The ULA Tax
April 1st, 2023, marks the day California’s housing bill, United to House L.A. (ULA), takes effect. The housing bill was created to fund more affordable housing to decrease homelessness in California. However, with this bill comes a much higher sales tax on property that exceeds $5 million dollars in value.
What Does the ULA Tax Mean for California Property Owners?
Property owners will now be taxed at a rate of 4% on properties sold or transferred for more than $5 million and at a rate of 5.5% on properties sold or transferred for more than $10 million. The new tax applies to all real estate sales. These sales include residential homes, commercial buildings, and vacant land transactions. This tax rate is among the highest in the country.
Those who support ULA argue that the tax money could help with the homelessness crisis. However, those who oppose the bill believe the tax policy will inevitably lead to higher home prices and bureaucracy. In addition, opponents of this bill strongly believe that this is not just a tax on mansions, as many homes in California have a value of $5 million. Moreover, since this new tax measure also applies to apartment buildings, this will increase tenant rent.
If you are concerned about the implications of the ULA tax, contact us today to discuss your personal situation. Our trusted attorneys can advise on ways to preserve your wealth through tax planning, estate planning, and trust administration. Contact Law & Stein today.