Estate Tax Planning Attorney in Camarillo

Estate Tax Planning Attorney in Camarillo

Most people who ask me about estate tax in Camarillo do not have an estate tax problem. They have a property tax problem and a capital gains problem, and those two are worth real money to solve. Being clear about which is which saves families from paying for planning they do not need while ignoring the exposure they actually have.

I am an estate planning attorney serving Camarillo and all of Ventura County. For the planning that applies regardless of estate size, see estate planning in Camarillo.

Where the federal exemption stands

The federal estate and gift tax exemption is $15 million per person as of 2026, following the 2025 federal tax legislation that made the higher exemption permanent and reset it at that level. A married couple with proper planning can shelter twice that. The tax rate above the exemption is forty percent.

The scheduled reduction that estate planners spent years warning about did not happen. If you were told in 2021 that the exemption was going to be cut roughly in half at the end of 2025 and that you needed to act before then, that advice is out of date. Plans built around that assumption are worth revisiting, particularly irrevocable structures created in a hurry to use exemption that turned out not to be disappearing.

California itself imposes no estate tax and no inheritance tax. A Camarillo estate owes nothing to Sacramento on the transfer.

Portability, and the return nobody files

When the first spouse dies, their unused federal exemption can transfer to the survivor. That is portability, and the transferred amount is the deceased spousal unused exclusion. It is not automatic. The estate has to file a federal estate tax return, Form 706, and affirmatively elect it, and the deadline is nine months after death with a six-month extension available.

Families skip this constantly, because the first death produced no tax and filing a return for an estate that owes nothing feels pointless. Then the survivor’s assets appreciate, or the survivor remarries, or the exemption changes, and the unused exemption that could have been preserved is gone. For estates anywhere near the threshold, filing to preserve portability is cheap relative to what it protects.

The tax that actually hits Camarillo families

A Camarillo couple who bought in 1985 for $150,000 and now owns a home worth $1.1 million has an unrealized capital gain of roughly $950,000. If they gift that house to their children during life, the children take the parents’ basis and inherit the entire gain. If the children inherit it at death instead, the basis steps up to the date of death value and the gain evaporates.

This is why well-intentioned lifetime gifting of a Camarillo home is so often a mistake. The parents avoid nothing meaningful and hand their children a six-figure tax bill that would not have existed. California is a community property state, which makes this better for married couples: on the first death, both halves of community property receive a new basis, not just the decedent’s half. Getting the character of the asset right matters.

Proposition 19 is the other half of the problem

Proposition 19 narrowed the parent-child exclusion from property tax reassessment sharply. A child inheriting a Camarillo home generally must make it their own principal residence to claim any exclusion, and even then the exclusion is limited, with value above the cap added to the base year value. A child who intends to rent it out or hold it as a second home gets no exclusion, and the property is reassessed to current market value.

For a family holding a low Proposition 13 base from the 1980s, that reassessment can multiply the annual property tax bill. There are planning responses, and some of them only work while the parents are alive and have capacity. Waiting until after a death removes most of the options. See Prop 19 planning.

When a Camarillo estate does need real estate tax work

Some Camarillo estates genuinely do approach or exceed the federal threshold. Owners of agricultural land in the Pleasant Valley area, families holding multiple rental properties across Ventura County, and business owners whose company value is not obvious on a balance sheet are the recurring examples. Life insurance is another, because a policy you own is included in your taxable estate at its full death benefit.

For those estates the tools include irrevocable life insurance trusts to move the policy out of the estate, qualified personal residence trusts, spousal lifetime access trusts, valuation discounts on closely held interests, and structured lifetime gifting using the annual exclusion, which is $19,000 per recipient in 2026. See high-net-worth estate planning in Camarillo.

Questions Camarillo clients ask

Does California have an estate tax or an inheritance tax? No. California imposes neither. The only transfer tax that applies to a Camarillo estate is the federal estate tax, and it applies only above the federal exemption.

What is the federal estate tax exemption in 2026? $15 million per person, following the 2025 federal tax act, indexed for inflation going forward. A married couple can shelter twice that with proper planning. The rate above the exemption is forty percent.

Should I give my house to my kids now to avoid taxes? Usually no. A lifetime gift carries your basis to your children, so they inherit your entire unrealized capital gain. Inheriting at death gives them a stepped-up basis instead. Lifetime gifting of a long-held Camarillo home often creates a large tax bill that would not otherwise exist.

What is portability and do we have to do anything to get it? Portability lets a surviving spouse use the deceased spouse’s unused federal exemption. It requires filing Form 706 and electing it, generally within nine months of death with a six-month extension available. It is not automatic and it is commonly missed.

How much can I give away each year without tax consequences? The annual gift tax exclusion is $19,000 per recipient in 2026. Gifts within that amount require no return and do not reduce your lifetime exemption. Larger gifts require a gift tax return but generally produce no tax, they just draw against the exemption.

Will my children’s property taxes go up when they inherit my Camarillo house? Under Proposition 19, probably yes unless a child makes it their principal residence, and even then the exclusion is capped. A child who rents it out or keeps it as a second home gets no exclusion and the property is reassessed to market value.

Book a consultation at https://ridley.click/eric-60 or call 805-244-5291. I serve Camarillo and all of Ventura County. To model a specific estate, see the estate tax calculator.