Author Topic: How does property tax gets evaluated?  (Read 521 times)

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Offline Kick53rv3

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How does property tax gets evaluated?
« on: July 08, 2021, 08:16:44 PM »
I am looking at the houses that have $8000 tax from last year. However that is evaluated based on the property worth $780k. If I buy that home for $1m, does that mean the property tax will be evaluated based the $1m sale price for next year?

Offline aquabliss

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Re: How does property tax gets evaluated?
« Reply #1 on: July 08, 2021, 09:09:12 PM »
Short answer: Yes, it will be based on $1M sale price for the next tax collection.  Assuming $1M is the newly assessed value.  Your new tax base will be calculated from the new property assessed value at purchase.
https://www.ocgov.com/gov/assessor/realproperty/buying#expect

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Offline Kick53rv3

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Re: How does property tax gets evaluated?
« Reply #2 on: July 15, 2021, 10:27:07 AM »
Short answer: Yes, it will be based on $1M sale price for the next tax collection.  Assuming $1M is the newly assessed value.  Your new tax base will be calculated from the new property assessed value at purchase.
https://www.ocgov.com/gov/assessor/realproperty/buying#expect

Follow up question: are all houses evaluated individually? As in my neighbor that bought 5 years ago will be evaluated with his purchase price of 700k while mine at 1M will be evaluated at 1m? Or is the whole neighborhood gets evaluated at some kind of average?

Offline Cares

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Re: How does property tax gets evaluated?
« Reply #3 on: July 15, 2021, 11:20:07 AM »
Short answer: Yes, it will be based on $1M sale price for the next tax collection.  Assuming $1M is the newly assessed value.  Your new tax base will be calculated from the new property assessed value at purchase.
https://www.ocgov.com/gov/assessor/realproperty/buying#expect

Follow up question: are all houses evaluated individually? As in my neighbor that bought 5 years ago will be evaluated with his purchase price of 700k while mine at 1M will be evaluated at 1m? Or is the whole neighborhood gets evaluated at some kind of average?

Each property is evaluated individually and based on your purchase price. That's why you hear about homes that are market valued at $1M+ but have a $200k tax basis or something.

Offline zubs

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Re: How does property tax gets evaluated?
« Reply #4 on: July 15, 2021, 11:25:46 AM »
I have a house where I pay $2,000/yr and Neighbor pays $6,000/yr due to prop 13.


How does this happen?  Buy a house back in 1980...


If you don't have a time machine, buy a house and never sell it.

Offline CLB_srA

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Re: How does property tax gets evaluated?
« Reply #5 on: July 17, 2021, 05:00:13 PM »
are there creative ways or loopholes to assume ownerbuy/buy a house without paying the increased prop tax?

Offline Cares

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Re: How does property tax gets evaluated?
« Reply #6 on: July 17, 2021, 05:07:14 PM »
are there creative ways or loopholes to assume ownerbuy/buy a house without paying the increased prop tax?

Inherit it. Or there was the article that came out recently where someone moving from Bay Area to Texas bought a home for $500k and paid for the seller's next home around $500k. In total he spent $1M but on paper and for property tax assessment it would only count $500k tax basis. I'm sure this is illegal or questionable in some way though.

Offline zubs

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Re: How does property tax gets evaluated?
« Reply #7 on: July 17, 2021, 10:25:15 PM »
I thought prop 19 which passed in NOV 2020 makes inheritor have to pay market value on property taxes.
Or is that only for investment properties?

Offline zubs

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Re: How does property tax gets evaluated?
« Reply #8 on: July 17, 2021, 10:27:30 PM »
are there creative ways or loopholes to assume ownerbuy/buy a house without paying the increased prop tax?

adopt the buyer and gift him the house?

Offline Cares

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Re: How does property tax gets evaluated?
« Reply #9 on: July 17, 2021, 11:43:37 PM »
I thought prop 19 which passed in NOV 2020 makes inheritor have to pay market value on property taxes.
Or is that only for investment properties?

Up to $1M of the reassessment is excluded in the new tax basis.

 

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