Eliminating California’s inheritance tax break for vacation houses and rental property and restricting its use for primary homes could raise $2 billion a year in property taxes over time, according to a new analysis.
The tax break was subject of a recent Times investigation that found wealthy heirs across the state had received large tax benefits from inherited property and that the majority of heirs had not reported their homes as their primary residence.
For instance, actor Jeff Bridges and his siblings would have paid an additional $300,000 in property taxes if their Malibu beach property had been reassessed when they inherited it nine years ago. Earlier this year, the family listed the home for rent at $15,995 a month.
The report from the state’s nonpartisan Legislative Analyst’s Office studied the effects of requiring heirs to live in their parents’ home to receive the tax break and limiting the benefit to the first $1 million in taxable value for primary residences. The analyst estimated these changes would increase property taxes for 40,000 to 60,000 inherited properties each year.
Read the full story on LATimes.com.
