Ways to Save on your Taxes

Replacement Residence Exclusion (Propositions 60, 90 and 110)

Propositions 60, 90 and 110 are voter-approved amendments (Revenue and Taxation Code, Paragraph 69.5) which allow qualifying Sonoma County homeowners to transfer the taxable value of a previous residence to a new residence. For many people, this can result in substantial tax savings. The general eligibility requirements are as follows:

• You (or your spouse who resides with you) must either be at least 55 years of age (Prop 60) or severely and permanently disabled (Prop 110) as of the date you sell the home you are replacing.
• The sale of your original residence must occur within two years of the purchase or construction of your replacement residence (either before or after). Your original residence must be your principle dwelling within two years of purchasing or constructing your new home. You must occupy your new home as your principal place of residence at the time you file your claim.
• Both of your properties must be located in Sonoma County unless the county where the replacement residence is located has an ordinance that allows intercounty transfers of base year value (Prop 90). Visit the California Board of Equalization's web site for a current list of participating counties.
• The transfer of your original residence must have been subject to reappraisal at fair market value. Transfers excluded from reappraisal (e.g., most transfers between parents and children) will not qualify for this exclusion.
• The replacement property must be of equal or lesser market value than the home you are replacing. "Equal or lesser market value" generally means the fair market value of the replacement property does not exceed one of the following:
  • 100% of the market value of the home you are replacing if you purchase or construct the replacement residence prior to selling the home you are replacing, or
  • 105% of the market value of the original residence if you purchase or construct the replacement residence within one year of selling the home you are replacing, or
  • 110% of the market value of the original residence if you purchase or construct the replacement residence within the second year after selling the home you are replacing.
• You can only take advantage of the tax relief benefit for persons 55 and older (Prop 60) once. Proposition 110 creates an exception from this one-time-only limitation for any claimant who becomes severely and permanently disabled after having previously taken advantage of the benefit as a claimant over the age of 55.
• In order to receive the full benefit, claims must be filed within three years of the date the replacement residence was purchased or completed. If your claim is filed after the three-year period, relief will be granted beginning with the calendar year in which you file your claim. Do not apply before the sale of the home you are replacing and the purchase of your new home are both recorded with the Sonoma County Recorder.
• If your claim is due to a disability, your move to the replacement residence must be necessitated by the disability or to alleviate financial burdens caused by the disability. If your claim is due to a disability, you must complete and include a Physician's Certification of Disability with your claim.

• Prop 60: Claim for Transfer of Base Year Value to Replacement Dwelling (age 55 or older)
• Prop 110: Claim for Transfer of Base Year Value to Replacement Dwelling (disabled person)

The guidelines on this page are general guidelines only. You can read additional information about this and other provisions on the California State Board of Equalization site. For more information, or for assistance completing and submitting a claim form, please visit our offices, write us, or contact us by telephone or email.