Are you a resident of California affected by the recent fires? There have been emergency proclamations in the counties of Santa Barbara, San Diego, Los Angeles, and Ventura. The state of emergency has caused building owners to ask about whether property taxes need to be paid if a building is burned down. Thankfully, the answer to that question is no.
Revenue and Taxation Code section 170 says that if a fire occurs (or an earthquake or flooding) and causes damage, you are eligible for property tax relief if your county has an ordinance that allows it. The good news is that every county in California, except Fresno, has adopted an ordinance for disaster relief. Property tax relief applies to owners of real property, business equipment and fixtures, orchards or other agricultural groves, and to owners of aircraft, boats, and certain mobile homes. The property taxes will be reduced for whatever portion of the property that is damaged or destroyed.
In order to qualify for property tax relief, you must file a claim with your county assessor within the time specified in your county ordinance, or 12 months from the date of damage or destruction, whichever is later. The loss estimate must be at least $10,000 of current market value in order to qualify. You can find the form for reassessment for property damaged or destroyed on your county’s website. They will instruct you on the steps afterwards.
Now you may wonder in the case that your house was destroyed in a Governor-labeled disaster, “Can I buy another house in the same county or a different county and transfer the base year value of my damaged house to a new house?” You may for whatever reason not want to rebuild in the same location and are wondering if you can go elsewhere. The answer to this question is yes. First, Section 69 declares that if 50% of your house’s full cash value immediately prior to the disaster was destroyed, then you are eligible to find another location in your same county. The new property must be a comparable replacement property in size, utility, and function, and it must not exceed 120% of the full cash value of the destroyed property. Regarding a different county, you are only able to do so if the different county has adopted an ordinance that allows such taxable value transfers. The ten counties that have adopted such an ordinance include: Contra Costa, Los Angeles, Modoc, Orange, San Francisco, Santa Clara, Solano, Sonoma, Sutter, and Ventura. There are further qualifications that must be met with regards to transferring to another county which can be found in section 69.3.
For more information regarding property tax relief from disasters, please click here.
