Paying Too Much Property Tax This May Be The Reason Why
Jun 4, 2009 Real Estate Properties
In addition to your basic property taxes, when your property tax bill seems unusually high especially during this housing crisis you probably have a Special and/or Direct Assessment on your residence. Depending on the area your house is located, there may be charges needed pay for voter-approved obligation bonds or other indebtedness, special assessments, or direct levies. For example, a Direct Assessment could be applied to your home if the voters in your community decide to establish a sewage system in a city where the were using homes use septic tanks. The direct assessment is applied pay for the sweage system to the neighborhood.
Normally, the direct assessment would be applied over a period of several years so the voters are not overwhelmed by the cost of the new improvement to their community. Special and Direct Assessments have a specific purpose, a specific improvement to a city and will only last as long as was determined to cover the cost of the community improvement. Normally, such indebtedness results in a small fraction of a percent increase in the tax rate.
Direct assessments are placed on your property tax bill by the county tax collector for the local levying agency or district, not on behalf of the assessor, auditor-controller, and/or the county tax collector departments. Keep in mind, that Special and Direct Assessments are voter approved taxes so if there is any issue with it, it did not come from the Office of the Assessor. To find out more or to dispute a special assessment on your property, contact the levying district. Normally this information is on your property tax bill.
However, you cannot refuse to pay the property tax bill that contains the direct levy amount, even if the direct levy amount is under dispute. Always keep in mind that no matter how much you disagree with what is on your property tax bill it is always better to pay the bill and get refunded later than to have a lien against on your property. The processes to delete a delinquent property tax bill and all of the fines associated with that need numerous signatures and explanations within the Assessor’s Office and Tax Collector’s Office and can be complicated. So keep it simple, always pay your bill, any exception to this would be an extreme case.
About the Author: Valerie Faltas, Property Tax Expert has been involved in all facets of real estate for over ten years including assessments, appraisals, estates and trusts, investing and much more. She is a Certified Property Tax Appraiser, Licensed Residential Appraiser and a member of the International Association of Assessment Officers. As a real estate investor and advisor she is well versed in all aspects of real estate. To contact Valerie Faltas go to her website: www.propertytaxlittleblackbook.com.
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Reduce Mellow-Roos Property Taxes
Jun 3, 2009 Real Estate Properties
The Howard Jarvis Administration was the driving force in implementing Proposition 13 which put a cap on propety taxes in the state of California. As a result, of Proposition 13 California Residents had to discover different ways to finance government community facilities in their communities like streets, schools, parks, etc. The Mello-Roos Community Facilities Act of 1982 was implemented by the California legislature, the Act created Community Facilities Districts (CFDs) to be established as a way of obtaining this crucial neighborhood funding.
The amount of Mellow-Roos Property Taxes varies from one CFD to another. Typically, an adopted formula that applies to the size of the residence (square footage or parcel size) is utilized to ascertain the amount of particular assessment. Normally, the special property tax and assessments do not go above 1% to 1.5% of the market value of new homes. Additionally, the complete amount of all annual property tax usually does not go above 2% to 2.5% of the homes taxable property base value. So if you are able to lower your taxable base value or in other words, your propety tax you will save a significant amount of money if you have Mellow-Roos Taxes on your house since of the increased percentage in property taxes you pay.
The average homeowner in most urban areas in California in todays real estate market has lost in excess of $200,000 in market value and at the normal rate of 1.25% in property taxes they will save $2,500 per year for every year they own their house! However, that same homeowner at a 2% property tax rate because of Mellow-Roos taxes will save $4,000 per year in property taxes! Learning to PERMANENTLY lower your taxable base value in California is the key to saving thousands over the course of your home ownership which is disclosed in the California Little Black Book.
Generally Mellow-Roos Property Taxes are applicable to recently built communities like sizeable Planned Unit Developments (PUD) where there have been numerous houses built at once and the property taxes are necessary to establish city services. Ive seen Planned Unit Developments that had more than 4,000 houses built! So, the county and city municipalities need to find funds to establish the roads, sewage systems, schools, recreation centers, parks and so much more. Before purchasing a home with Mellow-Roos property taxes you will be informed in the beginning negotiation stages of acquiring the house and while in escrow that these property taxes apply. You won’t be blind sighted by Mellow-Roos Taxes, it is required that you are notified prior to purchasing.
About the Author: Valerie Faltas, Property Tax Expert has been involved in all facets of real estate for over ten years including assessments, appraisals, estates and trusts, investing and much more. She is a Certified Property Tax Appraiser, Licensed Residential Appraiser and a member of the International Association of Assessment Officers. As a real estate investor and advisor she is well versed in all aspects of real estate. To contact Valerie Faltas go to her website: www.propertytaxlittleblackbook.com.
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Check out the free ebook written by Valerie Faltas, Property Tax Expert on how you can save money! property tax, lower property tax, property tax information, assessment, mellow-roos taxes, prop 13, purchase home
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Understanding Prop 13 Assessment
May 31, 2009 Real Estate Properties
California only allows two things that initiate a re-assessment: transfer in ownership (also called a transfer) and new construction. A transfer in ownership is when any part of the ownership interest in the home has changed whether money changed hands or not. The Assessorss Office will review the transfer to see if its re-assessable. If it’s an assessable change in ownership, the data is sent to the appraisal staff to give or review the value and modify the base value appropriately. A change in ownership that isn’t assessable must have fallen within the parameters of an approved exemption. A transfer into a revocable trust or an inter-spousal transfer that are both examples of exemptions allowed in California articulated in our Inherited Property and Exemptions Guide detailed in the California Little Black Book.
When a transfer is exempt, the ONLY way the Assessorss Office knows this is through forms and/or applications which are recorded along with the deed or later requested by the Office of the Assessor to confirm an exempt transfer. So when there is no exemption, the transfer in ownership is considered assessable per Prop 13. Which means if you do not apply for the exemption, submit a form or offer accepted documentation for an exemption, the transfer is considered assessable automatically. The Office of the Assessor is a mass assessment organization and unless you tell them what you need preferably through forms and documents they wont know what may or may not apply to your change in ownership.
The other trigger for re-assessment based on Prop 13 is new construction. The Assessors’s Office is told by the city or county building and safety offices. The city or building and safety give the information about issued permits to the Office of the Assessor for property tax purposes. Keep in mind, your city receives some of your property tax dollars so though its primarily a state tax your local municipality benefits from it. The permits are given to the real property appraisers to update the building record and change the base value if warranted based on Prop 13. Normally, it takes the Assessors’s Office a fair amount of time to get to since field work is necessary to find out what was done to your house and then a valuation process. If there is a demo, your property taxes will likely be reduced, if there is an addition there is likely going to be an go up. So, if you demolish a pool your property taxes will decrease and if you add a pool, your property taxes will increase. Construction varies from home to home and it will be reviewed based on the value that was added or taken away. This is clearly explained in the California Little Black Book with examples and scenarios. When was employed by the Assessor I assessed countless homes where various types of construction was done and would be happy to answer any questions you may have pertaining to this!
Like new construction there will be a re-assessment of a property if the use of it changes. For example if a complex of co-ops is converted into condominiums the Assessor will reassess the value of each unit because the change affects the market value of each unit. However, generally in California there are two events that trigger re-assessment based on Prop 13: change in ownership or new construction.
About the Author: Valerie Faltas, Property Tax Expert has been involved in all facets of real estate for over ten years including assessments, appraisals, estates and trusts, investing and much more. She is a Certified Property Tax Appraiser, Licensed Residential Appraiser and a member of the International Association of Assessment Officers. As a real estate investor and advisor she is well versed in all aspects of real estate. To contact Valerie Faltas go to her website: www.propertytaxlittleblackbook.com.
About the Author:
Check out the FREE ebook written by Valerie Faltas, Property Tax Expert lower property taxes, reduce property taxes, prop 13, assessment, assessor, california property tax
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