Taking a Closer Look at Property Tax Records in San Francisco
The city of San Francisco is the central city in Northern California, where the culture, business, and tourism are heavily concentrated. It draws visitors from all over the world because of its beautiful seaside scenery, historic landmarks, thriving technology sector, top-notch culinary scene, and impressive real estate market.
One thing to know about San Francisco if you are planning to buy a property in the area for settlement or investment is the city’s property tax system. San Francisco property taxes are essential to supporting the area’s public services and infrastructure and have a considerable impact on residents’ monthly budgets. As a responsible property owner and taxpayer, keeping track of your San Francisco property tax records may benefit you in the long run.
In this article, we’ll help you familiarize yourself with San Francisco’s property taxes, the importance of property tax records, how to calculate your property tax, and the exemptions you may apply for.
The first thing you should understand is that San Francisco property tax records provide a detailed account of past tax payments, including the dates and amounts paid. The information allows property owners to ensure they comply with tax obligations and avoid any potential problems.
Let’s get started so you may confidently organize your finances, navigate the city’s property tax, and become a responsible homeowner.
The Importance of Keeping Track of Your San Francisco Property Tax Records
One importance of property tax record-keeping is being able to track when your next property tax payment is, so you have a time window to prepare for your payment and be able to pay on time. Here are other reasons why property tax records are essential to both the government and the property taxpayer:
- Taxpayers may utilize records to keep track of their expenses and whether they are eligible for a tax exemption or deduction. They may also find credits or deductions that they were previously unaware of. Some exemptions will be mentioned in this article, so read further.
- The records may show the sources of income and help differentiate commercial from nonbusiness income and taxable from nontaxable money. Residential and commercial taxes may vary.
- Tax returns can be prepared more quickly and with less stress if the taxpayer keeps meticulous records in case their return is audited or they receive an IRS notification.
- Taxpayers can save time and effort by keeping meticulous records. It will be easier to prepare their taxes if they keep all of their tax documents in one place and add to them throughout the year.
The IRS recommends that taxpayers preserve records for three years after the date the return was filed. Keeping a well-organized tracking and record-keeping of your San Francisco property tax records will save you a lot of time and resources in the long run or even in unforeseen circumstances (which we are trying to avoid, so organize your records now!).
Navigating Property Tax Records in San Francisco
When you access the records of your property tax, you are going to run into a variety of acronyms and unfamiliar terms. It is essential to have a solid grasp of what each of these terms means to avoid getting confused and to have a well-organized property tax record for your convenience. Here is a quick overview of some terms you will surely encounter:
- Tax rate – the percentage by which property taxes are calculated.
- Assessed value – the value assigned to your home for tax purposes
- Taxable value – the value or portion of your home’s assessed value that is subjected to tax
- Taxable amount – the amount of tax due, calculated using the tax rate and assessed value
San Francisco’s Procedures for Assessing Real Estate Properties
Property ownership comes with various responsibilities, one of which is paying property taxes.
Assessing a property’s value for taxation is what’s known as “property tax assessment.” The estimated value is determined by the San Francisco Tax Assessor, who takes into account factors like recent property sales and any applicable exemptions. A new property assessment must be done whenever there is a change in ownership, or a new building is constructed.
Property Tax Exemptions
If you are trying to cut taxes, applying for a valid exemption can typically reduce the assessed value of a property. Exemptions usually come from local governments or tax authorities and are meant to help those in need or give qualifying property owners a leg up. Here are the exemptions that you may be eligible for:
- Disabled Veterans’ Exemption
- Homeowner’s Exemption
- Non-Profit Welfare Exemption
- Church Exemption
- Fishing Exemption
Disabled Veterans’ Exemption
Veterans who are wholly or partially incapacitated may be eligible for a tax exemption of up to $161,083. Their surviving wives who did not remarry are also eligible.
- Residents of California as of January 1 of the application year.
- Disabled or sick veterans of the United States Armed Forces who are unable to work are eligible for this program.
- If the 100% disabled veteran’s household income is less than $72,335, they may qualify for a $241,627 exemption.
If you own your home and use it as your primary place of residence, you can reduce the amount of money you pay in property taxes by around $70 to $80 per year. If you satisfy the requirements, you may be eligible to have up to $7,000 subtracted from the assessed worth of your home, which will result in lower property tax bills. Properties which are rental, vacation, or secondary are not eligible.
- Those interested must be the legal owner(s) or named purchaser(s) of the property.
- As of January 1st of each year, the property must serve as the primary residence.
- If you file your tax return by 5 p.m. on February 15 and you live in the home on January 1, you are eligible for the full exemption.
- If the claim is made between February 16 and December 10 at 5 p.m., it will be eligible for 80% of the exemption.
- Supplementary assessment is possible for homeowner exemption.
Non-Profit Welfare Exemption
Both real estate and personal property might qualify for the Non-Profit Exemption, a particular category of exemption. Only organizations that are not for profit, such as those created for religious, scientific, medical, or humanitarian purposes, qualify.
Complete the following steps to apply:
- Send in your request for a Certificate of Organizational Clearance from the California Board of Equalization.
- A separate claim must be filed with the county assessor in the county where the property is located.
According to Article XIII of the California Constitution and Section 206 of the Revenue and Taxation Code, facilities owned, leased, or rented by religious organizations that are used exclusively for religious worship services qualify for the Church Exemption. Churches must submit requests for church exemptions to the Assessor every year by February 15th in order to maintain their full exemption status. The exemption does not apply to any parts of the church building that are used for either residential or for purposes other than worship.
A church and the owner of the leased property can file a BOE-263 Lessors Claim. Filing the claim may help in reducing the property tax of the church.
Because of the Fishing Exemption, owners of Commercial Fishing Boats can enjoy a large decrease in the amount of their property tax that they have to pay—96% to be exact.
- The Affidavit of 4% Assessment of Certain Vessels (Form BOE 576-E) is the document that needs to be submitted to the Assessor-Recorder’s Business Personal Property Division. The submission of this form must be completed before the 15th of February.
- If you send in the form between the 16th of February and the 1st of August, you will still be eligible for a reduced assessment; however, it will be at a rate of only 80%.
Property Tax Rate and Property Tax Bill Calculation
The formula for calculating property taxes in San Francisco is as follows:
Property Taxes = (1% of Assessed Value + Voter-Approved Bonds + Fixed-Charge Special Assessments) – Tax Exemptions.
A single-family home in San Francisco, for instance, has a $850,000 assessed value, $460 in voter-approved bonds, $250 in fixed-charge special assessments, and a $500 tax exemption.
The 1% of $850,000 is $8,500. Now that we have the 1% of the assessed value, we’ll add it with the $460 voter-approved bonds and $250 fixed-charge special assessments. The sum is $9,210 ($8500+ $460+ $250). Then we subtract the exemption of $500, we’ll get $8,710.
The total tax bill then is $8,710.
The County Assessor considers the property’s market value, property improvements, and any applicable exemptions when establishing the property’s assessed value.
The San Francisco property tax rate is identical to the statewide average of 1% of assessed value. Under Proposition 13, however, a property’s assessed value is set at the time of purchase and, assuming no new assessment is required, can increase by no more than 2% per year or the rate of inflation.
To illustrate, a change in property ownership results in a new assessment, which might lead to much higher property taxes than the ones already paid. Long-term homeowners typically pay less in taxes because their property’s assessed value can only go up by a maximum of 2% per year. Inflation, or the pace at which property prices have risen over the past year, is represented by this variable.
As a homebuyer, owner, or consumer, expect that every year’s inflation rate is different. The government makes use of the inflation factor to reassess properties to make sure that taxes are aligned with the accurate market value. Meanwhile, the Office of the Assessor-Recorder establishes the assessed value of all taxable property each year. For Fiscal Year 2023-24, the secured property tax rate in San Francisco is 1.17769382%, as listed on the website of the City and County Treasurer and Tax Collector.
As for unsecured property taxes, in Fiscal Year 2023/24, the tax rate is 1.17973782%. Taxes on commercial, personal property (including owned or leased office equipment), boats and berths, and possessory interests in the use of space are all examples of unsecured property.
How To Pay Your Property Tax
All county residents should receive their property tax bills by November 1, as stated in the San Francisco Property Tax Timeline. Two payments are required, the first due on December 10 and the second due on April 10. If the payments are not received after 5 p.m. on the respective deadline dates, they will be considered delinquent. Failure to pay your property taxes by the due date will cause you to be subject to a 10% penalty on the total amount owed, plus an extra $45 in late fees for the second installment. Once tax defaulted (June 30), additional penalties, including a 1.5% monthly charge and a redemption fee, will be assessed to the owner if the San Francisco property taxes are not paid by this date.
As a responsible homeowner, you can pay through various ways:
- At the City Hall – The city hall is open from Monday to Friday, 8:00 a.m. to 5:00 p.m.
- Online – By providing your bank account information, you can make a free online payment via electronic check (eCheck). In contrast, debit and credit card payments incur processing fees. If you’d like to make an online payment, you can do so at the San Francisco Treasurer and Tax Collector’s website: Home | Treasurer & Tax Collector (sftreasurer.org)
- ACH or Wire Transfer Payment – The following information should be given to your bank in order to initiate an ACH or Wire Transfer to the account of the City and County of San Francisco.
- General Bank Reference Address: JPMorgan Chase, New York, NY 10017
- ABA/Routing Number: ACH: 028000024
SWIFT code: CHASUS33
- Bank Account Number: 20000043472203
- Bank Account Name: City and County of San Francisco
- For: Property Tax (TTX)
Via Mail – You can also submit a money order or check made out to the “SF Tax Collector.” Remember, a payment is considered late once it gets delivered after the due date, regardless of when the payment was mailed.
Homeowners and purchasers in San Francisco must have a firm grasp on property tax assessment, payment procedures, and property tax records to have a clear understanding of their responsibility as residents and property owners. Knowing how this tax system works will ensure that you pay the right amount and predetermine what your property tax would be to be financially ready. Investments can be protected, and long-term financial gains can be made if we keep a proactive and well-informed mindset.
If you want to have a deeper understanding and mastery of the San Francisco property tax system, please do not hesitate to reach out to us at your most convenient time. We’ll guide you on the right track and help you with your concerns. Click this link for more reliable information: https://teamtapper.com/blog/san-francisco-tax-decoding/.