California Property Tax-A Basic Summary
admin | Nov 14, 2009 | Comments 0
The following information is presented as a simplified discussion of the law relating to California property taxes. California property taxes under Proposition 13 and Proposition 8 are explained in more detail on subsequent pages.
California property taxes are regulated under the provisions of the Property Taxes Law Guide as provided for in Proposition 13 (Prop 13). This proposition, officially titled the “People’s Initiative to Limit Property Taxation” became law in 1978 after the voters in the state of California were fed up with the high property taxes based on the increases in the valuation of their homes. Soon to follow would be Proposition 8 (Prop 8 ) which would provide for reductions in value when property values decreased.
In simplified language for the purpose of understanding valuation as it pertains to property taxes, all property is valued at its base year value upon the completion of new construction or a change in ownership. Prop 13 holds that once this base year value is determined it can only be raised by 2% each year regardless of how high the actual value of the real property is. In contrast, Prop 8 holds that in any given year where the value on the lien date is less than the enrolled value the assessor may reduce the value. More on Prop 13 and Prop 8 on the following pages.
Under the California property tax system there are many ambiguities. To understand this reality one need only read the report by Eric Miethke, an attorney who wrote a guest commentary for the California Taxpayers’ Association entitled “Why Taxpayers Hate the Property Tax System“. To quote one of his thoughts:
Most practitioners and property tax managers share a common bond: they feel that rather than being a system of adjudicating legitimate disputes, the property tax appeals process has become a system of rubber-stamping assessor values, even when those values are arbitrarily determined.
How could practitioners and property tax managers come to this conclusion? Simply stated, because it is the correct one. The property tax appeals system is inherently unfair, and is designed to provide maximum revenue collection and de minimus due process for taxpayers…
This system of justice is not in a Third World dictatorship, but in California, a state that proudly touts its taxpayer-friendly, pro-business environment. That any taxpayer could ever prevail under this system is the best objective proof we have of the existence of a Supreme Being.
We concur.
Under this property tax system, property taxes are based on the assessor’s opinion of fair market value on the base year date or on January 1 of each year. When a property tax payer or property owner does not agree with the value placed on the role by the assessor’s office, it may be appealed to the Assessment Appeals Board. Once a determination is made by the Assessment Appeals Board it is final. The only further remedy is filing a case in Superior Court.
Go to WHY TAXPAYERS HATE THE PROPERTY TAX SYSTEM
Go to PROPERTY TAX REDUCTION FOR RESIDENTIAL PROPERTIES
Go to PROPERTY TAX REDUCTION FOR COMMERCIAL PROPERTIES
Appeals deadlines are rapidly approaching and once past all opportunity is lost until the following year. Please contact us now at (888) 678-9TAX or fill out the simple form below and we will contact you at your convenience.
Comments or questions are welcome.
Filed Under: Property Tax Process
