WHY IS MY PROPERTY TAX BILL GOING UP SO MUCH, AND HOW DO I KNOW IF IT’S RIGHT?
Many California homeowners are dismayed by rising property tax bills and wonder how they can verify that what they’re paying is actually correct.
All taxable properties in California are protected by Proposition 13, the 1978 ballot initiative that changed the state constitution so that the assessed value of your home generally cannot go up more than 2% per year for as long as you own it.
There are a couple of exceptions. If you make significant improvements to the property such as a room addition or garage conversion, those improvements will be assessed at their current market value, and that amount will be added to the assessed value of your home, which is otherwise unchanged. Remodeling will not cause your entire property to be reassessed.
Another exception relates to decline-in-value reassessments. If you buy a home and later the market value declines to below its assessed value, you are eligible for a new assessment at the lower value, reducing your property tax bill. However, when the market recovers, assessors are required to bring the assessment back up to what it would have been if the market had not declined. The assessed value can go up in one jump that is not capped at 2% per year, although it cannot be higher than Proposition 13 would have allowed.
If you have made changes to the title of the property that reflect a partial change of ownership, that can cause a partial reassessment.
Most of the time, unexpected increases in your property tax bill are caused by voter-approved charges such as bonds (borrowed money) or parcel taxes (extra property taxes that are not based on value). These are local charges that vary depending on the city, county or district in which your property is located.
Sometimes these taxes were passed with a promise that there would be exemptions for senior citizens or low-income households. Typically, property owners must apply for the exemption. Check your property tax bill for the list of voter-approved bonds, taxes and fees, and contact the agency, district or department that is responsible for each of those charges. Ask if you’re eligible for an exemption.
If you own your principal residence, you are eligible for the homeowner’s exemption, which will reduce your assessed value by $7,000, saving you $70 per year. Contact the office of your county assessor to apply or get more information.
Some homeowners may be able to take advantage of the state controller’s Property Tax Postponement Program. It allows homeowners who are seniors, are blind, or have a disability to defer current-year property taxes on their principal residence if they meet certain criteria, including at least 40 percent equity in the home and an annual household income of $49,017 or less. (The deferment of property taxes will be secured by a lien against the property and must eventually be repaid.) The 2022–23 application period will open on October 1, 2022. For more information, call (800) 952-5661 or e-mail firstname.lastname@example.org.
If you believe your property tax bill is wrong or that the property or improvements to it were assessed incorrectly, there is an appeals process. Contact your county assessor’s office or contact the State Board of Equalization, which oversees property tax administration. The BOE’s website is https://boe.ca.gov/proptaxes/proptax.htm, and the property tax department can be reached by phone at 916-274-3350 or PTWebRequests@boe.ca.gov by e-mail.