Tuesday, July 1, 2008

Reassessing Property Taxes

Appraisers get it wrong. I had to deal with the Los Angeles County Assessor's office when resolving an issue at work, and...well, I should have been a dentist. (translation = I had to pull many, many teeth for many, many months)

FMF posted a while back on how to have your property taxes reassessed in some states. Definitely something worth looking into if you were unfortunate enough to buy property at the height of the market.

Property taxes in California, however, are different. They are tied to the purchase price of the property, as opposed to market value as in FMF's post. Why? This LA Times article on Property Tax Reassessment says:
"Property tax reductions due to falling home values were established by Proposition 8, which was approved by voters in November 1978 as an amendment to the tax-limiting Proposition 13, which passed in June of that year."
Here's the scoop:
"Assessors in the five-county Los Angeles area are now in the process of cutting property taxes on more than half a million homes because of plunging home values. Notifications will go out this month and next to lucky homeowners.
Keep in mind,
"Homes bought before 2004 are not being automatically reviewed because of the way property values are set.
When a home is sold, the taxable value is set at the sale price. After that, it can rise no more than 2% a year.

Because the market value of most homes sold before 2004 increased far more than 2% annually in the first part of the decade, those properties are probably still worth more than their taxable value, even when the recent slump is considered."
So if you think you're overpaying, check out the article to see how to try to have your taxes reassessed. And be very, very patient. They're not in the business of reducing their income.


Anonymous said...

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Anonymous said...

Very Interesting!
Thank You!