The devastation caused by wildfires can leave homeowners grappling with significant challenges, from rebuilding their homes to managing unexpected financial burdens. Fortunately, for property owners in Los Angeles County who have suffered fire damage, relief options are available, including property tax deferrals. Here’s what you need to know to take advantage of these resources and ease the financial strain.
Eligibility for Property Tax Deferrals
If your property has sustained at least $10,000 in damage from recent wildfires—whether from flames, smoke, or water used in firefighting efforts—you may qualify for a property tax deferral. This program provides a crucial financial reprieve, allowing homeowners to delay tax payments without incurring penalties or interest.
To apply, homeowners must file a “Misfortune or Calamity” application with the Los Angeles County Assessor’s Office. According to L.A. County Assessor Jeff Prang, these forms are readily accessible online at assessor.lacounty.gov.
“We encourage everyone affected to submit these forms. If your home is damaged or destroyed, you shouldn’t be paying property taxes for a property that no longer exists in its prior state,” Prang emphasized.
Automatic Adjustments for Damaged Properties
In addition to the application process, the Assessor’s Office will proactively assess damage to properties in fire-affected areas once it is safe to do so. For homes that have been destroyed, assessments will automatically be reduced to reflect land value only, sparing homeowners from paying taxes on a structure that no longer exists.
Prang highlighted, “While taxes on the land remain, they can also be deferred. Lower assessments will remain in place until the home is repaired or rebuilt.”
Protecting Proposition 13 Benefits
Under California’s Proposition 13, property owners benefit from limits on annual property tax increases based on the original purchase price of their homes. Homeowners rebuilding after a fire can retain these lower assessments as long as the new structure is “substantially equivalent” to the original. However, any additional square footage or upgrades beyond the original specifications will be taxed at the current market rate.
Additional Tax Relief Opportunities
For homeowners who have already paid their property taxes, refunds may be available under specific circumstances. Those who pay taxes monthly through mortgage payments should still file a “Misfortune or Calamity” application to trigger reassessments and coordinate with their lender for potential adjustments.
This program isn’t limited to homes. Owners of personal property, such as mobile homes, boats, or planes, may also file for relief if damage exceeds $10,000.
Exploring Broader Assessment Reductions
In the aftermath of widespread fire damage, entire neighborhoods may experience a decline in property values. The Assessor’s Office is exploring options under Proposition 8, which allows for reductions in property assessments during economic downturns or natural disasters. However, state law currently limits these reductions to next year’s tax assessments unless special legislation is enacted.
How to Apply and What to Expect
- File a Misfortune or Calamity Application: Submit your application online or via mail to the Los Angeles County Assessor’s Office.
- Work with the Assessor’s Office: Officials will inspect the affected property and adjust assessments accordingly.
- Coordinate with Your Lender: If you pay taxes through your mortgage, notify your lender of the reassessment.
- Track Legislative Updates: Stay informed about potential state-level measures that may provide additional relief.
Conclusion: Rebuilding with Support
Losing a home to a wildfire is an overwhelming experience, but financial relief programs like property tax deferrals can provide critical support as you rebuild. By taking advantage of available resources and working with local authorities, you can ease the burden and focus on recovery.
Remember, help is available, and you are not alone in this process. Reach out to your community, stay informed, and take the steps necessary to protect your financial stability. Together, we can recover and rebuild stronger than before.