Property Tax Updates in California

Tax Professionals' Resource
February 18, 2013 — 1,142 views  
Become a Bronze Member for monthly eNewsletter, articles, and white papers.

According to the constitution of California, the real property which is locally assessed must be valued for the purpose of calculating property tax based on the market value on the acquisition date. For a newly built property, an assessor should establish an assessed value as on the date that the construction gets completed.

In most of the states across the US, the completion date of the construction is immaterial to the assessment of a property. This is because the property in most states is reassessed periodically or annually depending on the current market value.

Property Taxes in California

California property tax is calculated on the basis of the county where the property is located, even if a person owning it lives in another jurisdiction or county entirely. If the piece of your property is located in 2 tax districts, you as an owner are responsible to pay taxes on a proportional basis to each county.

Marin County in California collects the highest property tax by levying an average of $5,500.00 (0.63%) per annum in property taxes, while Modoc County charges the lowest tax on properties in the state, and collects $953.00 (0.6%) on an average per year.

All the properties in the state are assessed annually. The property that is owned by a person on the 1st of January has to pay a tax that is equal to 1% of the assessed value. Also, apart from the overdue of taxes, the owner of the property is responsible to pay interest as well as approved redemption charges.

Property tax information (2012-2013)

Median property taxation in California is around $2,839.00 per annum for a property worth a median value of $384,200.00. An average of 0.74% is collected as property tax by California counties for a property's estimated market value.

California's average property tax rates are one of the highest in the country, with nine states that levy higher amount of property taxes. The median income of California is $78,973 per annum and an average property tax paid yearly by the residents of California amounts to 3.59 percentage of their annual income. California is at the 15th rank as a median income percentage in the list of all states charging property taxes.

There are many exemptions on real estate taxes payable in California. People who think they can claim the exemption must apply to the office of county tax assessor for information. Some homesteads are given exemption from paying local property taxes.

Flexibility is given to disabled and senior citizens for postponing the tax. This is applicable to the principal residence only. A lien is recorded against the property. There is an interest that is payable on postponed tax. An assistance program is also available for eligible renters and homeowners. It consists of once in a year payment which depends on a portion of the tax payable on their houses or is included in their rent.

No inheritance taxes prevail in California. Estate tax is brought in line with changes in the federal estate tax law and is phased out currently. Also, there are no personal intangible property taxes charged in California.

Tax Professionals' Resource