January 3, 2006 > New law extends property tax benefits to domestic partners
New law extends property tax benefits to domestic partners
by David Ginsborg
Santa Clara County Assessor Larry Stone announced an aggressive effort to educate Domestic Partners of a new law extending some property tax benefits to registered Domestic Partners. The Assessor's office mailed letters to the over 2000 Domestic Partners in the county and the Assessor's website was updated to feature a special informational section about the new law.
Effective, Jan. 1, 2006, registered Domestic Partners will be afforded many of the same property tax benefits available to married couples. The new benefits are the result of legislation, Senate Bill 565, introduced by Senator Carole Migden and signed into law by Governor Arnold Schwarzenegger.
The new law allows a Domestic Partner, who is registered with the Secretary of State, to be excluded from reassessment when one partner is added or removed from property title, whether by deed or by death, provided that the property interest is conveyed to the registered Domestic Partner remaining on title. Transfers prior to the Jan. 1, 2006, effective date are not covered by this law.
Domestic partnership is a recognized method for two individuals, often senior citizens, to enjoy many of the same rights, responsibilities and privileges afforded married couples.
"Excluding registered Domestic Partners from property tax benefits available to married couples was unfair and I am pleased the legislature has finally corrected this deficiency. Domestic partners should not be taxed from their homes when one partner dies. That was a core principal of Proposition 13, and more than 25 years later SB 565 corrects that problem," said Stone.
Beginning with the deeds recorded Jan. 3, 2006, the Assessor's office will identify transfers between registered Domestic Partners by reviewing the Preliminary Change in Ownership Report (PCOR) that is typically filed with the Recorder's office at the same time a deed is recorded. The PCOR is not a public document; it is merely collected by the Recorder and forwarded to the Assessor together with an electronic copy of the deed.
The PCOR is reviewed by the Assessor to determine whether or not the property transfer requires reappraisal to current market value for assessment purposes. Domestic Partners are urged to fully complete the PCOR. To the extent that the Assessor can identify that the transfer was between registered Domestic Partners, it will be excluded from reassessment.
If an interest in a mobile home is being conveyed between domestic partners, the Assessor encourages the owners to call or email the Assessor's mobile home unit to receive a PCOR to assist in determination of the reassessment status of the property transfer.
As with all new laws, it is subject to legal interpretations and court challenges. Therefore, Domestic Partners contemplating transferring real property or a mobile home are urged to contact their attorney and/or accountant, prior to the transfer. Transferring an ownership interest may have unintended and potentially unwelcome financial and legal consequences.
The advice contained above is not intended to substitute for comprehensive financial or legal advice. Rather it is to inform registered Domestic Partners of this important change in the law.
For more additional information, go to the Assessor's website at www.scc-assessor.org.