Wednesday, February 8, 2012
1. What is a supplemental tax bill?
A supplemental tax bill is generated whenever a property is reassessed due to a change in ownership (a sale, transfer, or transfer of fractional interest); or undergoes new construction. The supplemental tax bill reflects any increase or decrease in property tax generated by the supplemental event.
2. When will I receive my supplemental bill?
Bills are typically generated after the triggering event has been reappraised. There is no statutory timeline for their issuance as there are for annual bills. It may take up to 2 years for our office to appraise new construction and changes in ownership as a result of our existing heavy workload.
3. When will I receive my supplemental refund?
If your supplemental assessment results in a net decrease you may receive a supplemental refund. Once the new assessment is enrolled, the Assessor’s Office will mail a Notice of Supplemental Assessment letter on the last Friday of the month. The Assessor’s Office is then required by law to hold the assessment a minimum of 30 days to allow the owner time to request a review of the assessed value or file for any applicable exemption. Once more than 30 days have passed from the Notice date, on the first Tuesday of the first full week of a month, the Assessor’s Office electronically transmits the assessment to the Auditor and authorizes the negative supplemental assessment. This begins the Auditor’s Office processes. The Auditor will not issue a supplemental refund until both installments of the annual bill are paid in full. Once the annual bill is paid and the assessment is transmitted and authorized, it may take an additional 90 business days before the Auditor will issue a supplemental refund.
4. What qualifies as new construction or a change of ownership?
New construction is:
Any improvement to real property, such as adding a room, pool or garage;
Any alteration which restores a building or other improvement to the "substantial equivalent of new" (such as completely renovating a building);
An alteration that changes the way a property is used (e.g. a residence is converted to a retail store, or a garage is converted to living area);
Only the newly constructed portion may be reassessed.
Changes in ownership are:
The sale or transfer of a property.
It should be noted that certain forms of property transfer are not subject to reassessment. Exceptions include:
For further information or exclusion claim forms, please contact the Assessor's Office Property Transfer staff at (916) 875-0750.
5. What happens when the Assessor reassesses my property?
The Assessor determines the fair market value of that portion newly constructed or changed ownership based on the event date. Once the new assessed value of your property has been determined, the Assessor will send you a Notice of Supplemental Assessment that will show the new assessed value as well as the net supplemental assessment amount.
Example:
New value at date of purchase or completion of new construction: $320,000
Prior assessed value on current main tax roll: - 200,000
The Net Supplemental Assessment increase will be: + $120,000
If the net supplemental difference is a positive amount, a bill will be generated if the bill amount is over $10.
If the net supplemental difference is a negative amount, a refund will be generated if the amount of refund is over $10 and the annual tax bill has been paid in full.
6. Can I file an appeal of a supplemental assessment?
Appeals of supplemental assessments must be filed with the Assessment Appeals Board (not the Assessor) within sixty (60) days of the mailing date shown on the supplemental bill or the supplemental refund check.
If you feel a supplemental assessment is incorrect, we recommend that you discuss the assessment with the Assessor as soon as possible after receiving your "Notice of Supplemental Assessment" and prior to filing an appeal. If you can provide the Assessor with convincing evidence that the assessment was incorrect, the assessment could be corrected without an assessment appeal hearing.
Important: Filing an appeal does not relieve the applicant from the obligation to pay the taxes on the subject property on or before the applicable due date shown on the tax bill.
Further information about the appeals process may be obtained by contacting the Appeals Board at (916) 874-7894.
7. Why did I receive a supplemental bill to repay a supplemental refund I previously received?
Occasionally a supplemental event before yours is changed in the same assessment year due to an appeal or exclusion filing by the prior owner. This is not an error, however, if the previous assessed value changes, the net difference between the prior owner’s new assessment and your already processed assessment would also change. If a previously issued refund is no longer valid as a result of that change, a bill will be issued to recapture those funds. Example:
8. Will I still receive an annual tax bill in October?
Yes. The supplemental tax bill is sent in addition to the annual tax bill and both must be paid.
9. If I pay property taxes through an impound account (i.e., with my mortgage payment), will my lender get my supplemental tax bill?
No. Mortgage servicing agencies do not receive the supplemental tax bill. Supplemental bills are sent directly to the property owner. Only annual tax bills mailed in October are sent to lenders.
10. What happens if I resell a property shortly after I purchase it?
If you purchase and then resell property within a short period of time and the Assessor has not already issued a supplemental assessment for the date you first acquired the property, any supplemental tax bills will be prorated between you and the new owner. In that case, you would receive a tax bill that reflects only the actual time period you owned the property. The new owner would receive a separate supplemental tax bill reflecting the period of ownership from the date he or she acquired the property until the end of that fiscal year.
If the supplemental bill for your acquisition of the property is issued before a subsequent sale of the property, it is a valid bill and the county cannot prorate the bill between you and the new owner. Any proration of the supplemental bill you do receive then becomes a private matter to be resolved between buyer and seller.
11. How are supplemental taxes computed?
The formula for calculating a supplemental refund is shown below:
(Amount of Net Supplemental Assessment) x (Tax Rate) x (Monthly Factor)
The Amount of Net Supplemental Assessment is the new assessed value minus the prior assessed value minus any exemptions allowed.
The Tax Rate is 1% plus recapture factor for any voter-approved bonded indebtedness. Most tax rates in Sacramento County are between 1% and 1.20%.
The Monthly Factor represents the number of whole months remaining in the fiscal year after the month of the supplemental event. The chart below shows these factors.
Month (Factor)
January (.42)
February (.33)
March (.25)
April (.17)
May (.08)
June (1.00)
July (.92)
August (.83)
September (.75)
October (.67)
November (.58)
December (.50)
Additional information regarding tax rates and the computation of supplemental assessments may be viewed at the Auditor's Office website or Revenue & Taxation Code 75.41.
12. Why would an owner receive more than one supplemental tax bill?
There are three reasons why an owner may receive more than one supplemental tax bill:
A. The Supplemental Event Occurred between January 1 and May 31
A supplemental assessment is always generated for the fiscal year in which the event occurred.
An event occurring between January 1 and May 31 will generate a second supplemental assessment for the subsequent fiscal year affected.
The second bill is generated because the annual roll assessment created for the coming fiscal year does not reflect the change in value generated by that event, but must also to be adjusted to reflect the difference as well.
B. Prior Owner Had a Supplemental Event in the Same Fiscal Year
You can also receive multiple supplemental bills in situations where a series of supplemental events take place within the same fiscal year for different owners. If the bill for the prior owner’s supplemental event is for the same fiscal year in which you took ownership, you will receive a pro-rated portion of that bill for the time period you owned it.
C. Multiple Supplemental Events Occurred While You Owned the Property
If multiple supplemental events (changes in ownership and new construction) occurred while you own the property, you will receive one or two supplemental bills for each of these events. Supplemental assessments are generated for each assessment.
13. When must supplemental tax bills be paid?
Bill payment dates are printed on the tax bills. Penalties are added if payments are not made by these deadlines.
The date a supplemental tax bill becomes delinquent depends upon when the tax bill is mailed by the Tax Collector. If the bill is mailed between July 1 and October 31, it becomes delinquent on December 10 for the first installment, and on April 10 for the second installment (the same schedule as for the annual tax bill).
14. Can I make a partial payment if I can’t pay in full?
No. The full amount of each installment must be paid to the Tax Collector's Office. Partial payments will not be accepted.
15. Am I entitled to a Homeowners' Exemption on my supplemental tax bill?
You may be eligible to receive the Homeowners’ Exemption of up to $7000 of assessed value on a supplemental tax bill if the property you acquired was not already receiving the exemption on its annual roll bill and the property you acquired will be your principal place of residence.
A Homeowners’ Exemption is not granted automatically. You must submit a claim form to the Assessor for the Homeowners’ Exemption no later that the 30th day following the date of notice printed on Assessor’s Notice of Supplemental Assessment to receive a full exemption, or an exemption of 80% of the full amount will be granted if you file a claim form by the first installment due date.
To be eligible for the exemption you must occupy the home as your principal residence within 90 days of the purchase date or completed new construction for a newly built residence.
The Homeowners’ Exemption can only be applied to a supplemental assessment that is a net increase and results in a supplemental tax bill. It cannot be applied to a supplemental assessment lowering the value.
16. Are other exemptions available that might help lower my taxes?
Supplemental taxes are eligible for the same property tax exemptions and assistance programs as are annual tax bills. In addition to the Homeowners’ Exemption, you may apply to the Assessor's Office for other exemptions such as the Disabled Veterans, church, and welfare that may result in greater tax savings if you qualify. You must apply to the Assessor for these exemptions no later than the 30th day following the date of notice printed on the Assessor’s Notice of Supplemental Assessment. For further information regarding these other exemptions, contact the Assessor's Office Institutional Exemptions staff at (916) 875-0720.
17. What should I do if I have additional questions?
You may contact our Customer Service staff at (916) 875-0700, visit our office at 3701 Power Inn Road, Suite 3000 Sacramento, CA 95826-4329, or view our General Information index.
