|
Question: I bought a home in September and am aware that I will be responsible for property taxes twice a year based on my purchase price. Well, I was shocked to receive a Supplemental Tax Bill several weeks ago.I thought the tax was already paid up through December in escrow. Why do I have to pay this extra tax?
Answer: You are not the only buyer who has been "shocked" to receive a Supplemental Tax Bill. Assembly Bill 459 was approved for this very reason. Effective January 1, 2006, when writing a purchase agreement a disclosure form (SPT), "Notice of Your "Supplemental´ Property Tax Bill", is required to make buyers of real estate aware that they are likely to receive a supplemental tax bill after the close of escrow.
You already know that property taxes are due twice a year. The first half, for the period July 1st to December 31st, is due on November 1st and delinquent on December 10th. The second half, for the period January 1st to June 30th, is due February 1st and delinquent on April 10th. You closed escrow in September and, you´re right, the tax is paid up through December 31st. But, it is the seller who paid it at the former rate. You´ve owned the property from September through the end of December without being charged at the reassessed rate based on your purchase price. The purpose of the supplemental tax bill is to reflect the difference between the previous assessed rate and the new reassessed rate. You will receive your first regular property tax bill for the period January 1st through June 30th.
The supplemental tax is a one time tax that covers the time from the date of ownership or the date of completion of new construction to the end of the tax year which is June 30th. You may remit the total in one payment or make two installments. If you choose the installment plan and since you received your bill within the months of November through June, the first installment will become delinquent on the last day of the month following the month in which the bill is mailed. The second installment will become delinquent on the last day of the fourth calendar month following the date the first installment is delinquent. You could receive two bills if you purchased your property between January 1st and June 30th.
The new disclosure notes that the bill will not be sent to your lender. This notification is very important to buyers who have their tax payments impounded. All supplemental tax bills must be paid directly to the Tax collector. The disclosure also should make buyers aware that they may need to have extra cash on hand.
|