Adjusting property taxes for calamities
California’s property tax laws provide a mechanism for the Assessor to adjust assessed values to recognize destruction caused by a calamity or misfortune which damages real or personal property. To qualify for a calamity adjustment the property must have suffered more than $10,000 worth of damage and the owner must file a claim form with the Assessor within 12 months of the date of the calamity. Calamities do not include damage which occurs over time such as termite damage, gradual earth movements or vineyard diseases such as phylloxera. There are slightly different rules that apply depending on whether the damage is caused by a widespread event that results in a Governor’s proclamation of disaster or by a specific misfortune such as fire or landslide.
Once the Assessor discovers or is notified of the misfortune by either the property owner, the media or local authorities, a claim form is sent to the owner of the property. The claim form asks for the type of disaster, date of occurrence and an estimate of what the repair cost will be. When the claim form is returned, the real property field appraiser will visit the property to document the extent of the damage and to discuss the repair schedule with the owner. The Proposition 13 factored base year value of the property will then be reduced as of the date of damage or destruction to reflect the percentage of damage that the property suffered. If a structure was completely destroyed, the value will be removed. A roll correction will be sent to the County Auditor which will result in either a lower tax bill if still due or a refund if already paid.
The value is reduced or removed during the time the property is in a state of disrepair and then reinstated when the property is repaired. If the structure is restored to its original condition, the original Proposition 13 base year value is enrolled plus the appropriate time factor. If a better quality or larger structure is built as a replacement, credit is given for the base year value of the original improvement and then additional value is added for the current market value of the upgraded or larger structure. In the case of a destroyed manufactured home installed before 1980 which was paying a registration fee to Sacramento, the replacement home will go on the property tax rolls, but a value will be enrolled so that the property taxes do not exceed the amount of the prior registration fee.
Owners of properties who suffered qualifying damage in the August 24, 2014 earthquake can also apply to delay the payment of the December 10, 2014 property tax bill. An application for deferral must be submitted with the calamity reassessment claim no later than December 10, 2014. Taxes would be deferred until 30 days following the receipt of a corrected bill that reflects the temporary reduction in value caused by the earthquake. Owners of property damaged in the August 24, 2014 earthquake should contact the Assessor Division at 707.259-8740 or firstname.lastname@example.org