California's Proposition 13, passed in 1978, fundamentally changed property taxation in the state — and remains one of the most significant property tax laws in American history. Understanding Prop 13 is essential for every California property owner.
How Prop 13 Works
Under Prop 13, your property's assessed value is set at the purchase price (the 'base year value') and can only increase by a maximum of 2% per year — regardless of how much the market value increases. When a property is sold, the assessed value resets to the new purchase price.
Example: A home purchased in 1995 for $200,000 might have a 2025 assessed value of only $320,000 (after 30 years of 2% increases), even if the market value is $1.5 million. The owner pays taxes on $320,000, not $1.5 million.
When Can You Appeal in California?
Because Prop 13 limits increases to 2% per year, most California homeowners who have owned their property for several years are not over-assessed. However, you can appeal if: (1) the market value has fallen below your assessed value (a 'Prop 8' reduction), (2) there was a change in ownership that triggered a reassessment at an incorrect value, or (3) there was a new construction assessment you believe is too high.
Prop 8 — Temporary Reductions
Under Prop 8, if the market value of your property falls below the Prop 13 base year value (or the current assessed value), you can request a temporary reduction to market value. This was widely used during the 2008–2012 housing downturn. When the market recovers, the county can increase the assessed value back to the Prop 13 value.
Prop 19 — Parent-Child Transfers
Prop 19 (passed in 2020) significantly changed the rules for parent-child property transfers. Under Prop 19, children who inherit a parent's home can keep the parent's Prop 13 base year value only if they use the home as their primary residence. If the home's market value exceeds the parent's taxable value by more than an inflation-indexed exclusion amount ($1,044,586 for transfers from February 16, 2025 through February 15, 2027), the exclusion is not lost entirely — instead, the assessed value is partially adjusted upward: the new taxable value is the market value minus the exclusion amount.
The Assessment Appeals Board Process
File an Assessment Appeal Application (BOE-305-AH) with your county Assessment Appeals Board between July 2 and November 30 in most counties (10 counties — including San Francisco, Santa Clara, and Alameda — close on September 15). The filing fee is typically $30–$75. Hearings are scheduled within 2 years of filing (1 year for residential properties).