What Is the California Tax Withholding for Buyers and Sellers?

Kitty says "Keep your eye on your withholding tax"

Very often sellers are unaware of this California tax withholding requirement to pre-pay their tax due on the gain of their property, and may equate it with capital gains tax or property taxes.

For income property sellers, and those doing property exchanges, installment sales and other transfers, this information may be most important:

The escrow officer must notify the buyer of his/her responsibility to withhold 3 and 1/3 percent of the gross sales price of real property sale, whether by an individual or non-individual such as an LLC, corporation, trust, etc., and pay it to the Franchise Tax Board, UNLESS an exemption applies.

The exemptions include sales less than $100,000; property last used as a principal residence; sales of decedent's principal residence by the estate; sale by 1031 exchange; seller's tax liability, calculated at the maximum rate (currently 12.3%) on the taxable gain, regardless of seller's actual rate, will be less than 3 1/3% of the gross proceeds and seller certifies that fact under penalty of perjury. 

For sellers in the pre-listing stage who are wanting to calculate their ultimate seller's net after a sale should be sure to give all such information to their tax adviser, if that is who is doing their calculations. Escrow is responsible for notifying the buyer of their responsibility to withhold, and the buyer must do so when escrow closes.  If the seller's actual tax rate is different than 12.3% above, then they need to consult with their tax advisor on the status of their particular state income tax requirements. 

See more information from the Franchise Tax Board  .


Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996

Have You Ever Been Hacked? What To Do Next

Online security affects all of us. Here is some new advice from the chief information officer Josh Sharfman at California Association of Realtors:

1. Isolate your computer by turning off wi-fi and unplugging the hardwired connection to the internet.

2. Change your password, but there's more on this:  Use a passphrase, as recommended by the National Institute of Science and Technology.  This means

• A unique passpharase at least 15 characters long and difficult to guess, such as "myllamahasnotoes".  Upper and lower case letters, numbers and special characters are counterproductive because a good password is one you can remember.
• Check your passphrase against a list on "Pwned Passwords at www.haveibeenpwned.com/Passwords, where you may also checks compromised accounts.
• Don't worry about periodically changing your passphrase. This may be controversial, but recent studies have shown that periodic changes are counterproductive.

 3. Enable multi-factor authentication (MFA) or (2FA).  This requires you to use two different methods of confirming your identity by text, phone call of verification code in an app. Go to www.turnon2fa.com to learn how to turn on MFA.

4. Update your security questions and responses, try to use less common questions.

5. Scan your computer using your installed antivirus software while it is disconnected from the internet. Reconnect your computer and then download updates and run antivirus scans again.

6. Reach out to your contacts to let them know you've been hacked, and you might want to give them the advice in this article!

For help on how to buy your next home, please contact me.  I have been a Realtor for 24 years, and I know how to help you. Both buyers and sellers are cautioned about wire fraud security in their transactions.  I have more information for buyers and sellers on my website at http://www.juliahuntsman.com.

Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996

Average Selling Prices for June, 2019 in Long Beach,Lakewood, Cerritos, Huntington Beach and Three Counties

View of downtown Long Beach

All these prices are for the month of June, 2019, based on data from CRMLS Infosparks:

Average prices for single family homes in Orange County were showing a slow downward trend since early 2018 but shot upward in May of this year, while Los Angeles County is trending up from $919,000 in December 2018, and San Bernardino County's average is now up the highest in the last 18 months as homeowners and investors find buying opportunity there.
The average days on market for the four cities is about the same as before.  However, in the very high end markets in Long Beach, properties over $1 million are generally on the market longer than those under $1 million.

Average single family home prices vary according to area, and here's what they look like locally:

June, 2019

Long Beach
 $661,746                 Avg Days on Market :34

Lakewood
$603,745                  Avg Days on Market : 28

Cerritos
$728,655                  Avg Days on Market :42

Huntington Beach
$1,014,446 (18 month high)   Avg Days on Market :40

Los Angeles County
$966,765 (still down from a high in May, 2018)

San Bernardino County
$377,714(highest average price in last 18 months)

Orange County
$1,087,04 (down slightly from May 2019 18-month high)

 

For condo prices, please contact me!

For an online and automated home valuation, try my site at http://www.juliahuntsman.com/home-evaluation.  It probably works more accurately for single family homes than condos in some areas, depending on what properties lie within about a one-mile radius.  Try it!  And I am always happy to do a more customized report to send out via e-mail.  If you're thinking about making a move, do it! It pays to keep an eye on things.

Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996