Copyright 2002, Marc S. Weissman
Certified Specialist: Estate Planning, Trust and Probate Law
Certified by the California Board of Legal Specialization of The State Bar of California
Weiss & Weissman, Foster City, California
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San Francisco Tax Assessor declares
same-sex registered domestic partners are equivalent to spouses!
This is vitally important to lesbian and gay San Francisco property owners.
Let's assume that Harry and Wanda (a married couple) buy a home; the same day Gary and Greg (registered domestic partners) bought the house next door for the same price. They pay the same property taxes for years.
[Property taxes are roughly 1.1% of the assessed value. The assessed value starts with the purchase price and can climb only 2% a year, even if the market increases 15% a year. This Proposition 13 protection applies until there is a change in ownership.]
Many years later, Harry dies; Wanda gets Harry's half. The same day Gary dies; Greg gets Gary's half.
Until then the property taxes were the same. What happens with the change in ownership caused by the deaths?
- When Wanda inherits Harry's share of the house, as a spouse her property taxes remain the same. Spousal transfers are EXEMPT changes in ownership which do not cause a property tax re- assessment.
- But when Greg inherits Gary's share of the house, until recently, there would be a re-assessment of Gary's half to today's market value.
Another way this comes up is if Gary and Harry had purchased their adjacent homes years before. Later they meet their true loves and form lifetime unions.
- Harry easily can add Wanda to ownership under the spousal exemption, and when he dies and Wanda inherits, she continues the old tax rate.
- Gary must plan carefully to avoid property tax re- assessment if he puts Greg on title, and when Gary dies, Greg gets fully re-assessed.
On October 10, 2002 San Francisco County declared that same-sex registered domestic partners are entitled to equal protection as sposes under the California Constitution so San Francisco County will allow these transfers without re-assessment. THE REST OF THE STATE RECOGNIZES NO SUCH EXEMPTION, but for now these transfers are safe in San Francisco.
If you want a copy of the full text of this Ruling, the SF County Assessor has it posted: look for Ruling 2002-01