Subject: Estate Planning for the State
SJR-20 Resolution 57
Gas taxes, local taxes, auto fees, sales tax revenue, tolls for bridge traffic and lastly property taxes aren’t cutting it. Hopefully, the economy will turn upward and billions in new revenue will enter the system. Unfortunately, the interaction between property taxes and capital gains taxes in California are unique because of Prop 13 and won’t increase much even though the economy may start an upward trend. Property taxes are the primary source of income for schools and local governments – close to 72%.
What to do about it?
Seniors have had enough tax breaks over the last 40 years, which is true. Fortunately, the problem is the solution to creating billions in property tax revenue early. Allow those very seniors to sell without paying capital gains, or possibly double the exemptions. Remember, there is the escape tax legislation called the ‘Step-Up-Basis-at-First-Death’ that avoids capital gains completely for the survivor. Read the rest of this entry »