WILL YOUR CALIFORNIA PROPERTY TAX SKYROCKET IN 2020?
For the first time in over 40 years, annual tax rates for business owners could become unguarded to dramatic increases. Until now, Proposition 13 has held Government collection at bay by allowing a maximum tax payment of only 2% increases from the previous year. Approved by voters in June of 1978, Proposition 13 limits a property's assessed value to the year it was purchased. Subsequent tax increases are always based off the initial purchase year, regardless of current market values.
For example, if you had purchased a distressed property in 2009 for $500,000, your tax rate would not change from that base year value even though your same property is now worth $1,000,000 in 2019.
Currently, a reassessment for a new property tax rate only occurs upon transfer of title. There a few exclusions, including allowing for heirs and spouses to take control of real properties without a change to the annual property tax.
This could all be changing come November 2020. The State of California will see a "split roll" ballot initiative, potentially removing protections on commercial properties while leaving residential real estate still covered by Proposition 13. READ MORE