California Property Tax Exemptions: Homeowner and Senior Guide

California Property Tax Exemptions: Homeowner and Senior Guide

California's Proposition 13 keeps the base property tax rate at 1% of assessed value, which is already lower than most states. But there are still exemptions available that can reduce your bill further. Some are small (the $7,000 homeowner's exemption), and some are substantial (the disabled veteran exemption). Here's every option.

Homeowner's Exemption

If you own and occupy your home as your principal residence, you qualify for a $7,000 reduction in assessed value. At a 1% base tax rate, that saves approximately $70 per year. It's modest, but it's free and takes five minutes to file.

How to Apply

• File Form BOE-266 with your county assessor
• You must own and occupy the home as of January 1
• Only one homeowner's exemption per person
• File once; it auto-renews unless you move

Many California homeowners never file for this. Check your tax bill to see if the exemption is listed. If not, apply today.

Disabled Veteran's Exemption

This is the most valuable property tax exemption in California. Two levels are available:

Level	Assessed Value Exemption (2026)	Who Qualifies
Basic	$161,083	Veterans rated totally disabled by the VA, or with specific service-connected disabilities
Low-Income	$241,627	Same disability requirements plus household income under the annual limit

These amounts are adjusted annually for inflation. The exemption replaces the homeowner's exemption (you can't claim both). On a home assessed at $500,000, the basic exemption saves approximately $1,610 per year.

How to Apply

• File Form BOE-261 with your county assessor
• Provide your VA disability documentation
• Must be filed annually by February 15 for the basic exemption, or June 30 for late filing

Veteran's Exemption (Basic)

Any veteran with qualifying wartime service can claim a $4,000 reduction in assessed value, saving about $40 per year. This is separate from the disabled veteran's exemption. You cannot claim both. If you qualify for the disabled veteran exemption, take that one instead.

Proposition 19 Transfer Benefits

For Seniors (55+), Disabled, and Disaster Victims

Proposition 19 allows you to transfer your current Prop 13 tax base to a replacement home anywhere in California. Key rules:

• Must be age 55 or older, severely disabled, or a victim of wildfire/natural disaster
• Available up to three times in your lifetime
• Replacement home can be of equal or lesser value with a full transfer; if the replacement is more expensive, the difference is added to your base year value
• Must buy or build within two years of selling

This is enormously valuable for seniors who have lived in their home for decades and built up a large gap between their assessed value and market value. Without the transfer, buying a new home would reset the assessed value to the purchase price.

Parent-Child and Grandparent-Grandchild Transfers

Prop 19 also covers inherited property. If you inherit a home from a parent or grandparent and use it as your primary residence, you can keep the inherited Prop 13 base year value with an adjustment of up to $1 million above that value. If you don't use it as your primary residence, the property gets fully reassessed.

Property Tax Postponement Program

California's State Controller's Office runs a property tax postponement program for qualifying homeowners. The state pays your property taxes, and you repay with interest when the home is sold or transferred.

Eligibility

• Age 62 or older, or blind, or disabled
• Annual household income of $49,017 or less (2026, adjusted annually)
• At least 40% equity in the home
• Property taxes must be current (not delinquent)

The interest rate is set by the state and has historically been around 5-7%. This is useful for asset-rich, cash-poor seniors who want to stay in their home but struggle with the tax payments.

Other California Exemptions

Exemption	Details
Church/Welfare Exemption	Property owned by churches, hospitals, and qualifying nonprofits
Solar Energy System Exclusion	Active solar energy systems are excluded from new construction reassessment through 2027 (extended by AB 1637)
Disaster Relief (Section 69.3)	Homeowners who rebuild after a disaster can transfer their pre-disaster base year value
Williamson Act (Agricultural)	Agricultural land under a Williamson Act contract is assessed at agricultural use value
Historic Property (Mills Act)	Properties with Mills Act contracts receive reduced assessments (typically 40-60% lower)

Mills Act Contracts

The Mills Act is one of the most powerful tax reduction tools in California, but it's only available for properties designated as historic landmarks. If your home is on a local, state, or national historic register, you may qualify for a Mills Act contract with your city. These contracts reduce the assessed value using an income-based approach, often resulting in a 40-60% tax reduction.

Mills Act contracts run for 10 years and automatically renew. In exchange, you agree to maintain and preserve the historic character of the property.

How to Check Your Current Exemptions

1. Look at your annual property tax bill
2. Find the "Exemptions" line item
3. If it shows $0 or is missing, you likely haven't filed for the homeowner's exemption
4. Visit your county assessor's website and search for your property
5. Compare what's listed with what you qualify for

Frequently Asked Questions

Does the homeowner's exemption transfer when I move?

No. You must file a new homeowner's exemption with the assessor in your new county. The old one is automatically canceled when you sell.

Can I get the veteran's exemption and the homeowner's exemption?

No. You can claim one or the other. The disabled veteran's exemption is always more valuable than the homeowner's exemption, so choose that if you qualify.

What's the difference between Prop 60/90 and Prop 19?

Propositions 60 and 90 (now superseded by Prop 19) allowed seniors to transfer their base year value to a replacement home, but only within the same county (Prop 60) or to a county that accepted inter-county transfers (Prop 90). Prop 19 expanded this to any county in California and increased the number of transfers to three.

Is there a senior property tax exemption in California?

California does not have a general senior property tax exemption like some states. However, seniors benefit from the Prop 19 transfer provisions, the property tax postponement program, and the Prop 8 decline-in-value appeal process. For strategies beyond exemptions, see our guide to lowering California property taxes.