California’s property tax system can be confusing—especially with layers of laws like Proposition 13, Proposition 8, and complex rules around reassessments. Whether you’re a homeowner, investor, or commercial property owner, understanding how property taxes are calculated—and how to appeal them—can save you thousands of dollars.

What Is the Base Property Tax Rate in California?

Under Proposition 13, property taxes in California are generally capped at 1% of a property’s assessed value. This does not include additional voter-approved local taxes and assessments, which can raise the effective rate to anywhere from 1.1% to 1.25% depending on your county and district.

👉 Example: If your assessed value is $1,000,000, your base tax bill would be $10,000.
Additional taxes (e.g., school bonds, local measures) could add $1,000 to $2,500 on top of that.

Assessed Value vs. Market Value

One of the biggest misconceptions is that your property tax bill is based on market value. It’s not.

• Assessed Value: Determined at the time of purchase and capped at 2% growth per year unless a reassessment is triggered

• Market Value: What your property would sell for today

In booming markets, the assessed value may lag far behind the true market value, which is good for long-term owners—but can lead to reassessments for new buyers.

When Does Reassessment Happen?

The county Assessor’s Office will reassess your property when:

• You purchase a property

• You complete new construction

• There is a change in ownership (including LLC/partnership changes in commercial deals)

• There’s a long-term lease (35+ years) transfer

📌 Note: California’s Proposition 19 now limits some reassessment exclusions previously available under Props 58 and 193 for parent-child transfers.

Temporary Reductions: Understanding Proposition 8

If your property’s market value drops below its assessed value, you may qualify for a temporary reduction under Proposition 8.

This is common during market downturns, natural disasters, or high vacancy in commercial properties. Filing a Prop 8 appeal can lead to significant short-term tax savings.

Supplemental Assessments: What They Are & Why They Matter

When you buy a property or make improvements, the county may issue a supplemental assessment bill. This reflects the difference between the old and new assessed values from the date of your transaction through the end of the fiscal year (June 30).

You’ll receive this separately from your regular tax bill—and it often catches new owners by surprise.

We help property owners review and reduce their supplemental assessments →

Special Assessments and Parcel Taxes

Beyond general property taxes, your bill may include:

• Parcel taxes for schools, infrastructure, or fire protection

• Mello-Roos assessments for newer developments

• Bond measures approved by voters

These assessments are based on your property or parcel—not its value—and can be challenged if misapplied.

How to Appeal Your Property Taxes

If you believe your property is overassessed, you have the right to file an appeal with your County Assessment Appeals Board. The deadline is typically September 15 or November 30, depending on the county.

Here’s what’s needed:

1. Your property's Assessor’s Parcel Number (APN)

2. Comparable sales or income data

3. A completed Application for Changed Assessment

📌 Pro tip: Many successful appeals involve hiring an expert who understands the nuances of valuation, legal rules, and deadlines.

Start a no-cost review with our expert appeal team →

Final Thoughts: Don’t Overpay on Property Taxes

California’s property tax system is structured to provide stability, but it’s not always fair—especially if you’ve recently purchased a property, completed construction, or own commercial real estate. By understanding how your bill is calculated and knowing your rights, you can make informed decisions and avoid overpaying.

Need help navigating your next appeal? Our team at Paramount Property Tax Appeal has helped clients save millions of dollars in overassessed taxes. We work on a contingency basis, so you only pay if we reduce your taxes.