Reference: Ocean Avenue LLC v. County of Los Angeles and R&TC Section 46(a).

In the above case, three individuals/entities bought all of the membership shares of Ocean Avenue LLC without any of them having a controlling interest.  Because there was no change in controlling interest, there was no new assessment of the underlying property owned by Ocean Avenue LLC (a hotel in Santa Monica). The case hinged on close relationships between the three buyers.  Although the case cannot be cited or relied upon in court (decertified), it does highlight the rules under CA Revenue & Tax Code Section 64(a) where a change in control of the underlying ownership entity does not exist.

This is a possible planning tool, but must be undertaken only after careful consultation with a real estate tax attorney familiar with the complexities of R&TC Section 46.