Are you paying too much in property taxes?
Every year, beginning in July, California property owners have the chance to appeal their property taxes if they feel the tax bill is higher than it should be.
As real estate experts, serving Bay Area buyers, sellers, and homeowners, we at Sequoia Real Estate want to make sure you know tax appeals are an option. Here’s an insider look at how the process works in five simple steps.
Step 1: Find Your Current Assessed Value
In California, most of your property taxes are based on the value of your home. But, thanks to state legislation from the 1970s, the value can only increase by up to 2% per year, starting from the time you either purchased the house or completed new construction on the house.
The value that the County Assessor is using to determine your property taxes is called the assessed value. You can find this amount on the “Notice of Assessed Value” that you receive in the mail each year. Or you can go to your County Assessor’s website, where you can find a value search option to look up the value online.
Step 2: Decide if the Assessed Value is Too High
To decide if the Assessed Value is higher than it should be, you need to know the market value of your home as of January 1 of the current year. January 1 is the “lien date” that assessors use for tax purposes since home values can fluctuate month to month (or even day to day).
You could search property records online to find comparable homes that sold around January 1, then adjust those sales prices to account for the differences between those homes and yours in a process called “running the comps.” But, since Sequoia Real Estate offers this service for free, just contact us, and we’ll take care of it for you.
When you contact us, please specify that you need to know the value as of January 1 for property tax purposes. We normally run comps to find the current market value for people who want to sell their homes, and of course, your home value could have changed dramatically in the months since January 1! So we want to make sure we’re using data for the right date.
If the assessed value is higher than the market value as of January 1, you have grounds to appeal.
Important: Home values across the Bay Area skyrocketed in 2021, so for 2022, most homes will actually be under-assessed. This means that the Tax Collector is charging you property taxes based on less than your home is actually worth. And that’s a great thing! But you still want to check to be sure.
Step 3: File a Property Tax Appeal
Each county in California has a Property Tax Appeals Board that reviews appeal applications. Many counties allow you to file your appeal through an online portal, while some simply have a form you can download and mail in.
It’s worth noting that some counties charge an application fee (usually between $20 and $50). And you must submit your appeal before the deadline.
For the Greater Bay Area, 2022 deadlines are:
Alameda - 9/15
Contra Costa - 11/30
Marin - 11/30
Napa - 11/30
San Francisco - 9/15
San Mateo - 11/30
Santa Clara - 9/15
Santa Cruz - 11/30
Solano - 11/30
Sonoma - 11/30
Step 4: Present Your Comps
It may take your County Board several months to process your application. They’ll send you a notice with an appeal number once your application has been processed. The Board might ask you to contact the County Assessor’s office to informally discuss the assessed value, or they might have the Assessor’s Office contact you. Either way, all you have to do is provide the information on the comps that we prepared for you when we established your market value as of January 1. There may be some negotiating, and hopefully, the Assessor’s Office will agree to reduce the value of your property tax bill!
If you and the Assessor’s Rep can’t see eye-to-eye, you can request that the case proceeds to a formal hearing in front of a Hearing Officer or the Board itself. This is rarely necessary for residential property taxes, but it’s an option.
Step 5: Collect Your Savings
If the Assessor’s Office or Assessment Appeals Board finds that you were over-taxed, they will correct your tax bill. If you’ve only made one of the two tax installments, you’ll get a reduced tax bill for your second installment. If you’ve already made both installments, you’ll get a refund.
Contact Us Today for Your Home Values
Even if you think your home value is higher than your assessed value, it can’t hurt to check! And Sequoia Real Estate is always happy to help you determine the market value of your home. So don’t hesitate to contact us for a free, no-obligation home valuation.