Based on an estimated gap between the assessed values and market values of California’s residential properties, Zillow and CALMatters, a nonprofit journalism venture in Sacramento, have determined that the state’s tax limits and exemptions have saved Californians roughly $30 billion in property taxes this year.
The biggest of these exemptions is Proposition 13, which was enacted in 1978. Under Prop 13, property taxes cannot increase above a certain level in a year unless a house is sold, at which point the property tax base resets at current market rates. This means that the tax-assessed value of a California home is often far lower than market values, which encourages owners to hold on to tax-advantaged homes instead of selling them. California also has tax caps for special groups, including disabled veterans and low-income seniors.
Los Angeles County taxpayers saved $7.4 billion this year, the largest total among the 40 California counties for which we were able to secure sufficient data for our analysis. L.A. was followed by Santa Clara County ($3.4 billion), Orange County ($2.5 billion), Alameda County ($2.4 billion), and San Diego County ($2.2 billion).
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