How to Avoid Property Tax Reassessment in California
California reassesses a property to current market value on a change of ownership or new construction — and when that happens on a genuine sale, there is no trick to avoid it. But California law specifically excludes a long list of transfers from counting as a change of ownership. If your situation fits one of those exclusions, the property keeps its low Proposition 13 base and is not reassessed.
This page is a practical map of the legitimate exclusions — the ones the law actually provides — with a link to the governing statute for each. It is not a scheme to dodge tax on a real sale; it's how to keep your base when the law already says you should.
For the full legal detail behind each exclusion below, see the California reassessment law guide.
First, the honest part
A true sale to an unrelated buyer is a change of ownership, and it will be reassessed to the purchase price — there is no legitimate way around that. Building something new (an addition, an ADU, a major remodel) adds the value of that new construction to your assessment. What follows are not loopholes; they are the specific transfers California has decided should not reset your tax base.
The test in one line
Reassessment turns on whether beneficial ownership really changed. Move property between yourself and a spouse, your own trust, or an entity you own in the same shares, and ownership hasn't truly changed — so the law excludes it.
The transfers California excludes
Each of these keeps your Proposition 13 base if you qualify. Follow the link on any item for the governing statute, worked examples, and the fine print.
Adding, removing, or transferring to a spouse
Transfers between spouses (and registered domestic partners) are fully excluded — adding a spouse to title, transferring the whole home to one spouse, and transfers on divorce or death. There is no value cap.
Read the law & examples →Parent-to-child (and grandparent-to-grandchild) transfers
Since Proposition 19 (Feb 16, 2021) this is narrower: the child must make the home their own primary residence, and only the first ~$1 million of value over the assessed value is protected. It is still one of the biggest exclusions — but no longer the blanket rule it once was.
Read the law & examples →Funding a revocable living trust
Moving your home into your own revocable living trust, where you remain the present beneficiary, is not a change of ownership. It becomes relevant only later — when the trust turns irrevocable or the property passes to someone new.
Read the law & examples →Adding a co-owner (joint tenancy and cotenancy)
Joint tenancy and cotenancy have specific 'original transferor' and cotenant-to-cotenant rules that exclude many additions and the death of a co-owner from reassessment — though the details decide the outcome.
Read the law & examples →Transferring to your own LLC or corporation
Deeding property from yourself into an entity you own in the same proportions — for example, a home you own 100% into an LLC you own 100% — is excluded because your proportional ownership does not change. An entity is only reassessed later if more than 50% of its ownership changes hands.
Read the law & examples →Carrying your base to a new home at 55+ (Prop 19)
This one doesn't stop a reassessment so much as let you take your low base with you. Homeowners 55 or older, severely disabled, or disaster victims can transfer their base-year value to a replacement home anywhere in California, up to three times.
Read the law & examples →Things that don't trigger reassessment at all
Some events feel like they should reset your taxes but don't count as a change of ownership in the first place — so there is nothing to “avoid”:
- Refinancing your mortgage (ownership doesn't change).
- Moving a home between yourself and a wholly-owned LLC or living trust.
- Ordinary repairs and maintenance (a new roof, repainting, replacing systems like-for-like) — as opposed to new construction that adds value.
- Correcting or re-recording a deed without changing ownership.
Proposition 13 vs. Proposition 19, quickly
| Proposition 13 (1978) | Proposition 19 (2020) | |
|---|---|---|
| Core rule | Reassess only on change of ownership or new construction; +2%/yr cap | Kept Prop 13's core rule intact |
| Parent-child transfers | Broad exclusion (former Prop 58/193) | Primary residence only, with a value cap |
| Moving at 55+ / disabled / disaster | Limited (former Prop 60/90) | Carry your base statewide, up to three times |
Frequently Asked Questions
How can I avoid property tax reassessment in California?
You cannot avoid reassessment on a genuine, arm's-length sale — that is a change of ownership by definition. What you can do is use the exclusions the law already provides: transfers between spouses, qualifying parent-child transfers (now limited by Proposition 19), funding a revocable living trust, certain joint-tenancy and cotenancy transfers, and transfers to an entity you own in the same proportions. If your situation fits one of these, the property keeps its Proposition 13 base.
Does Proposition 13 or Proposition 19 control reassessment?
Both. Proposition 13 sets the rule that a property is reassessed to market value only on a change of ownership or new construction, and otherwise rises no more than 2% a year. Proposition 19 (2020) changed two of the exclusions: it narrowed the parent-child exclusion (primary residence only, with a value cap) and expanded the base-year transfer for homeowners 55+, disabled, and disaster victims.
Does adding my spouse to the deed trigger reassessment?
No. Interspousal transfers are fully excluded from change-of-ownership reassessment, including adding a spouse to title, transferring the home to one spouse, and transfers on divorce or death. There is no dollar cap.
Does transferring my house to an LLC trigger reassessment?
Not if your proportional ownership stays the same — for example, deeding a home you own 100% into an LLC you own 100%. That is an excluded transfer. The entity can be reassessed later, though, if more than 50% of its ownership interests change hands.
Can I avoid reassessment when I inherit my parents' house?
Sometimes. Under Proposition 19 the parent-child exclusion applies only if you make the home your own primary residence, and only the first roughly $1 million of value above the assessed value is protected. Inherited property kept as a rental or second home is reassessed to market value.
Does refinancing trigger a property tax reassessment?
No. Refinancing your mortgage is not a change of ownership and does not cause a reassessment, as long as ownership of the property itself does not change.
See exactly how each rule works
The full reassessment-law guide catalogs every trigger and exclusion, each with the governing California statute, a worked example, and the leading court cases.
Open the California reassessment law guide →Learn More
This article is general educational information about California property-tax reassessment, not legal or tax advice, and does not create an advisor relationship. Exclusions have specific requirements, filing forms, and deadlines; the county assessor makes the official determination. Consult a qualified California attorney or tax professional and your county assessor before acting.