Decline in Value Frequently Asked Questions
- What is a Temporary Decline in Value?
Revenue and Taxation Code Section 51 requires the assessor to enroll either a property’s Factored-Base-Year Value (established under Proposition 13) or its market value as of the lien date.
This reduction is temporary and the assessor is required to review the market value of the property each lien date after the reduction until such time as the Factored-Base-Year Value is less than or equal to the market value.
When the Factored-Base-Year Value is again enrolled, the property is no longer subject to the annual review, and will receive indexing not to exceed 2% per year.
- Do properties other than single-family residences qualify?
Yes, all real property qualifies.
- How can the assessed value of my property be increased after you reduced it?
The assessor is required to review and increase the value to market or the Factored-Base-Year Value as of each lien date following the initial reduction.
Just as there is no limit on the amount of reduction, there is no limit to the amount being restored to the Factored-Base-Year Value.
- Is the Assessor required to restore my protected Proposition 13 value even if it’s more than a 2% increase?
Yes, just as there is no limit to the amount of reduction when arriving at market value, there is no limit to the amount being restored when market value increases, up to the factored Proposition 13 base year amount.
- If I have been granted a reduction for the current year will I have to request another review next year?
No, once you have been granted a reduction pursuant to Proposition 8 your next year's value will automatically be reviewed. A Notification of Assessed Value will be sent to you in July, which will indicate our findings.
- What should I do if I disagree with the Proposition 8 value placed on my property?
If after review of the Notification of Assessed Value card you disagree with the value, you have until September 15 of that year in which to file an Application for Changed Assessment with the Assessment Appeals Board.
- Why isn't the reduction under Proposition 8 permanent?
Proposition 8 (now California State Revenue and Taxation Code Section 51) requires the Assessor to compare each property's Factored-Base-Year value with the current market value, and enroll the lesser of the two each year.
- What if after having been given a reduction, my value continues to decline?
Once a property value has been lowered for Proposition 8, your next year’s assessed value will be automatically reviewed. The lower of current market value and Factored-Base-Year Value will be enrolled.
- What will happen to my assessment if values start to rise?
Your taxable value reduction to market value is temporary and the assessor is required to review the market value of the property each lien date after the reduction, until such time as the Factored-Base-Year Value is less than or equal to the market value.
Unless there is a change in ownership or new construction, this increase in value cannot exceed the original assessed value plus the annual inflationary factor not to exceed 2 Percent per year.
- My land value looks alright, but my structure value looks high. Can I just have my structure value lowered?
No, the total property value must be considered. Only total assessed value can be compared.
The lower of total property current market value and total property assessed value is enrolled.
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