Governor Newsom Announces Property Tax Relief Order
May 8, 2020
While certain CA counties had already announced property tax deadline extensions – including San Mateo and San Francisco counties – Governor Newsom offered further relief this week when he announced an executive order waiving the 10% penalty, and other fees associated with late property tax payments, through May 2021 (for homeowners who demonstrate they have experienced financial hardship due to the COVID-19 pandemic). This is welcome news for property owners who have been hit by job cuts during this coronavirus outbreak, for whom a deadline extension of a couple weeks is simply not sufficient.
Property owners should be aware that this isn’t a blanket order that applies to all property – there are some key caveats. One such being that it only applies to a homeowner’s primary residence – not to any rental properties. Also, homeowners whose lenders have established impound accounts to collect the property taxes on a monthly basis won’t be able to apply for a waiver since the mortgage company makes the payment to the county tax collector.
Some small businesses who operate a businesses in the building they own may be able to qualify for the waiver of penalties and fees as well.
There is no doubt that this penalty waiver will serve as a life raft for many homeowners who are struggling during this shelter-in-place, but it is important to note that these payments do represent a vital source of revenue for local governments – providing funds for public schools, cities, county agencies, county hospitals, special districts, firefighters, and police and more. Still, Governor Newsom says he discussed solutions with county assessors, and felt this was best option. Newsom said he spoke with county assessors to discuss ways to ease the burden on property owners hard-hit by the coronavirus without significantly harming the public agencies that need those funds:
We were working with the counties to see if we could coordinate and collaborate in a way that can address the hardship claims that were coming in and allow people to get on payment plans without experiencing that rather sizable 10 percent tax code penalty that is assessed on those property tax bills.
If you have any questions about how this affects you and your property tax payments, give us a call – we’re happy to help any way we can! (650) 363-2808