California’s Callous Death Tax Act
There are few moments in life more painful than the death of a loved one. A little more than a year ago, California’s new Proposition 19 made those moments even more painful.
Proposition 19, which passed by a narrow margin in 2020, reinstated the death tax, making it far more difficult for hard-working Californians to inherit family homes and businesses.
Before the passage of Proposition 19, the state constitution allowed parents and grandparents to pass down property to their children and grandchildren, without worrying that the inheritance would be swallowed up by a huge tax increase. The constitution guaranteed that inherited properties would not be subject to a tax reassessment.
In other words, if a family farm was on land that had soared in value over the years, the owner would still be able to leave the land to his grandchildren, without worrying that they would be unable to afford taxes on the reassessed land. The grandchildren would only be subject to a modest annual tax increase. That’s what allowed families to go on farming their land, operating small businesses, and living in their ancestral homes.
Proposition 19 Changed All of That
Proposition 19 capped the value of the property that parents and grandparents may bequeath without a major tax increase. The proposition amended the state constitution so that any inherited property valued at one million dollars or more must be reassessed for taxes.
The result? Many families are now questioning whether they can afford to keep living on the land they’re inheriting. Proposition 19 is creating endless questions and a great deal of anxiety.
Fortunately, the Howard Jarvis Taxpayers Association, or HJTA, is working to restore the protections that families and taxpayers deserve., and has introduced a new ballot initiative called the Repeal the Death Tax Act.
The Repeal the Death Tax Act would reverse Proposition 19 by amending the state constitution once again and reinstating the rights of Californians. Once again, parents and grandparents will be able to pass down their home or business to their children and grandchildren, without a huge increase in taxes.
In fact, the Repeal the Death Tax Act goes one step further, by increasing the taxable value exemption to $2.4 million. That figure will be automatically adjusted in the future to account for inflation.
Hard-working families deserve protection under the law. They have the right to know that the sacrifices and work of a lifetime aren’t going to waste. They deserve to feel secure in the knowledge that they can leave something valuable to their children and grandchildren. That’s why it’s so important to make sure that Proposition 19 is overturned and that the Repeal the Death Tax Act is passed.
The recent changes to inheritance law have left many families struggling to understand their rights. HCS Equity can help provide answers to questions and can provide guidance to anyone seeking to navigate through the changing legal landscape. Get in touch today to learn more about what HCS Equity can do.