Today TaxMama hears from Gerald in Kansas, who tells us. “I have talked to my mother-in-law and my wife about your advice on selling the house. We like the idea of refinancing the house rather than selling it and paying taxes the very large gain. And this will still leave my mother-in-law with a stream of rental income.
She did have one question that I could not answer and hope you could help me again. She bought the house with her late husband back in the early 60’s for $24,000, she has paid the same property taxes since then because of California’s Proposition 13 that tied property taxes to the last purchase price of the home.
Her question is, will the taxes now go up because of the refinancing or because of Prop. 13 will they continue to stay the same?
She is nervous about making this move, but I continue to encourage her to go forward and enjoy some of the things she wants to do with the money that will come to her when she refinances the house.”
Hi Gerald
I am not sure why she’s concerned about that? Refinancing a house won’t cause property taxes to rise.
Aahhh….got it. Your mother is wondering if the new, current appraisal will bring the increase in value to the attention of the tax assessor. No. Not a problem.
The property taxes will remain the same. The appraisal and refinance won’t affect it – only major remodeling or improvements, that require a permit.
And remember, you’ll find answers to questions about tax planning options and all kinds of tax issues, free. Where? Where else? At TaxMama.com
To make your comments, please visit TaxMama’s Parlor at TaxTwist.com.
- taxmama :: Where taxes are fun and answers are free
- TaxTwist.com :: Where TaxQuips will be moving & You can add your comments
File Download (1:47 min / 0.4 MB)
