Property Taxes in CA and Prop 13
For many home buyers in Calfornia including first time home buyers and out of state home buyers, there are questions regarding property tax rates. Property taxes in California are based on the purchase price of the home and taxed at 1% with local bond charges and assessments added to that amount. The taxes are paid twice a year and are considered delinquent if not paid by December 10th and April 10th. Since assessed property values in San Diego rose 6% last year most homeowners will only see a small increase in their property tax bill due to Proposition 13.
In 1978 Californians passed Proposition 13 which limits the amount a property tax can increase by 2 percent or by the rate of the California Consumer index, whichever is less. If a property decreases in value, the homeowner may petition the San Diego County tax assessor to lower the tax rate by providing recent comparable home sales to support the decrease in value.
The limit on the tax increase does not exist if the home is sold or completely torn down and re-built. The new tax rate will be based on the new cost of a purchased home or the cost plus construction cost of a re-built home. This re-assessment of a re-built home can be mitigated by retaining a percentage of the original home during the remodel.
In 1982 the California State legislature passed a Mello-Roos bill affecting property taxes. It was basically a way to circumvent Proposition 13 and allows for additional property taxes to be assessed in areas which are in need of additional financing. Primarily newer subdivisions or community facilities districts that need funding for infrastructure, schools, roads, and public works. These additional Mello-Roos taxes are not limited by Proposition 13 and in order to invoke new Mello-Roos taxes on established neighborhoods require a 2/3 vote by the local government. Mello Roos taxes vary by community and can be researched via the public tax records.
For questions regarding the deductibility of Mello-Roos taxes or the implications of a major home remodel and it’s affect on your property tax rate, it is recommended that you consult with a CPA or licensed tax attorney.
Ginger Marshall, Prescott Home & Ranch, Investment property for sale, rental homes for sale, Precott cabins for sale, Homes in the Pines for sale, Homes with views of Thumb Butte, views of Granite Mountain, Mountain view homes for sale, Horse property for sale, horse property with barn for sale, Chino Valley Homes for sale, Retire Prescott, Prescott retirement communities, Williamson Valley homes for sale, Horse properties in Prescott with Barns, Homes for sale in StoneBridge, Talking Rock, Hassayampa, Granite Hills, American Ranch, Mint Creek, Inscription Canyon, Granville, Pronghorn Ranch, Relocate to Prescott, Prescott Valley homes for sale, Homes for sale in Downtown Prescott, Homes for sale near Lynx Lake, homes for sale near Watson Lake, Senior housing for sale in Prescott