Owners, who suffer damage to their property as the result of a calamity or disaster (such as accident, fire, earthquake, or flood) may be eligible for certain, limited forms of property tax relief under Revenue and Taxation Code Section 170 (R&T 170).

In order to qualify for relief offered by R&T 170, damage to taxable property must be at least $10,000 and certain other requirements must be met.

IMPORTANT NOTE: R&T 170 tax relief is very limited. Do not expect it to provide substantial help in repairing your property.

1. What is a calamity?
2. What types of calamity property tax relief are available under R&T 170?
3. How is the calamity reduction calculated?
4. After my property is repaired or rebuilt, will my property taxes be increased?
5. If I disagree with the Assessor’s calamity reassessment or if the Assessor denies my claim, do I have any appeal rights?
6. If my furniture was ruined by the flood, can my property taxes be reduced?
7. Do boats and airplanes qualify if they were damaged by a calamity or disaster?
8. Do I qualify for a property tax reduction if my roof leaked during the heavy rains?
9. Do I qualify for property tax reduction if high winds and flooding damaged my orchard or vineyard?

1. What is a calamity?

The courts have defined "disaster, misfortune, or calamity" as an event out of the ordinary; an unforeseeable, sudden, or unusual occurrence, in contrast to gradual deterioration or worsening condition over time. Damage to a building or land that occurs gradually due to ordinary natural forces is not caused by a calamity.

2. What types of calamity property tax relief are available under R&T 170?

Temporary prorata value reduction: If a property qualifies, its assessed value on the current tax roll will be reduced by the same percentage as the percentage reduction in market value suffered by the property due to the calamity or disaster.

To qualify for calamity property tax relief, you must file a calamity claim application with the county assessor within 12 months of the date of damage. The loss estimate must exceed $10,000 to qualify the property for this relief. The property will be reassessed according to its damaged state and property taxes will be adjusted accordingly.

That reduction will remain in effect from the first day of the month in which the damage occurred to the last day of the month in which repairs are completed.

This property tax relief is available to owners of real property, business equipment and fixtures, orchards or other agricultural groves, and to owners of aircraft, boats, and certain mobile homes. It is not available to property that is not assessable, such as state licensed mobile homes or household furnishings.

3. How is the calamity reduction calculated?

Let's use the following example of a calamity claim with damage repaired in 6 months:

Real property that has a market value of $200,000 suffers $50,000 flood damage in January. Repairs are completed the following June.

Calculation of the Assessment Reduction: 

• Determine the percentage of damage to Market Value:
  $50,000 divided by $200,000 = 25% Market Value damage 
  
  
• Apply that percent of damage to the Assessed Value on the tax roll:
  The property's factored base year value (Prop 13) on the tax roll is $100,000. Therefore, 25% of its factored base year value is $25,000. 
  
  
• Apply the loss to the factored base year value to reflect only the period between damage and completion of repairs:
  The repairs are complete in six months, so we adjust the $25,000 loss to reflect its duration of 50% of the year. 50% of $25,000 = a $12,500 net reduction in factored base year value.

Because property taxes are 1% of assessed value, a reduction of $12,500 in factored base year value amounts to a net savings of about $125 in property taxes owed.

Note that the amount of damage suffered was $50,000 but the calamity tax relief totals only $125. As you can see, this form of relief can be very limited.

4. After my property is repaired or rebuilt, will my property taxes be increased?

Yes, but only to the level they were before the damage occurred. That is true if the improvements are rebuilt in a like or similar manner, regardless of the actual cost of rebuilding. However, if additional living space or other significant improvements are made in addition to the repair, additional taxes may result.

5. If I disagree with the Assessor’s calamity reassessment or if the Assessor denies my claim, do I have any appeal rights?

Once the Assessor has reassessed the property to reflect the damage, the Assessor must notify the owner in writing of the reassessment. You have 6 months from the date of the postmark of that notice in which to file an assessment appeal with the Sacramento County Assessment Appeals Board ((916) 874-7894). If the assessor denies the claim, you may still file an appeal within the prescribed 6-month period. The Appeals Board will then hold a hearing to determine whether or not it has jurisdiction in the matter. If it accepts jurisdiction, then a hearing as to the proper calamity assessment will be scheduled for a later date.

6. If my furniture was ruined by the flood, can my property taxes be reduced?

No. Household furnishings are not assessed for property taxes and therefore do not qualify for property tax relief.

7. Do boats and airplanes qualify if they were damaged by a calamity or disaster?

Yes. Tax reduction is available for all damaged taxable property, including boats, aircraft or other business personal property.

8. Do I qualify for a property tax reduction if my roof leaked during the heavy rains?

If the leaks are due to the age and normal deterioration of the existing roof, the leaky roof won't qualify you for property tax relief. However, if your roof was damaged by a falling tree or heavy winds and the damage exceeds $10,000, you may qualify for tax relief.

9. Do I qualify for property tax reduction if high winds and flooding damaged my orchard or vineyard?

Yes. Tax relief is available if the damage to the trees or vines exceeds $10,000. However, since the crops produced by the trees or vines are not assessed for property tax purposes, no property tax relief is available for crop losses