In the aftermath of the recent barrage of winter storms wreaking havoc across California, homeowners facing significant damage to their properties may find solace in a potential property tax reduction.

Here's what you need to know:

Reassessment Eligibility: Property owners whose homes incur at least $10,000 in lost market value due to storm damage can apply for reassessment under state law. The application must be submitted to the county assessor's office within 12 months of the incident unless the county offers an extended deadline.

Scope of Relief: The reassessment relief extends beyond residential homes to include any property assessed for tax purposes severely affected by the storms, such as business equipment, orchards, aircraft, and certain manufactured homes. However, damaged furniture or appliances do not qualify for tax breaks as they are not part of the property's assessed value.

Reduction and Refunds: If the application is approved, the property's assessed value will be reduced retroactively to the date of the damage. Property owners may also be eligible for a refund if property taxes have already been paid for that period. Alternatively, the reduction will apply in future tax assessments until the damage is repaired, the property changes ownership or the taxable value is transferred elsewhere.

Application Process: Homeowners can obtain disaster-related reassessment application forms from their county assessor's website. These forms typically require proof of damage, such as repair bills or construction estimates, and must be signed under penalty of perjury.

Additional Relief under Prop. 19: Proposition 19, passed in 2020, offers further relief to homeowners whose properties have been substantially damaged or destroyed in declared emergencies. It allows the transfer of taxable value to a newly purchased or constructed house within two years of selling the damaged property. This provision applies to properties that lost more than half of their market or improvement value in a disaster declared by the governor.

With Governor Newsom declaring emergencies in multiple counties affected by recent storms, homeowners should explore these avenues for potential relief and consider the implications of Proposition 19 for long-term tax benefits.

03/02/2024