Property tax reassessment in California is a process that adjusts the assessed value of a property to its current fair market value. This can result in an increase or decrease in property taxes.
Key Facts
- Change in Ownership: One of the main triggers for property tax reassessment in California is a change in ownership. This can occur through a purchase, gift, inheritance, or other means.
- Completion of New Construction: If there is new construction on a property, such as the addition of new buildings or additions to an existing structure, it can trigger a reassessment of the property’s value.
- Exclusions from Reassessment: There are certain exclusions from reassessment that may apply in specific situations. For example, transfers of a principal place of residence between parents and their children, transfers between spouses, and transfers between registered domestic partners may be excluded from reassessment.
- Proposition 13: Proposition 13 requires the county assessor to reassess a property to its current fair market value as of the date ownership changed. If the current market value is higher than the previously assessed Proposition 13 adjusted base year value, property taxes may increase. Conversely, if the current market value is lower, property taxes may decrease.
Triggers for Reassessment
Several factors can trigger a property tax reassessment in California, including:
Change in Ownership
A change in ownership, such as a purchase, gift, or inheritance, is one of the most common triggers for reassessment. When ownership changes, the county assessor reviews the property to determine its current fair market value. This value is then used to calculate the new property taxes.
Completion of New Construction
The completion of new construction on a property can also trigger a reassessment. This includes the addition of new buildings, additions to existing structures, or other improvements that increase the value of the property.
Exclusions from Reassessment
There are certain exclusions from reassessment that may apply in specific situations. These exclusions include:
- Transfers of a principal place of residence between parents and their children
- Transfers between spouses
- Transfers between registered domestic partners
Proposition 13
Proposition 13 is a California law that limits property tax increases. 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.
When a property is reassessed, the county assessor must use the current fair market value as of the date ownership changed. If the current market value is higher than the previously assessed Proposition 13 adjusted base year value, property taxes may increase. Conversely, if the current market value is lower, property taxes may decrease.
Sources
- Title Advantage: Tax Reassessment Flyer
- California State Board of Equalization: Frequently Asked Questions – Change in Ownership
- California State Board of Equalization: Legal Entity Ownership Program (LEOP) – Result of Change in Control and/or Change in Ownership
FAQs
What is property tax reassessment?
Property tax reassessment is the process of adjusting the assessed value of a property to its current fair market value. This can result in an increase or decrease in property taxes.
What triggers a property tax reassessment?
Common triggers for property tax reassessment include:
- Change in ownership
- Completion of new construction
- Remodels or renovations that increase the value of the property
- Government-mandated changes, such as the addition of a new sewer line or road
Are there any exclusions from reassessment?
Yes, there are certain exclusions from reassessment that may apply in specific situations. These exclusions include:
- Transfers of a principal place of residence between parents and their children
- Transfers between spouses
- Transfers between registered domestic partners
How often is my property reassessed?
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. Therefore, your property will only be reassessed when one of these triggers occurs.
How can I find out if my property has been reassessed?
You will receive a notice from your county assessor if your property has been reassessed. This notice will include the new assessed value of your property and the amount of your new property taxes.
What if I disagree with my reassessment?
If you disagree with your reassessment, you can file an appeal with your county assessment appeals board. The board will review your assessment and make a decision on whether to uphold or reduce it.
How can I lower my property taxes?
There are a few ways to lower your property taxes, including:
- Applying for property tax exemptions
- Filing an appeal to reduce your assessment
- Requesting a reassessment if you believe your property value has decreased
Where can I get more information about property tax reassessment?
You can get more information about property tax reassessment from your county assessor’s office or the California State Board of Equalization website.