Most people facing an inherited house are doing this in the middle of grief, often as an adult child or surviving spouse, and often with brothers, sisters or other relatives waiting to hear what happens next. The paperwork is unfamiliar, the house still has bills, and nobody explained the order of things. This guide walks through that order, from how the house changes hands to the tax questions and the choices that follow.
The First Things to Understand About an Inherited House in California
How the house was titled shapes every step that follows. The deed and any trust document show whether the person who died, called the decedent, owned it alone, with a spouse as community property, in joint tenancy, as a tenant in common with others, or through a trust. Under Civil Code section 683, a joint tenancy is ownership in equal shares that was expressly declared to be a joint tenancy, and the California Courts' self-help guide explains that when one joint tenant dies, the property passes to the other. In plain terms, if the deed says "joint tenants," the surviving owner usually already holds the house, and the remaining work is mostly paperwork.
This guide covers real property, meaning the land and the house. Furniture, cars, jewelry and bank accounts are personal property and follow their own steps.
Two words come up often. An heir is a person who inherits under California's rules for someone who left no will. A beneficiary is a person named in a will or trust to receive property.
How the House Transfers: Trust, Probate, or a Simplified Procedure
Probate Code section 7000 provides that title to a decedent's property passes at death to the person it is left to in the will or, without a will, to the heirs under California's intestate succession rules, the rules for who inherits when there is no will. Probate Code section 7001 adds that the property is generally subject to administration and to the rights of creditors and others. Put simply, the house belongs to the heirs or beneficiaries from the moment of death, but the estate's debts and the legal process still have to be dealt with before it is fully theirs to hold, rent or sell.
Trust administration. A trustee holds and manages property under a trust. A successor trustee is the person named to take over when the original trustee dies. That person follows the instructions written in the trust, and a trust transfer typically does not need a court filing; a deed is recorded after the death.
Probate. This is the court-supervised process in the county Superior Court. An executor is the person named in the will to manage the estate. An administrator is the person the court appoints when there is no will or no executor can serve. "Personal representative" covers either role. Probate is described in more detail near the end of this guide.
Simplified procedures. Probate Code section 13151 lets a successor ask the court, after 40 days, for an order transferring the decedent's primary residence in California if its gross value is within a statutory limit. Probate Code section 13200 allows an affidavit for real property of small value, no sooner than six months after death, with an appraisal by a probate referee attached. These limits are adjusted periodically, and the California Courts publish the current figures by date of death. A recorded transfer on death deed is another path that can pass the house; Probate Code section 5600 governs those deeds.
Getting the House Into Your Name: Recording a New Deed
Recording is the last title step, not the first. Once the trust, probate or simplified process has done its work, a document is recorded with the county recorder in the county where the house sits, and that record becomes the public proof of who owns it. Common documents include:
- Trustee's deed: signed by the successor trustee to move the house from the trust to a beneficiary.
- Court order: in probate or a primary-residence petition, the court's order showing who receives the house.
- Affidavit of death of joint tenant: used when a surviving joint tenant takes the house by survivorship. Under Civil Code section 682.1, community property with right of survivorship passes to the surviving spouse without administration, following the same procedures as joint tenancy.
- Spousal property petition order: a court order confirming property passes to a surviving spouse.
An attorney or a title company typically prepares these documents. The California Courts' self-help guide notes that deeds are public records, available at the County Recorder's Office in the county where the property is located.
Property Taxes After Inheritance: Proposition 19 and Reassessment
Rev. & Tax. Code section 60 defines a "change in ownership" as a transfer of a present interest in real property whose value is substantially equal to full ownership. The State Board of Equalization explains that property taxes are based on value at acquisition, so a market value above the old assessed value raises the tax. For a family that has owned a home for decades, that gap can be large, which is why the filings below matter.
The ownership filing. Rev. & Tax. Code section 480 requires a change in ownership statement. Where a death transfers real property outside probate, including through a trust, the trustee or the new owner files it with the county recorder or assessor within 150 days after the date of death. In probate, the personal representative files it before or when the inventory and appraisal is filed with the court.
The Proposition 19 exclusion. Proposition 19, under Rev. & Tax. Code section 63.2, excludes some parent-to-child transfers on and after February 16, 2021, when a claim is filed. The BOE's Proposition 19 fact sheet states the home must have been the parent's principal residence and must become the child's within one year, with the homeowners' or disabled veterans' exemption filed within one year. A rental home does not qualify, according to the BOE's Proposition 19 page.
The exclusion has a value limit. Value above the parent's taxable value plus an adjusted amount is added; the BOE publishes the current figure. Using the fact sheet's adjusted amount of $1,044,586 for transfers from February 16, 2025, through February 15, 2027, the mechanics work like this: if a parent's taxable value was $300,000, the limit is $1,344,586. If the home's market value at the parent's death is $1,200,000, it falls under the limit and the child keeps the $300,000 taxable value. If the market value is $1,500,000, the $155,414 difference is added, so the new taxable value becomes $455,414.
The claim. The claim is form BOE-19-P, filed with the county assessor within three years of the transfer date but before a transfer to a third party, or within six months after a supplemental or escape assessment notice is mailed. A later claim can still apply, from the year filed. Grandchildren qualify only if the parents who are the grandparents' children have died. Transfers between spouses, including on death, are excluded separately. The county assessor's office handles the claim itself.
Federal Income Tax and the Step-Up in Basis
Basis is the starting value used to figure gain or loss when property is sold. Under 26 U.S.C. § 1014(a), the basis of property acquired from a decedent is generally its fair market value on the date of death, with alternatives where an alternate valuation election or certain other provisions apply. This is often called the step-up in basis.
In practice, an heir who sells at or near the date-of-death value typically has little or no gain to measure, because the sale price and the basis are close. The IRS explains that selling for more than basis produces a taxable gain.
Some cases differ. IRS Publication 551 notes a different rule for appreciated property the heir or the heir's spouse gave the decedent within one year before death. Community property held by spouses has its own basis treatment, which is a distinct question. A CPA, an enrolled agent or a tax attorney reviews the basis calculation and the tax effect of any sale.
No State Inheritance Tax in California
California does not impose a state inheritance tax or a state estate tax on a death today. The State Controller's California Estate Tax page states that no California estate tax return is required for a person who dies on or after January 1, 2005, and that the office continues to collect the inheritance tax for people who died before June 8, 1982. Inheriting the house does not, by itself, create a California tax bill on the heir for receiving it, and IRS Publication 559 states that property received by inheritance is not included in income, though rent or other income it later produces is.
The federal estate tax is a separate question governed by federal law, and whether a particular estate owes it depends on facts this guide does not address. Property-tax reassessment, covered above, is also separate: it concerns the yearly county tax bill, not a tax on inheriting.
Options for the Inherited Property
Heirs who now own a house together are often weighing practical, money and family concerns at once. Three choices are most common.
Moving in. Living in the home as a primary residence is what may qualify a child for the Proposition 19 exclusion described above. It also brings decisions about insurance, upkeep and any mortgage. On the mortgage, a federal law often called the Garn-St. Germain Act, at 12 U.S.C. § 1701j-3(d), generally keeps a lender from calling the loan due just because the house passed to family. For a loan on residential property with fewer than five units, a lender may not use a due-on-sale clause upon certain transfers, including a transfer to a relative resulting from the borrower's death and a transfer where the borrower's spouse or children become owners. Heirs commonly contact the loan servicer, and a housing counselor can explain options.
Renting. A rental brings income and landlord duties under California law, and it does not qualify for the parent-child exclusion, so the property is generally reassessed.
Selling. A sale raises the basis question above. Listing with a licensed real estate agent may reach more buyers but involves preparation, showings and buyer financing. A cash sale can reduce repairs, showings, financing uncertainty and time, though how well it fits varies from family to family. Selling an inherited home is covered in more depth in its own guides.
When several heirs own the house together, the co-owners decide together. If they cannot agree, that contested matter is handled by an attorney who litigates trust and probate cases.
When the Estate Goes Through Probate: What to Expect
The executor named in the will, or an administrator the court appoints when there is none, generally petitions the Superior Court in the county where the decedent lived at death. That person gathers assets, pays debts and later distributes property under court supervision. Publication 559 summarizes these duties as collecting assets, paying creditors and distributing what remains to heirs or beneficiaries. Because creditors are paid before distribution, what heirs ultimately receive depends on what is left once the estate's debts are handled.
A house in probate generally cannot be sold without court authorization or court confirmation of the sale, unless the personal representative has authority under the Independent Administration of Estates Act, a law that lets the court allow some actions with notice to heirs and beneficiaries instead of a separate hearing.
Probate can take many months, sometimes more than a year, depending on the estate and the court's calendar. It is a public proceeding, so a will filed there becomes a public record. The California Courts' guide explains how to check whether a simpler process fits first. A probate attorney typically guides the executor or administrator.
