property tax - Linkenheimer LLP CPAs & Advisors

Californians Approve Prop. 19; Ending Major Property Tax Exemption

Californians narrowly passed Proposition 19 earlier this month with a 2% margin, essentially ending your ability to transfer real estate to your children free of property tax reassessment. The proposition has two fairly distinct parts. The first allows homeowners who are 55 or older or those who lost their home in a natural disaster to transfer their tax assessment to a new home. The tax value of the new home will be added to the current tax assessment if the new home is more expensive, a transfer like this can be done three times and homeowners have two years to sell their current home and buy a new one.

The second part of Proposition 19 removes the ability for a parent to pass a home to a child or grandchild without reassessing the home value, unless it’s the child’s or grandchild’s primary residence. If the child or grandchild doesn’t live in the inherited home and instead chooses to rent it out, the tax value can be reassessed. Previously, a home could be transferred to family members and […]

By Linkenheimer LLP|2020-11-20T00:20:46+00:00November 20th, 2020|property tax|0 Comments

Penalties For Late Property Tax Payments In California Will Be Waived

Due to the coronavirus (COVID-19) pandemic, penalties and other charges for late property tax payments in California will be waived. The CA Association of County Treasurers and Tax Collectors (CACTTC) has issued a statement regarding the April 10 tax collection deadline for the second installment of property tax for the 2019-2020 fiscal year. While the CACTTC cannot change the deadline, it can provide relief from the penalties, cost or other charges resulting from tax delinquency due to reasonable cause related to the crisis. The statement also encourages taxpayers to pay electronically. If you have questions, please reach out to your Linkenheimer CPA for help. See answers to frequently asked questions from the CACTTC here: https://bit.ly/3aysXvT

By Linkenheimer LLP|2020-09-03T20:03:09+00:00April 8th, 2020|property tax|0 Comments

California Announces the Property Tax Postponement (PTP) Program

The California State Controller has announced it is taking applications from certain homeowners for property tax deferments. It’s called the Property Tax Postponement (PTP) Program. For the 2019-2020 tax year, homeowners who are seniors or blind, or have a disability, and who meet income, equity and other requirements, can postpone payment of property taxes on their primary residence. Manufactured homes are now also eligible. Funding is limited, and applications will be processed in the order received, beginning Oct. 1. Participants must reapply each year and prove they are still eligible. If you have questions, please contact your Linkenheimer CPA. For details of this new program, call (800) 952-5661 or visit the Controller’s website: https://bit.ly/2mrYGLp

By Linkenheimer LLP|2020-09-03T20:03:36+00:00October 2nd, 2019|property tax|0 Comments

Thinking About Moving to Another State in Retirement? Don’t Forget About Taxes

When you retire, you may consider moving to another state — say, for the weather or to be closer to your loved ones. Don’t forget to factor state and local taxes into the equation. Establishing residency for state tax purposes may be more complicated than it initially appears to be.

Identify all applicable taxes

It may seem like a no-brainer to simply move to a state with no personal income tax. But, to make a good decision, you must consider all taxes that can potentially apply to a state resident. In addition to income taxes, these may include property taxes, sales taxes and estate taxes.

If the states you’re considering have an income tax, look at what types of income they tax. Some states, for example, don’t tax wages but do tax interest and dividends. And some states offer tax breaks for pension payments, retirement plan distributions and Social Security payments.

Watch out for state estate tax

The federal estate tax currently doesn’t apply to many people. For 2019, the federal estate tax exemption is $11.4 million ($22.8 million for a married couple). But some states levy estate tax with a much lower exemption and […]

By Linkenheimer LLP|2020-09-03T20:03:55+00:00June 6th, 2019|property tax, retirement, sales tax, tax planning, taxes|0 Comments

Does Prepaying Property Taxes Make Sense Anymore?

Prepaying property taxes related to the current year but due the following year has long been one of the most popular and effective year-end tax-planning strategies. But does it still make sense in 2018?

The answer, for some people, is yes — accelerating this expense will increase their itemized deductions, reducing their tax bills. But for many, particularly those in high-tax states, changes made by the Tax Cuts and Jobs Act (TCJA) eliminate the benefits.

What’s changed?

The TCJA made two changes that affect the viability of this strategy. First, it nearly doubled the standard deduction to $24,000 for married couples filing jointly, $18,000 for heads of household, and $12,000 for singles and married couples filing separately, so fewer taxpayers will itemize. Second, it placed a $10,000 cap on state and local tax (SALT) deductions, including property taxes plus income or sales taxes.

For property tax prepayment to make sense, two things must happen:

You must itemize (that is, your itemized deductions must exceed the standard deduction), and
Your other SALT expenses for the year must be less than $10,000.

If you don’t itemize, or you’ve already used up your $10,000 limit (on income or sales taxes or on previous property […]

By Linkenheimer LLP|2020-09-03T20:04:24+00:00December 7th, 2018|New Tax Laws, property tax|0 Comments