Who can borrow against a Trust, Estate or Probate property?

Trustees (with the power to encumber trust property), Administrators of estates (with Letters of Administration and Full/Limited Authority), Fiduciaries, and Conservators. Please note, restrictions do apply

Why would a Trust, Estate or Probate need to secure a loan?

[embed]https://youtu.be/LeEd8BmgKZ8[/embed] Trustees, executors, administrators, private fiduciaries, and estate and trust attorneys routinely encounter problems when administering cash-poor trusts, estates or probates after someone passes away. These problems include how to equalize and distribute assets between children so that everyone gets an equal share; how to pay expenses when there is little or no cash in the estate; how to pay off a reverse mortgage that a parent or grandparent has taken out on the home; or how to structure the trust or estate administration so that one beneficiary receives real property while ensuring that the other beneficiaries receive an equal share. Often, there is too little cash in the estate to achieve these goals, and the trustee or executor is forced to sell real property assets in the course of the trust or estate administration in order to raise the money needed. HCS Equity provides private 3rd party loans to create necessary liquidity to retain the applicable property tax exemptions, and can do so in a fraction of the time it takes to prep and sell a property.

What is Proposition 58, the Parent-Child, and 193, the Grandparent-Grandchild Exclusion from Reassessment?

[embed]https://youtu.be/hcGTNoYJ34A[/embed] In the State of California, real property is reassessed at market value if sold or transferred, and property taxes can increase dramatically as a result. However, if the sale or transfer is between parents and their children, or from grandparents to their grandchildren, under specific/limited circumstances, the property will not be reassessed if certain conditions are met, and the proper application is timely filed. These propositions allow the new property owners to avoid property tax increases when acquiring property from their parents or children or from their grandparents. The new owner’s taxes are calculated on the established Proposition 13 base year value, instead of the current market value when the property is acquired. For additional information, please visit the BOE FAQs site: http://www.boe.ca.gov/proptaxes/faqs/propositions58.htm

I still have questions on Proposition 19. Who do I contact to discuss?

If you have further questions, you may call one of our experts at HCS Equity at 877-427-9820.

How do I apply for the homeowners' exemption or disabled veterans' exemption within one year of the transfer to qualify for the parent-child or grandparent-grandchild exclusion, as required by Proposition 19?

To apply for the homeowners’ exemption or disabled veterans’ exemption, a claim must be filed with the County Assessor.

How is a property held in a trust affected by Proposition 19?

The administration of a trust is governed by the trust instrument itself. For properties held in trusts, Revenue and Taxation Code section 61(h) states that a change in ownership occurs when any interests in real property vest in persons other than the trustor or the trustor’s spouse or registered domestic partner when a revocable trust becomes irrevocable. This typically occurs upon the death of the trustor. The date of death is considered to be the date of change in ownership. Proposition 19 is clear that Proposition 58 applies to transfers that occur on or before February 15, 2021, and Proposition 19 applies to transfers that occur on or after February 16, 2021.

I have my deed signed and notarized, and have submitted it for recording at my local County Recorder's office prior to the February 15, 2021 deadline. What if my deed does not record by the February 15, 2021 deadline? Must my deed be recorded prior to that date in order to still be under the Proposition 58/193 provisions?

No. As long as the date of transfer is on or before February 15, 2021, the transfer will qualify for the Proposition 58/193 exclusion. Property Tax Rule 462.260 makes clear that the recordation date of a deed is rebuttably presumed to be the transfer date. This means that if evidence is shown that the transfer occurred prior to the recordation date, the assessor should accept that earlier date. Such evidence could be, for example, the date of a notarized document of transfer, such as a deed.

If a parent died prior to February 16, 2021, and the Assessor does not become aware of the death until a year later and reassesses the property as of the date of death, are the parent-child exclusion provisions applied under Proposition 58 or Proposition 19?

The law in effect is that the date of death will apply. Proposition 19 is clear that Proposition 58 applies to transfers that occur on or before February 15, 2021, and Proposition 19 applies to transfers that occur on or after February 16, 2021.

What are the Proposition 19 rules about the parent-child exclusion if the value of the family home is valued at greater than $1 million dollars?

The value limit under Proposition 19 is the sum of the factored base year value plus $1 million. If the market value exceeds this limit, partial relief is available. The amount exceeding the excluded amount will be added to the factored base year value.

If we didn’t submit our application for the parent/child exclusion before February 16, 2021, can we still qualify for the exclusion under Proposition 58/193?

As long as the date of transfer or change in ownership of real property between parent and child occurred on or before February 15, 2021, the transfer will qualify for the exclusion under Proposition 58/193 . The date of death is the date of the change in ownership. The claim must be filed with the County Assessor within three years of the date of transfer or before a transfer to a third party or within six months of the date of notice of supplemental or escape assessment. Therefore, the claim does not need to be filed by February 16, 2021.

FAQs Archive - Page 16 of 17

Who can borrow against a Trust, Estate or Probate property?
Trustees (with the power to encumber trust property), Administrators of estates (with Letters of Administration and Full/Limited Authority), Fiduciaries, and Conservators. Please note, restrictions do apply

Continue reading
Why would a Trust, Estate or Probate need to secure a loan?
Trustees, executors, administrators, private fiduciaries, and estate and trust attorneys routinely encounter problems when administering cash-poor trusts, estates or probates after someone passes away. These problems include how to equalize and distribute assets between children so that everyone gets an equal share; how to pay expenses when there is little or no cash in the

Continue reading
What is Proposition 58, the Parent-Child, and 193, the Grandparent-Grandchild Exclusion from Reassessment?
In the State of California, real property is reassessed at market value if sold or transferred, and property taxes can increase dramatically as a result. However, if the sale or transfer is between parents and their children, or from grandparents to their grandchildren, under specific/limited circumstances, the property will not be reassessed if certain conditions

Continue reading
I still have questions on Proposition 19. Who do I contact to discuss?
If you have further questions, you may call one of our experts at HCS Equity at 877-427-9820.

Continue reading
How do I apply for the homeowners’ exemption or disabled veterans’ exemption within one year of the transfer to qualify for the parent-child or grandparent-grandchild exclusion, as required by Proposition 19?
To apply for the homeowners’ exemption or disabled veterans’ exemption, a claim must be filed with the County Assessor.

Continue reading
How is a property held in a trust affected by Proposition 19?
The administration of a trust is governed by the trust instrument itself. For properties held in trusts, Revenue and Taxation Code section 61(h) states that a change in ownership occurs when any interests in real property vest in persons other than the trustor or the trustor’s spouse or registered domestic partner when a revocable trust

Continue reading
I have my deed signed and notarized, and have submitted it for recording at my local County Recorder’s office prior to the February 15, 2021 deadline. What if my deed does not record by the February 15, 2021 deadline? Must my deed be recorded prior to that date in order to still be under the Proposition 58/193 provisions?
No. As long as the date of transfer is on or before February 15, 2021, the transfer will qualify for the Proposition 58/193 exclusion. Property Tax Rule 462.260 makes clear that the recordation date of a deed is rebuttably presumed to be the transfer date. This means that if evidence is shown that the transfer

Continue reading
If a parent died prior to February 16, 2021, and the Assessor does not become aware of the death until a year later and reassesses the property as of the date of death, are the parent-child exclusion provisions applied under Proposition 58 or Proposition 19?
The law in effect is that the date of death will apply. Proposition 19 is clear that Proposition 58 applies to transfers that occur on or before February 15, 2021, and Proposition 19 applies to transfers that occur on or after February 16, 2021.

Continue reading
What are the Proposition 19 rules about the parent-child exclusion if the value of the family home is valued at greater than $1 million dollars?
The value limit under Proposition 19 is the sum of the factored base year value plus $1 million. If the market value exceeds this limit, partial relief is available. The amount exceeding the excluded amount will be added to the factored base year value.

Continue reading
If we didn’t submit our application for the parent/child exclusion before February 16, 2021, can we still qualify for the exclusion under Proposition 58/193?
As long as the date of transfer or change in ownership of real property between parent and child occurred on or before February 15, 2021, the transfer will qualify for the exclusion under Proposition 58/193. The date of death is the date of the change in ownership. The claim must be filed with the County

Continue reading

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