How does Proposition 19 affect inherited property in California?

It basically got rid of Prop 58. Prop 58 allowed for primary residences to be transferred between parents and children, without causing a property tax reassessment. Prop 58 also allowed for transfers up to $1 million (of assessecdv value) of non-primary residences (e.g., rentals, vacation homes, investment properties) between parents and children, without causing property tax reassessments.

Under Prop. 19, which took effect February 2021, these rules are no longer valid. Instead, property taxes will go up when the parents die or when property is transferred during the parent’s lifetime. The only limited exception is for the primary residence of the parent. Under that exception, if a child moves into the parent’s primary residence within one year of the date of death and fills out all the necessary forms within the time period, then the property tax will only go up if the fair market value of the property on the date of death exceeds the assessed value by over $1 million (subject to minor inflation).