After buying a home, the last thing a buyer wants is a surprise bill. So when the supplemental tax bill arrives in the mail in 6-12 months after closing, hopefully it is not a surprise. While reviewing the disclosures about the home, an experienced agent understands the important of disclosing the Supplemental Tax Bill. When I mention the supplemental tax, new buyers already in disclosure input overload give me a puzzled look. "What the Heck is that?" When I begin to explain the complicated tax, some people get a glazed look in their eyes and even tune out until they hear it may be a few hundred or few thousand dollars. That always seems to catch their attention. Then I begin to repeat what the tax is all about, with their full attention.
The San Diego County Treasurer-Tax collector's office has an excellent video explaining the Supplemental Tax.
When you buy a house, you normally buy it at higher price than the seller did. The price that the seller bought the house at is the base price that property taxes are calculated for in escrow. So part of the closing costs, are the buyer's prorated portion of the property taxes, again based on what the seller paid for the property.
Once the home closes, then the tax assessor reevaluates the taxes based at the higher value. So the supplemental taxes can vary depending on what the difference in the price is. If the seller owned the home for 30 years, then there can be a big difference in the original versus the new value, creating a large supplemental tax. Where if the seller bought it only a few years ago, there may not be much difference at all. The San Diego Tax Assessor's office has an online supplemental tax calculator that a buyer can access online to calculate what the difference due should be.
Since Loan impound accounts do not include money to cover Supplemental Tax Bills, it is important to be prepared, and save some money to cover it. Don't be surprised by your Supplemental Tax Bill.
For other Buyers information, go to the Buyers tab at VirginiaHall.com.
Written By Virginia Hall
DRE License #01409760
San Diego East FootHills
Keller Williams Realty
619-258-8585
