What is the homestead exemption in California and how do I claim it?
California has two distinct homestead exemptions that protect homeowners in very different ways.
1. Two Concepts
The (a) property-tax homestead is a small assessed-value reduction administered by your county assessor; the (b) creditor/bankruptcy homestead protects equity in your home from judgment creditors and bankruptcy trustees. They are unrelated programs with separate filings.
2. Creditor / Bankruptcy Homestead
Under Cal. CCP § 704.730 (as amended by SB 832), the exemption equals the countywide median home sale price in the prior calendar year, with a floor of $300,000 and a ceiling of $600,000 in 2021 dollars — indexed annually for inflation. For 2024, the range runs roughly $361,113-$722,225 depending on county. Sections 704.710-704.850 set forth procedures, proceeds protections, and forced-sale rules.
3. Automatic vs Declaration
The exemption auto-attaches to a debtor's principal residence. California uniquely allows an optional "declared homestead" recorded under Civ. Code § 5404, which extends proceeds protection if you voluntarily sell.
4. Federal Bankruptcy Cap
BAPCPA § 522(p) caps the homestead at $189,050 (April 2022, indexed) for property acquired within 1,215 days before filing, even where state law allows more.
5. Property-Tax Homestead
Cal. Const. art. XIII § 3(k) and Rev. & Tax Code § 218 provide a $7,000 reduction in assessed value for owner-occupied homes; seniors and disabled veterans get larger exemptions.
6. Filing Property-Tax Exemption
File Form BOE-266 with the county assessor by February 15 for the full exemption (80% if filed by December 10).
7. Spousal Protections
A married homeowner cannot convey or encumber the homestead without spousal joinder; community-property rules amplify this.
8. Loss Triggers
Abandonment, sale without reinvestment within 6 months (CCP § 704.720(b)), or conversion to a rental defeats the exemption.
9. Foreclosure & Forced Sale Exceptions
Purchase-money mortgages, mechanic's liens, tax liens, federal liens, and family-support arrears all override the homestead.
This is legal information, not legal advice.
- You are facing a writ of execution sale on your home
- You are considering Chapter 7 with substantial home equity
- Your spouse refuses to join in a sale or refinance
- Cal. CCP §§ 704.710-704.850
- Cal. Civ. Code § 5404
- Cal. Rev. & Tax Code § 218
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.