Can I transfer my parents' tax basis when I inherit their home?

Under current California law (post-Prop 19), the parent-child tax basis transfer has two conditions:

1. You must make the inherited home your primary residence within one year of the inheritance date. "Primary residence" means actually living there — not just a vacation use, not as a rental, and not maintaining your primary elsewhere.

2. Only the first $1 million of the assessed-to-market difference is excluded from reassessment. Above that $1M, the property is reassessed.

Example: parents bought the home in 1995 for $300K, paid down the assessment to $350K under Prop 13. Current market value: $1.5M. The difference: $1.15M. If you move in within a year, the first $1M is protected; the additional $150K above triggers a reassessment proportional to the excess.

For an East Bay home worth $1.5M, this typically means annual property taxes jump from $4,000-$5,000 (parent's basis) to $12,000-$18,000 (reassessed market).

If you don't move in within a year, the property is fully reassessed to market value — often quadrupling the annual tax bill.

The decision math for inheritors: live in it, sell it, or accept the higher tax. Many families sell because the math of holding doesn't work after reassessment.

Need a complete answer for your specific situation? Call (510) 504-0402, text (406) 205-9003, or email roger@grubb.net. No charge, no pitch — just a real conversation about what you're navigating.