I wanted to stop by and answer a question that a client of mine asked last week. She was charged with a supplemental property tax and was a little confused about why. She was under the impression that she had already taken care of her property taxes for this year. Here’s a little clarity on this complex issue.
Property tax bills come in two sessions. One is for the first six months of the year, and the other is for the next six months of the year. The fiscal year for county assessors begins on July 1st, so we can get into some tricky situations because of that.
Let’s say you closed escrow on September 1st. You’re about halfway through that first billing cycle. You’re going to have to pay back the seller for the portion of taxes that they paid from the date you closed escrow until the end of the billing period. That will be paid right out of escrow.
Sometimes, you pay your first bill for your current home and then buy a second one that’s worth $100,000 more. In that situation, you will be taxed for that $100,000 difference at about 1.25% and that will be just for the one billing cycle. When the next cycle comes around, you probably won’t have a supplemental tax bill. It’s pretty much a one time thing when you buy a new home.
The easy way to remember when that tax bills come is with the phrase “No Darn Fooling Around.” Your first bill comes out in November, and it’s delinquent in December. Your second bill comes out in February, and is delinquent in April. Remember those things.
If you have any other questions or want more information about buying or selling a home, give us a call or send us an email. We would love to hear from you.