Every week, Mansion Global poses a tax question to real estate tax attorneys. Here is this week’s question.
Q. I'm looking at a property purchase in Lake Tahoe. What are the differences in property taxes on each side of the lake?
A. Property taxes on the Nevada side of Lake Tahoe are significantly less expensive than those in California.
More: Which U.S. States Charge Property Taxes for Cars?
Although each county is different, Nevada as a whole has the fifth lowest property taxes in the U.S., according to ATTOM Data Solutions, a California-based data company. The state’s effective tax rate is 0.58%, and homeowners paid an average of $2,138 in taxes in 2018, according to ATTOM’s most recent report.
There, a property is assessed at “35% of its full cash value,” according to the Douglas County Assessor’s Office. That means that a home worth $2 million has an assessed value of $700,000.
In addition, there is a 3% cap on the amount property taxes can be raised on primary residences each year, according to the state. For second homes, that cap is a maximum of 8%.
Across the border in California, homes are assessed at market value at the time of purchase, according to attorney Sophia Y. Cizmarik of the California-based firm Weintraub Tobin.
In short, that $2 million home will be assessed at $2 million. Because of the state’s Proposition 13, the assessment can only be increased 2% a year, but new homeowners in California will certainly see a bigger bill than their neighbors.
California homeowners paid an average of $5,387 in property taxes in 2018, with an effective tax rate of 0.75%, according to ATTOM.
Email your questions to editors@mansionglobal.com. Check for answers weekly at www.mansionglobal.com.
Click to Read Tax Experts Share Answers and Advice for Readers’ Pressing Tax Questions