Monday, January 29, 2007

Understanding Prop 13

Prop 13 was passed in 1978 as a way of reducing property taxes. Now, according to the amended state constitution, property tax rates could not exceed 1 percent of the property's market value and valuations couldn't grow by more than 2% per annum unless the property was sold.

Features of Prop 13


  • One percent rate cap. Prop 13 capped, with limited exceptions, property tax rates at once percent of full cash value at the time of acquisition.

  • Assessment rollback. Prop 13 rolled back property values for tax purposes to their 1975-76 level.

  • Responsibility for allocating property tax transferred to the state. Prop 13 gave lawmakers responsibility for allocating property tax revenues among local jurisdictions.

  • Reassessment upon change of ownership. Prop 13 replaced the practice of annually reassessing property at full cash value with a system based on price at acquisition.

  • Vote requirement for state taxes. Prop 13 requires any measure enacted for the purpose of increasing state revenues to be approved by 2/3 vote of each house of the legislature.

  • Voter approval for local "special" taxes. Prop 13 requires taxes raised by local governments for a designated or special purpose to be approved by 2/3 of the voters.

Search the MLS for Ventura County Real Estate at:

www.HopeGoss.com

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