the most expedient and appropriate method. Further, he counsels and assists clients on becoming eligible for VA benefits and Medi-Cal.

Learn more
VA Pension/Aid & Attendance/Medi-Cal

Mr. Miller has been active in the area of VA Pension and Medi-Cal for well over a decade. He uses various specialized types of Trusts as well as non-trust strategies to gain eligibility for his clients and save the family money.

Learn more
Probate & Estate Administration

Mr. Miller has been settling estates (both simple and complex) for well over 40 years. The starting point is always to create a strategy to settle the estate in the most efficient manner possible with a minimum of taxes. Often times the strategy created allows the family to bypass Probate Court proceedings.

Learn more

California Property Tax and Prop 13…


By merv,

  Filed under: Blog, Elder Law, Estate Planning

In 1978 California voters approved Proposition 13 to rein in property taxes that had doubled in 10 years. The measure was the inspiration for an anti-tax movement that has taken hold of the public discourse in Washington and in state legislatures throughout the country. Prop 13 caps the county real estate property tax at 1 percent of its value when it last changed hands (i.e. change of ownership).  Prior to Prop 13, real estate was taxed at its current market value.  During real estate booms, the tax kept on rising along with the value.  This situation had the effect of forcing many out of their homes because they could no longer afford the property tax.  However, along with the cap on tax comes potential budget problems.

Business Week discusses in depth some of California’s budget problems arsing as the unintended consequences of Prop 13.  One of the major impacts of Prop 13 has been on education. In addition to its effect on elementary schools, California had to cut support for public universities by 18 percent to $4.5 billion this year, according to the California finance department. California’s general- fund backed debt has risen to $82.6 billion from $2.25 billion in 1978, state figures show. California carries more debt than any other state and ranks eighth on a per-capita basis, with $2,542 for each resident, Moody’s Investors Service has said.

Prop 13 is heavily tied into estate planning. It protects real estate from reassessment (and thereby a higher property tax) when the property is passed between parent and child and, sometimes, between grandparent and grandchild.  This protection can generate an enormous savings.  Consider a parent who purchased a home in 1975 for $75,000 and whose home is now worth $575,000.   If this home is passed to the child, it will typically retain the property tax “value” that the parent held.  That is a difference of $500,000  Given that property tax is approximatley 1% of the tax value, then that equates to a savings of $5000 per year.

Avoiding probate is a desire of most people.  But proper planning goes so much further than that.  It requires a consideration of all of the different taxes involved as well as who gets what and how it will all work out efficiently.  Take a look at my Frequently Asked Questions Page on Estate Planning for more on this topic.

Comments are closed.

About Living Trusts

About Living Trusts is hosted by the Law Offices of Merwyn J. Miller, as your online resource center to help you explore these key issues, and others, regarding your estate.

Merwyn J. Miller, J.D.

  • Board Certified Specialist in Estate Planning, Trust & Probate Law
  • Co-Author of legal text book and of “Don’t Go Broke in a Nursing Home
  • Teacher of law courses at public and private colleges
  • Continuing Education Instructor for attorneys
  • Columnist for largest regional newspaper in San Diego County and professional journals for 15 years, Contributing author to the book “In Your Service: The Veteran’s Friend”
  • Masters Degree in Financial Services - Estate Planning
Amazon
Journals
News
Testimonials

Previous Next
Free Consultation

Call 760-436-8832


Math Captcha 7 × 1 =
In light of recent events, we have closed our physical office and our staff is continuing work remotely. We have web conference and telephone available to our clients. For more information, please reach out to us today.Contact us