California’s secured property tax bill pertains to property taxes levied on real property (land and structures) that are secured by a lien on the property. These taxes are based on the assessed value of the property as determined by the county assessor.
Secured Assessments:
The secured property tax bill typically includes the: i) General Tax levy, the base property tax rate, usually 1% of the assessed value of the property; ii) Voter-approved debt, additional taxes to repay bonds approved by voters for local projects such as schools, infrastructure, and public facilities; and iii) Direct Assessments, charges for specific services or improvements, such as lighting, landscaping, or flood control, which benefit the property.
The property’s assessed value is determined annually by the county assessor. Under Proposition 13, the assessed value of a property cannot increase by more than 2% per year unless there is a change in ownership or new construction. The general tax rate is 1% of the assessed value. Additional rates may apply for voter-approved measures.
Secured property tax bills are issued annually with the fiscal year running from July 1 to June 30. These property taxes are paid in two installments: the first due on November 1, delinquent after December 10, and the second due on February 1, delinquent after April 10. If payments are not made by the delinquency dates, penalties and interest are assessed; typically 10% of the amount due, plus additional monthly interest charges.
Your secured property tax bill will detail; i) the assessed value of the property; ii) the tax rate and calculation; iii) due dates and amounts for each installment; iv) any exemptions or special assessments applied; and v) instructions for payment and contact information for the tax collector’s office.
Supplemental Assessments:
An additional tax that may be levied when a property changes ownership or undergoes new construction. This tax is designed to reflect the difference between the previous assessed value and the new assessed value, either due to the change in ownership or improvements made to the property.
If reassessed due to a change in ownership or completion of new construction, you will then be notified by mail of the new value and the supplemental taxes due. If the new value is less than the previous value, it may result in a refund.
For example, if a property was previously assessed at $300,000 and the new assessment is $400,000, the supplemental tax would be based on the $100,000 increase in value. The supplemental tax is prorated based on the number of months remaining in the fiscal year (July 1 to June 30). For example, if the change in ownership occurs halfway through the fiscal year, the supplemental tax would be calculated for the remaining six months.
Property owners will receive a Notice of Supplemental Assessment, which details the new assessed value and the amount of the supplemental tax and can be due in one or two installments, depending on when the bill is issued. It’s important for property owners to pay these bills promptly to avoid penalties and interest.
Escape Assessments:
This refers to a situation where a property’s taxable value has been under-assessed or omitted from the tax roll, resulting in a lower property tax bill than what should have been charged. When the county assessor discovers this discrepancy, an escape assessment is issued to correct the property’s assessed value and recover the taxes that were not originally billed. Escape assessments can be issued for up to four prior tax years plus the current year. If fraud is involved, the period may extend further.
This can occur due to different circumstances including, but not limited to: (i) clerical errors; (ii) discovered omissions; (iii) undisclosed changes such as failing to report a transfer of title resulting from the death of an owner; or (iv) non-permitted new construction
Property owners receive a Notice of Proposed Escape Assessment, detailing the reason for the adjustment and the new assessed value. After the notice, the county issues a supplemental tax bill for the additional taxes owed due to the increased assessment.
Note:
Property owners have the right to appeal the new assessed value if they believe it is incorrect. The appeal process typically involves submitting a formal request to the county assessor’s office. Certain exemptions (e.g., homeowner’s exemption) and relief programs may apply, potentially reducing the supplemental tax amount.
Please see our other related articles
Prop 19
Homestead Exemption
Assessment Appeals
Disclaimer: Every situation is different and particular facts may vary thereby changing or altering a possible course of action or conclusion. The information contained herein is intended to be general in nature as laws vary between federal, state, counties, and municipalities and therefore may not apply to any given matter. This information is not intended to be legal advice or relied upon as a legal opinion, course of action, accounting, tax, or other professional services. You should consult the proper legal or professional advisor knowledgeable in the area that pertains to your particular situation.
