What is an “escape assessment”?

Sacramento County Assessment Appeals Board at 700 H StreetThere is no escaping property taxes, right?

According to the Sacramento County Assessor, “An “escape assessment” is a correction to a property’s assessed value on the local property tax roll. The correction is made because the Assessor’s Office discovered a property or a taxable event that should have been assessed but was not. Current and/or prior year tax rolls may be affected. The most common reasons for an escape assessment are overlooked or unreported new construction, a missed change of ownership… or the removal of an exemption.”

Why am I talking about escape assessments? I just finished up some property tax consulting work for an East Sacramento home owner who needed research for his property’s value over the past four years. I love this type of work because it’s exciting to analyze the market for a number of years to establish a value over time. In this situation the owner inherited the property in 2008 from a friend, but the Assessor’s Office was not informed at the time of the death of the original owner, which should have triggered a reassessment. When the Assessor discovered the death and change of ownership, they sent the new owner a “Notice of Proposed Escape Assessment”, which basically means the Assessor’s Office enrolled new assessments for the property for the past four years. The home owner can appeal the values within 60 days of the issuance of the notice. Since the owner disagreed with the value put on the tax roll by the Assessor for 2008-2011, he hired me to show what market value was during each of these respective years.

NOTE: In situations like this the owner can appeal property taxes for multiple years in the past, but that’s not the case in typical “decline in value” situations. If you have been overtaxed for the past several years, for example, but you did not formally dispute your property taxes at the time, then there is nothing you can do once the appeals deadline passes on November 30 of the given year. All you can do is wait until the next year to appeal your property taxes.

Does that make sense? Let me know if you have any questions.

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Comments

  1. F re d. Ghahyasi. says

    The proposed escape assessment was sent to the escrow office that had moved sincethe time we oppened the escrow. Consequently, we did not receive the notices the assessors office had sent out. Now, six month has passes and the assessor office sent us a delequant tax bill. I feel we do not owe the tax because we were not aware of the notices. This was a prop 58 case.
    Please help
    Fred G.
    Thanks

    • says

      Fred, I just came across this comment from quite a while ago. I’m so sorry to have missed this one. I’m not sure what happened as I am in the habit of responding to all comments. This sounds like an unfortunate issue, and my guess is the Assessor would not budge and accept less money due to the escrow company dropping the ball. However, it may be prudent to at least waive the delinquent charges. I wish you the best.

  2. says

    the increased amount in real property valuation over the regular assessed valuation from a delayed reappraisal of the property and/or an erroneously applied homeowner’s exemption valuation reduction. secured property supplemental tax bill retroactively taxes the supplemental assessment of property on a pro- rata basis as a result of the assessor’s reappraisal of property

  3. sandracreech says

    I just got an Escape Assessment (County of San Diego) owing to a “missed change in ownership” of my mobile home which closed 08/11/2011.

    The three years net totals in the $46,000 range don’t tell me how much more I might have to pay nor do I know where begin to research as to value then and now in hopes I do not owe them. Any ideas where I might start?

    • says

      Hi Sandra. Thanks for reaching out. I might recommend calling whoever sent you the letter to ask them for an explanation. I imagine it’s the Assessor in San Diego, and the phone number should be on the letterhead that was sent to you. You can always ask them how much the $46,000 in assessment is going to equal in payments, and they should be able to answer you. I know up here the tax rate is about $100-125 for every $10,000, so $46,000 would equal about $500-600 out of pocket. Let me know if you have any questions.

  4. Dave says

    My Ex and I had a home together, when we split up I bought her out and took her off the title of the home. Now my City hit me with almost a $700 Escaped Assessment. I find this ridiculous as all I did was remove her from the title. The City says I gained 50% more of the property, but how do they know what percentage I had in this property anyway? I could have already been writing off 99% of it and only gained 1% by removing my Ex’s name from title.

    • says

      Dave, I’m sorry to hear about your situation. If I were in your shoes I would feel exactly the same. First off, below is what the tax code says about a change of ownership. I thought this would be a definitive way to show they are possibly giving you a new assessment because of a change in the interest of the ownership of the property. Usually a refinance does not trigger a new assessment, but maybe if you removed her from title as a part of the refi, that triggered it. I’m not certain on that point. It sounds like you can go round and round and parse whether you had 50% or 1% of the ownership, but it would seem if you are now the sole owner, they are looking at the situation as if you now own 100% of the property. The big key here is they are assessing you as the 100% owner of the property based on a certain date. From a property tax standpoint, you can look back at that date and then dispute the assessment if it seems too high. Of course the bigger issue is that this is an issue in the first place. I’m sure you’ve already reached out to the Assessor to explain your situation. I might encourage you to ask them for documentation to support that removing your ex-wife is a change of ownership. Just be sure they know your situation, and that your situation fits the language of what they are saying. I wish there was something I could do to help, but it sounds like a change of ownership based on the paragraph below. I hope I’m wrong, and I hope you can find a loophole. If you do, please comment back. If there ends up being something I can do, I am around. Best wishes Dave. I saw your other comment too about a lower interest rate. Congrats on that.

      “Rule 462.001. Change in Ownership—General. Reference: Sections 60–67, Revenue and Taxation Code.

      A “change in ownership” in real property occurs when there is a transfer of a present interest in the property, including the transfer of the right to beneficial use thereof, the value of which is substantially equal to the value of the fee interest. Every transfer of property qualified as a “change in ownership” shall be so regarded whether the transfer is voluntary, involuntary, by operation of law, by grant, gift, devise, inheritance, trust, contract of sale, addition or deletion of an owner, property settlement, or any other means. A change in the name of an owner of property not involving a change in the right to beneficial use is excluded from the term “transfer” as used in this section.”

      This code came from the following link:
      http://www.boe.ca.gov/lawguides/property/current/ptlg/rule/462-001.html

  5. Annie G says

    My parents, who are both still alive, apparently have owned a property since 1974. I found the original deed and it doesn’t look like anything was ever recorded. I think they’ve been paying property taxes all this time?? But if they were to finally record the deed now, will there be any escape assessment? And does the fact that they got this property prior to prop 13 passing affect anything?

    • says

      Hi Annie. That’s an interesting situation. It almost seems like it would have had to record in order to pay property taxes, but who knows. It’s hard to say if there would be any back-taxes due, but I will say if taxes were not paid, the government is a big fan of collecting money. I think the beginning point for you may be calling the Assessor to ask general questions without identifying the particular property. Have you checked Tax Records to see if they are on title? That may also prove helpful. You are welcome to send me an email with the property address or parcel number, and I can tell you who is on title (as long as the property is located in California).

  6. Annie G says

    Hi Thanks for your reply! I called in to the recorders office with the property info and they confirmed that it’s my parents’ friends (they’re the ones who gave the parents the property) who are still on the deed. I think the agreement was that my parents could have the property as long as they would keep paying the property taxes, but I think the bills were still addressed to their friends. I think they kept up with paying the taxes. My parents can just record the deed to make it official? Or will they be hit with all these supplemental and escape taxes??

    • says

      That’s a tricky situation, Annie. I’m honestly not sure what will be done since that’s outside of the scope of what I do. Theoretically if someone is on title and has not paid taxes, they will owe for those taxes. However, if your parents are not on title, I’m not sure how that is going to play. I know about escape assessments as a valuation professional. This sounds like something more specific that should best be answered by an Assessor, attorney, the California Board of Equalization (who has some great Q&As online), and maybe even a conversation between your parents and their friends is in order. I wish I had a quick answer for you.

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