On July 1, 1983, California State law was changed to require the reassessment of property following a change of ownership or the completion of new construction. This reassessment may result in one or more supplemental tax bills being mailed to the assessed owner, in addition to the annual property tax bill. This page focuses on the supplemental tax bills generated by such reassessments of property values.

New construction could include any addition to real property (such as a new building, or adding a new room, pool or garage), or any substantial alteration to an existing structure.

Most changes in ownership caused by the sale of property result in reassessment. However, interspousal transfers, the transfer, sale or inheritance of property between parents and their children, and the addition of joint tenants may not result in the reappraisal of property values. Parent/child transfers require an exclusion filing within a limited period.

Homeowners over the age of 55 years who sell their principal residence and purchase a replacement dwelling within two years that is of equal or lesser market value, and is located within the same county, MAY be eligible to transfer the pre-sale assessed value of their original property to the replacement dwelling.

What happens when the Assessor reassesses my property?

The Assessor first determines the new value of the property, based on current market values. The Assessor then calculates the difference between the new value (set at the time of purchase or completion of new construction) and the old value. This results in the supplemental assessment value. Once the new assessed value of your property has been determined, the Assessor will send you a Notice of Supplemental Assessment

 

Example:

New value at date of purchase or completion of new construction	$220,000
Assessed value for current fiscal year	-200,000
Supplemental assessment value	$ 20,000

 

This reassessment usually results in an increase in property value. Your supplemental taxes will be calculated based on the difference in values. As a result, one or more supplemental tax bills will be issued. If the reassessment results in a reduction in value, a refund will be issued by the Auditor-Controller's Office. A reduction in value will not reduce the amount due on the annual tax bill. The annual tax bill must be paid in the amount originally billed.

 

• Appeals must be filed within sixty (60) days of the mailing date shown on the Notice of Supplemental Assessment from the Assessor.
   
• Appeals must be filed within sixty (60) days of the mailing date shown on the Notice of Supplemental Assessment from the Assessor.
   
• If you are appealing your assessment, your tax installments should still be paid before they become delinquent. If unpaid, penalties may accrue during the appeal process. If the outcome of your appeal results in a refund, it will be issued by the Auditor-Controller's Office.
   
• The supplemental tax bill is in addition to the annual tax bill. Both bills must be paid by their individual delinquent dates.
   
• Supplemental tax bills are mailed directly to you. It is your responsibility to contact your lender to determine who will pay the supplemental tax bill. Your lender will not receive this bill.
   
• If you purchase and sell property within a short period of time, the supplemental tax bill you receive should cover only those months during which you owned the property, and the new owner should receive a separate supplemental tax bill. You may not receive the supplemental tax bill until after you have sold the property. The type of supplemental tax bill you would receive in this instance would be unsecured at billing, and would have only one installment stub for payment. Check the dates used in prorating your bill, to ensure that the period covered is correct. If you believe your tax bill is incorrect, contact the Assessor's Office.
   
• You are taxed on the supplemental value for the remaining portion of the year, from the date you purchased the property or completed the new construction. However, if the event was after January 1st, you will receive an additional supplemental tax bill for the following fiscal year, which will be for the entire year.
   

Figure 1 illustrates the homeowner's obligation to pay both supplemental and annual tax bills after purchasing property or completing new construction. (NOTE: The diagram assumes an increase in property value.)

 

Figure 1.

 

If You Buy New Property or Complete New Construction

Between June 1 and December 31* Then you will be responsible for the following tax bills:

Your portion of the Annual Tax Bill ** for current fiscal year, reflecting prior assessed value.

The Supplemental Tax Bill for remainder of current fiscal year, reflecting difference between new and prior assessed values.

The Annual Tax Bill ** for the upcoming fiscal year, reflecting new assessed value.

Between January 1 and May 31* Then you will be responsible for the following tax bills:

Your portion of the Annual Tax Bill ** for current fiscal year, reflecting prior assessed value.

The 1st Supplemental Tax Bill for remainder of current fiscal year, reflecting difference between new and prior assessed values.

Since the change in value occurred after the January 1 lien date and will not be reflected on the annual tax bill for the upcoming year, you will also receive:

The Annual Tax Bill ** for upcoming fiscal year reflecting value of January 1 annual assessment.

The 2nd Supplemental Tax Bill for entire upcoming fiscal year, reflecting difference between new and prior assessed values.

 

 

* Taxes on the increase in assessed property value due to ownership changes or completion of new construction are calculated as of the first day of the month following the date of ownership change or construction completion.

** Property is reassessed each January 1st for the upcoming fiscal year (July 1 – June 30).

 

The supplemental tax bill provides the following information:

• The fiscal year for which the taxes are assessed and the applicable dates over which the tax is figured.
• The event date which generated the supplemental bill.
• The old and the new assessed values and the difference (net supplemental assessment) upon which the tax is computed.
• The type and amount of any exemptions, if applicable.
• The total amount of taxes due, based on the net increase in value.

 

Penalties of 10% are added to any installment which is not paid on or before the delinquency date, and an additional $20.00 cost is added to a late second installment.

If your supplemental tax bill is not paid by the June 30th after the second installment becomes delinquent, the property becomes tax defaulted. Your taxes can remain unpaid for a maximum of five years following tax default, at which time your property becomes subject to the County Tax Collector's Power to Sell

You may be eligible for an exemption on your supplemental tax bill, which would result in a reduction of taxes. Applications for homeowner, veteran, church, welfare or other exemptions may be obtained from the Assessor's Office