The supplemental taxes are determined in accordance with Article XIIIA of the California Constitution which generally requires reassessment of property (for property tax purposes) whenever a change in ownership occurs or new construction is completed. New construction is any substantial addition to real property (e.g., adding a new room, pool, or garage) or any substantial alteration which restores a building, room, or other improvement to the equivalent of new (e.g., completely renovating an outdated kitchen).
The Assessor first determines the new value of the property based on current market values. The Assessor then calculates the difference between the new value set at the time of purchase or completion of new construction and the old value set on the January
1 lien date. This results in the supplemental assessment value. Once the new assessed value of your property has been determined; the Assessor will send you a notification of the amount. To calculate your supplemental tax bill, subtract your home’s
old value from the new market value based on the reassessment. You are taxed on that difference. The Auditor will prorate what you owe based on the number of months left in the fiscal year. Finally, the 1% tax rate is applied to that amount to determine
your supplemental tax total. To estimate your supplemental taxes please use the supplemental taxes estimator.
Supplemental tax bills are not mailed to lending agencies. Supplemental tax bills are mailed only to the property owner. If you have arranged for your tax payments to be paid through an impound account, the supplemental tax bill may not be paid by your lender. You should contact your lender regarding payment of supplemental tax bills in addition to your annual property tax bill. Make sure your lender is aware you are referring to a supplemental tax bill. It is the property owner’s responsibility to make arrangements with their lender to pay the tax bill prior to the delinquent date.
The supplemental tax is due upon the mailing of the tax bill. A supplemental tax bill becomes delinquent the last day of the month following the month in which the bill was mailed. If the taxes are to be paid in two installments the second installment becomes delinquent four months following the delinquent date of the first installment. If the last day of the month falls on a weekend or holiday the bill is delinquent after the next business day. While the reassessment process normally takes six to nine months, in some cases it may take a year or even longer before a supplemental tax bill is issued. The supplemental tax bill(s) is (are) in addition to your annual property tax bill. A reassessment may result in one or more supplemental tax bills being mailed to the property owner.
The same laws apply as for unpaid annual tax bills. If your supplemental tax bill is not paid by June 30 after which the second installment became delinquent, the property becomes tax-defaulted and accrue interest at a rate of 1.5% per month (18% per year) that they remain unpaid. At the end of the fifth year of delinquency, the property becomes subject to the Tax Collector’s power to sell and will be taken to auction for payment of taxes.
Sale or transfer of the property does not relieve the assessed owner of responsibility for this tax bill. In some cases, a property changes ownership before a supplemental bill is issued for a prior change of ownership or completion of new construction. This will occur if you purchase and then sell property within a short period of time. In these cases, the bill for the prior activity is prorated between the prior owner and the current owner based on the number of days each owner owned the property in the period between the first activity and the end of the tax year June 30. This may result in more supplemental tax bills being issued to you.
Supplemental tax bills are identified as either secured or unsecured. Those identified as secured are liens on the property, those identified as unsecured are billed to the name assessed and, if unpaid, will result in recordation of a personal tax lien.