If you own and live in a home in California, there's a one-page form that knocks $7,000 off your assessed value and saves you about $90 every year for as long as you own the property. Most agents won't mention it. Most title companies won't follow up to make sure you filed it. And about a third of new homeowners I meet are leaving that money on the table.
The form is BOE-266, also known as ASSR-515 in Los Angeles County. It's the Homeowners' Property Tax Exemption. Filing it takes about ten minutes, and once it's on file, the exemption auto-renews every year until you move or rent the place out.
Ninety bucks a year isn't life-changing. But there are two reasons to care about this form anyway. First, over thirty years of ownership it adds up to a few thousand dollars and a small handful of nice dinners. Second, and this is the part most homeowners haven't connected, the same BOE-266 form is now the lever that protects your kids from a massive property tax reassessment if they inherit your home under Proposition 19. That second piece is where this gets serious.
Here's everything you need to know.
What This Form Actually Does
The Homeowners' Property Tax Exemption reduces the assessed value of your home by $7,000. Property taxes in California run roughly 1% to 1.3% of assessed value once you factor in local bonds and assessments, which means a $7,000 reduction translates to about $90 per year in actual tax savings for most homeowners. The exact number depends on your municipality, school district, and any voter-approved bonds in your area.
It's not a refund. It's a reduction applied to your annual property tax bill. You'll see it on the November 1 tax statement from your county each year, listed as a line-item exemption.
The exemption is set at the state level under Article XIII A of the California Constitution and Section 218 of the Revenue and Taxation Code. The dollar amount has been $7,000 since 1974, which is part of why the savings feel modest. The legislature has not adjusted it for inflation in fifty years. Whether that ever changes is a separate conversation, but for now, $7,000 is the number.
Who Qualifies
Three requirements, and all three have to be true on the same property.
You must own the home, you must occupy it as your principal residence, and the property must be one you actually live in rather than rent out, leave vacant, or use as a vacation place.
The form is broad about what counts as a "home." A single-family house qualifies. A condominium qualifies. A unit in a co-op housing project qualifies. A mobile home or manufactured home on land you own qualifies. Even a houseboat qualifies if you live in it as your primary residence.
What does not qualify: rental properties, vacant homes, second homes, vacation properties, or any property held in a trust where you're not the beneficial occupant. If you own a duplex and live in one unit while renting out the other, only the unit you live in gets the exemption. If you own multiple homes, you only get the exemption on the one that's your principal residence.
To determine whether a home is your principal residence, the assessor looks at where you're registered to vote, the address on your driver's license and vehicle registration, and where you spend the majority of your time. If you split time between two homes, you pick one.
The Two Ways to Claim It
The form covers two filing scenarios, called Alternative 1 and Alternative 2, on the back.
Alternative 1 is the standard path. You owned and occupied the home as your principal residence as of January 1 of the tax year. File the BOE-266 with your county assessor, and the exemption applies to that year's tax roll.
Alternative 2 is for new owners. You bought a home or completed new construction mid-year, and you're now subject to a supplemental assessment because the property's value reset. As long as you move in within 90 days of the purchase or completion of construction, and the property isn't already getting an equal or greater exemption, you can claim the exemption against the supplemental assessment.
This second path is where most new buyers in Lake Balboa, Van Nuys, Sherman Oaks, Encino, and Northridge miss out. The supplemental tax bill arrives a few months after closing. Most people pay it without realizing they could have shaved a partial-year exemption off it by filing the BOE-266 within 30 days of receiving the supplemental assessment notice.
If you closed escrow in the last few months and are reading this, check your supplemental assessment notice and note the date. You may still be inside the filing window.
Filing Deadlines That Actually Matter
For Alternative 1 (your standard annual exemption):
- File by February 15 at 5:00 PM for the full $7,000 exemption for that tax year.
- File between February 16 and December 10 at 5:00 PM, and you get 80% of the exemption ($5,600 reduction, about $72 in savings).
- File after December 10, and you get nothing for that year. You'd file for the following tax year instead.
For Alternative 2 (supplemental assessment after a purchase or new construction):
- File within 30 days of the Notice of Supplemental Assessment for the full exemption against the supplemental.
- File after 30 days but before the first installment of the supplemental tax bill becomes delinquent, and you get 80%.
- File later than that, and no exemption applies to the supplemental, though you're still on the regular roll going forward.
The 80% rule is one of those quiet California details that catches people off guard. Don't be a December filer if you can avoid it.
How to File in 2026
This is where things have actually gotten easier in the last few years.
If your property is in Los Angeles County, the assessor accepts e-filing through assessor.lacounty.gov. You upload the form or fill it in directly through their portal, attach any supporting documentation, and you're done. The portal sends you a confirmation, and the exemption posts to your property record within a few weeks.
If you prefer paper, the LA County mailing address is on the form: County of Los Angeles Office of the Assessor, 500 West Temple Street, Room 227, Los Angeles, CA 90012-2770. The form is bilingual (English and Spanish on alternating pages), and Spanish-language assistance is available at 213-974-3211.
For other counties: Ventura, Riverside, San Bernardino, Orange, San Diego, and most other large California counties also offer e-filing portals on their assessor sites. Search "[county name] assessor homeowners exemption" and you'll land on the right page.
You'll need your property's assessor identification number (APN), which is on your tax bill or your closing documents. You'll also need to provide your Social Security Number on the form. This is required by Revenue and Taxation Code Section 218.5 and Title 18 of the California Code of Regulations Section 135. The SSN isn't subject to public inspection, but it's a hard requirement for filing.
The Prop 19 Connection (This Is the Bigger Story)
This is where the BOE-266 stops being a small tax tip and becomes a serious estate planning tool.
When California voters passed Proposition 19 in November 2020, the rules for inherited family homes changed dramatically. Before Prop 19, parents could pass their primary residence to children without a property tax reassessment. After Prop 19, that benefit only applies if all three of the following happen:
- The child moves into the inherited home and makes it their principal residence within one year of the transfer.
- The child files BOE-266 within that same one-year window.
- The fair market value of the home doesn't exceed the parent's existing tax base by more than $1,044,586 (the BOE adjusts this cap every two years; the current figure applies to transfers between February 16, 2025, and February 15, 2027).
Miss any of those, and the home gets reassessed at fair market value. I have seen Lake Balboa families inherit a home with a $1,300 annual tax bill and watch it jump to $18,000 a year because the kids didn't move in within twelve months and didn't file the form.
The BOE-266 is the document that proves residency for Prop 19 purposes. Filing it on time is what makes the parent-child exclusion stick. If you have aging parents who own a home in California and you might one day inherit it, this form is no longer a small tax detail. It's the document that protects generational wealth.
If you're navigating an inherited California home right now, the property-tax exemption is only one piece of the picture. The bigger tax rule that general tax preparers routinely miss is the step-up in basis — the federal provision that resets the cost basis of inherited property to its fair market value at the date of death. I've written a full breakdown of how step-up basis works (and how it almost cost one of my Lake Balboa clients six figures) in a separate post here. If you've inherited or are about to inherit a California home, read both posts together.
The 25% Penalty Most Homeowners Don't Know About
Once the exemption is in place, it stays on file until something changes. If you sell the home, that's automatic — the new owner files their own BOE-266. If you turn the home into a rental, move out, or change your principal residence, you're legally required to notify the assessor.
Section 531.6 of the Revenue and Taxation Code adds a 25% penalty to the escape assessment if you fail to notify the assessor within a reasonable time. That's 25% of the back taxes owed for the period the exemption shouldn't have been applied.
Practical example: you bought a house in Northridge in 2020, filed your BOE-266, and the exemption has been auto-renewing every year. In 2024, you moved to Texas and started renting the Northridge property to a tenant, but you forgot to update the assessor. The exemption continues to apply to the property even though you no longer occupy it. Two years later, the assessor catches it during a routine audit. You owe back taxes for those two years on the wrongly claimed exemption, plus a 25% penalty on top.
The fix is simple: if your living situation changes, drop a line to your county assessor or update through their online portal.
A Word About the November 2026 Ballot
If you've been following California politics, you've heard about the "Fix Prop 19" effort, also known as "Repeal the Death Tax." Supporters are gathering signatures right now to put a measure on the November 2026 ballot that would roll back the inheritance restrictions in Prop 19 and restore the older Proposition 58 rules.
Two previous repeal attempts in 2022 and 2024 didn't gather enough signatures. Whether this one qualifies depends on hitting roughly 875,000 valid signatures by the May 2026 deadline.
Here's my honest read: don't plan around the possibility of a repeal. Plan around the law as it exists today. If the repeal qualifies and passes, that would be a great surprise for your family. If it doesn't, you don't want to find out you assumed it would and skipped the BOE-266 filing that protects your kids.
Common Mistakes I See in the Valley
A few patterns from the last twenty years of helping San Fernando Valley homeowners:
Forgetting after refinancing. The exemption stays in place after a refinance. You don't need to refile. But people sometimes assume they do, end up filing twice, and create paperwork confusion.
Assuming the title company filed it for you. Some do, some don't. After closing, log in to your county assessor's portal a month later and verify the exemption is on your property record. If it's not, file the form yourself.
Filing the wrong form for inherited property. If you're inheriting a home from a parent under Prop 19, you need both the BOE-266 (Homeowners' Exemption claim) AND the BOE-19-P (Claim for Reassessment Exclusion for Transfer Between Parent and Child). One protects the assessment exclusion; the other establishes residency. Both have one-year deadlines from the transfer date.
Letting it sit in a stack of mail. The BOE-266 sometimes arrives pre-printed with your information already filled in after a property transfer. People put it on the kitchen counter and forget about it. Then February 15 passes, and they're stuck with the 80% reduction or, worse, the December 10 cliff.
Renting out a room and not updating. If you rent out a portion of your home (Airbnb, long-term tenant in a converted garage, ADU rental), the exemption still applies as long as the home remains your principal residence. But if you rent out the whole property and move out, the exemption no longer applies, and you need to notify the assessor.
File It This Week If You Haven't
If you're a California homeowner and you've never filed the Homeowners' Property Tax Exemption, do it this week. It's a free five-minute task. If you closed on a home in the last few months, check your closing package — the form may have already come through escrow, or you may need to file it yourself. If your parents own a California home and you've never had the conversation about Prop 19, that's the more important one to have.
I work with families across the Valley on the long-term tax strategy side of homeownership: when to file what, how to structure ownership, how to think about inheritance and downsizing under Prop 19. If any of this raised a question specific to your situation, I'm happy to walk through it with you. Schedule a 15-minute strategy call and we'll make sure nothing slips through.
You can also watch the short version of this conversation on the Clear Way Real Estate YouTube channel. The video covers the basics of the exemption itself; this post fills in the Prop 19 connection, which has become more important since the original recording.
Justin Bonney is a California real estate agent (DRE #01338897) and the owner of Clear Way Real Estate in Sherman Oaks. He lives in Lake Balboa and specializes in Lake Balboa, Van Nuys, Sherman Oaks, Encino, Northridge, and the surrounding San Fernando Valley.
