Proposition 13 FAQ
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Proposition 13 FAQ Property Tax Appeal and Property Tax Reduction
|Example A property was purchased for $500,000. During a three-year period, the real estate market declined and recovered. The property owner filed for a decline-in-value reassessment. The following table shows the trended base value of the property, the market value of the property, and the assessed value of the property. Assuming a 2% annual consumer price index (CPI):|
In Year 1, the property’s purchase price reflected the market value and was assessed accordingly. In Year 2, the property was granted a temporary decline-in-value to reflect its current market value. In Year 3, the property was partially restored to reflect its rising market value. In Year 4, the property was fully restored to its trended base value (maximum taxable value) even if its market value was now actually higher.
Proposition 13 caps the growth of a property’s assessed value at no more than two percent a year. How can the assessed value of my property increase by more than two percent?
I recently purchased a house, and I'm paying much higher property taxes than my neighbor. How can that be fair?
Proposition 60 allows seniors to transfer the base year value of their home when they sell that home and buy another in the same county, and meet other conditions specified in the law, including: (a) Both properties must be located in the same county and be eligible for the Homeowners’ Exemption; (b) You must be at least 55 years of age; (c) The replacement dwelling must be of equal or lesser value (sales price) than the original property; and (d) The replacement dwelling must have been acquired or newly constructed within two years of the sale of the original property.
Proposition 90 also extends the transfer of assessed valuation to those moving into other counties within the state. However, participation by each county is voluntary and few counties adopted Proposition 90, so it is important to check with the Board of Supervisors and County Assessor’s office in the county to which you plan to relocate before selling your present home and buying a new one.
Note that Propositions 60 and 90 provide only a one-time exemption. The claimant and/or claimant’s spouse or any co-owner must not previously have been granted the property tax relief provided by Section 69.5 of the Revenue and Taxation Code. For more information on Propositions 60 and 90 relating to the transfer of one’s property tax base from one home to another, click here PROP 60 & 90.
Can we leave our property to our children or our grandchildren without them having to pay higher taxes?
Proposition 193 allows the transfer of certain property between grandparents and grandchildren without reassessment. However, your grandchildren must file for the Prop. 193 exemption at the time of transfer. You can get complete information about Proposition 193 and the necessary forms from your local office of the County Assessor. For additional information on Propositions 58 and 193, leaving property so that family heirs are not burdened with a tax increase, click here PROP 58 & 193.
I just got my property tax bill and I think the Assessor has increased it more than the 2% allowed by Proposition 13. What can I do about this?
That portion of the bill labeled “General Tax Levy” is the only amount controlled by Proposition 13, and this tax is limited to a maximum of 1% of the assessed value of your property (the “land” and “improvements”), and can be no more than 2% greater than the previous year’s tax bill.
The portion labeled “Voter Approved Indebtedness” is a levy to repay bonds approved by the voters. This amount varies greatly from county to county depending upon the number of local bond issues approved. Under current law, local general obligation bonds require a two-thirds majority vote to pass, except those for schools, which require only 55% voter approval.
The portion of the bill labeled “Direct Assessments” is now controlled by the HJTA sponsored Proposition 218. Assessments now require a majority “YES” vote of the property owners, with each owner voting the dollar amount of their assessment. Fees charged for the property-related services of sewer, water, and refuse collection can be imposed without a vote, but may not be greater than the cost of providing the service.
If you believe the Assessor’s valuation is incorrect, you should first call your local office of the County Assessor and discuss your valuation with an appraiser. If you cannot reach an agreement there, you should file an appeal with the Assessment Appeals Board in your county. Please note that there is a limited window of opportunity to file an appeal and be sure you meet the deadlines. For contact information for your County Assessor click here
I have just bought a new home and it looks like the Assessor has given it a value that is higher than Proposition 13 allows. What should I do?
If you believe the Assessor’s valuation is incorrect, you should strongly consider an appeal because all future taxes will be based on the first-year value of your home. Call your local office of the County Assessor and discuss your valuation with an appraiser. If you cannot reach an agreement there, you should file an appeal with the Assessment Appeals Board in your county. Please note that there is a limited window of opportunity to file an appeal, and be sure you meet the deadlines. For contact information for your County Assessor, click here.
Thanks to Proposition 218, California property owners are better protected against assessments, fees, and other tricks used to raise taxes by calling them something else.
Prop. 218 requires that an agency seeking to establish an assessment district notify the owners of all property within the proposed district by mail. The notice of the proposed assessment must include a ballot, which the property owner completes and returns to the agency or its designated agent. Each property owner is voting the dollar amount of his/her assessment. Only the ballots that are actually returned can be counted, and a majority must be in favor for the assessment to be imposed.
Prop. 218 also gives you the ability to use the initiative process to reduce or repeal any tax, assessment, fee or charge. By collecting the signatures of 5% of the number of people in the local district who voted in the last election for governor, you can put any locally imposed levy to a vote.
I recently bought my home and just got a supplemental assessment notice. What is this and why do I have to pay it?
The amount of the supplemental assessment is the difference between the prior assessed value and the new assessment on the property. This value is prorated, based on the number of months remaining in the fiscal year. Thereafter, the new owner pays the full tax based on the new assessed value. The previous owner is liable for the tax due up to the date of sale; the new owner is responsible for the tax after the date of sale. LINK TO SUPPLEMENTAL ASSESSMENTS