Are you paying too much in California real estate taxes? Property tax bills can be an unpleasant shock when they come around each year, especially if you aren’t considering these ways you might be paying too much in real estate tax:
You Haven’t Checked for a Homeowner’s Exemption
A homeowner’s exemption allows you to exempt a certain amount of your property’s value if it’s your primary place of residence. This means you have to live in the property, though you don’t have to live in it 12 months out of the year. It just has to be your principal residence. Rental units, vacation homes, and investment properties can never qualify for a homeowner’s exemption.
In California, this exemption lets you take $7,000 in assessed value from your property tax assessment. In order to get the exemption, you do have to file a claim form with your County assessor. The good news is that once you have done that you don’t have to do it again unless the title deed changes hands.
Don’t confuse the homeowners exemption with a homestead exemption. If you are moving to California from another state, you may have heard of the homestead tax exemption, and in some states this is the same as California’s homeowner’s exemption. In California, the homestead exemption is a bankruptcy exemption that protect your property from creditors.
You’re Just Accepting Your Assessment
Your California real estate taxes are based on the assessed value of your home. Be sure to check that assessment and make sure it seems reasonable. It’s not unheard of for local governments to over assess the value of a property. If your property has not been assessed in many years, then you’re likely paying taxes on an assessed value that is lower than the genuine value. In this case, it’s not worth it to ask for reassessment. However, if your assessments keep going up every year, or if you’ve been recently reassessed and believe that the assessment is a lot higher than the true value of your home, be sure to challenge it.
You’re Not Claiming Your Veterans’ Exemption
If you are serving in the military or have been honorably discharged, California provides some special exemptions. For veterans in general, California offers a $4,000 property exemption. You as the veteran can claim this, and if you are the spouse or parent of a deceased veteran, you can also qualify for this exemption. Bear in mind, however, that if you own more than $5,000 of real or personal property, this exemption doesn’t apply.
The disabled veterans exemption is even more generous. The basic exemption for disabled veterans is $100,000 compounded annually by inflation. If you qualify as a low-income disabled veteran, the base amount goes up to $150,000. In 2018, the yearly income limit to qualify as low-income was $60,490.
You Haven’t Claimed Your Senior Exemption
Under propositions 60 and 90, homeowners 55 and older can move into a new home without increasing their property tax obligations. This is a great deal when combined with Proposition 13, which allows seniors to keep their home’s appraised value basically what it was when they first purchased it. That lower tax obligation then gets transferred if you buy a new home. Just bear in mind that you can only claim these exemptions once in a lifetime.
Pay the Right Amount of California Real Estate Taxes
To learn more about your California real estate taxes and make smart decisions when buying or selling your home, contact Teresa Mack today. She has the experience and expertise you need to make sure you are not paying too much in real estate taxes.