In a recent interview, Susan Shelley, a prominent California columnist and member of the editorial board of the Southern California News Group, sheds light on a lesser-known consequence of recent legislation: the imposition of a new death tax on inherited properties in California. Here are the key points from Shelley’s insightful discussion:
In a recent interview, Susan Shelley, a prominent California columnist and member of the editorial board of the Southern California News Group, sheds light on a lesser-known consequence of recent legislation: the imposition of a new death tax on inherited properties in California. Here are the key points from Shelley’s insightful discussion:
The Stealthy Death Tax:
California has quietly introduced a new death tax on property, affecting individuals who have recently lost a parent. This tax significantly impacts the transfer of property from parents to children, deviating from decades-long practices.
Reassessment of Property Values:
Traditionally, inherited property, including homes and up to a million dollars in assessed value of other properties, could be transferred without a change in the tax bill. However, the new law requires a reassessment of inherited property to its current market value, potentially leading to substantial annual tax increases for the new property owners.
Immediate and Crushing Consequences:
Shelley emphasizes the immediate financial burden imposed on individuals inheriting property. Without swift action, families may face annual tax increases ranging from two or three thousand dollars to as much as fifteen or twenty thousand dollars, placing a heavy strain on those with limited financial means.
Origins in Proposition 19:
The controversial tax increase was quietly slipped into Proposition 19 in 2020, a measure initially framed as a means to protect wildfire victims. However, the fine print revealed an additional burden on those inheriting property, sparking a call for its reversal.
Historical Context:
Shelley provides a historical perspective on the issue, highlighting the repeal of Proposition 58 and Proposition 193 by Proposition 19. These earlier propositions, passed in the late 20th century, protected parent-child and grandparent-grandchild property transfers from reassessment.
The Urgent Call for Repeal:
Shelley urges Californians to support the “Repeal the Death Tax” initiative, emphasizing its retroactive nature. The initiative aims to reinstate the parent-child transfer exclusion and the grandparent-grandchild exclusion, providing relief to those affected since February 2021.
In conclusion, Susan Shelley’s interview sheds light on a pressing issue affecting Californians who inherit property. The call to action is urgent, with a need for a million signatures by the end of January to place the initiative on the November 2024 ballot. Repealing the death tax is framed not only as a financial necessity for affected families but also as a means to preserve affordable housing, small businesses, and cherished family legacies. For more information and to contribute to the initiative, visit RepealTheDeathTax.com.
Views expressed in this video/article are opinions of the author and do not necessarily reflect the views of California Insider.
