How much will property taxes be on my Tahoe Second Home?

Working with second home Tahoe Buyers I get a number of questions from them. One of the most common questions I am asked is:

“How much will property taxes be on my Tahoe Second Home?”

While I am not an accountant, or tax professional (full disclosure here), for general planning and budgeting purposes, in the greater Tahoe City – Truckee, California areas (Placer County, Nevada County and El Dorado County), a buyer can generally expect their first year of property taxes to be approximately 1.25% of the purchase price.

Some agents go a little higher, some a little lower, but I have found that for planning purposes, using 1.25% of the initial purchase price is a reasonable number for our area for your first year. The tax breakdown is as follows:

1% of the real estate purchase price (California Proposition 13)

Add an additional 0.25% for additional tax payer approved measures such as education, fire, and other local public programs, for a total of 1.25% of the purchase price.

How much will property taxes be on my Tahoe Second Home?

A Tahoe Real Estate Example:

Purchase price of the Tahoe cabin is $500,000

Property taxes for the first year should be about $6,250, or 1.25% of $500,000 as an estimate.

California Prop 13 does allow for the underlying property value to be increased by 2% each year. What that means to you as a new Tahoe home owner is after your first year, and every year thereafter, a Tahoe property owner could see the base value of the property increase, which means the total tax bill will also increase for the following years of ownership.

For example, with our $500,000 Tahoe property purchase example, after year one, the second year of ownership could become $510,000 (2% increase in the base value of $500,000).

That means the property tax bill would also increase as 1.25% of $510,000, would be $6,375, which would be an increase in total property taxes due.

The following years could follow a similar formula. An increase in the property tax over the first year due to the escalation property value clause is also something a California Tahoe Buyer should plan for.

Supplemental Tax Bill If the Tahoe real estate you are buying currently has a lower tax basis than the purchase price you are paying, you’ll get a “supplemental tax bill” about 90 days after you have closed escrow. So be prepared for that extra bill and payment. Again, another expense that you should plan for in that first year of ownership, which goes into figuring out “How much will property taxes be on my Tahoe Second Home?”

If you are buying a property that has a higher tax base than what you are paying, you’ll receive a tax notice that gives you have a tax credit, and they will apply that towards your next tax bill.

If a buyer needs an exact property tax amount for the Tahoe real estate they are purchasing, or if they need tax planning advice, I always recommend speaking to a tax professional.

Want to know more about what your Tahoe Real Estate Property Taxes are funding? Here is an example of a detailed breakdown of some of the additional local area taxes that make up that extra 0.25% for the West Shore, Placer County (Tahoe City and Homewood, a small portion of Tahoma) areas:

Tahoe Forest Hospital B&I 2008 Series
Tahoe Trukcee Un B&I 99a Sfid#2 Ref
No Tahoe Fire Special Tax
Tahoe Truckee Unified School Measure A
Tahoe Truckee Un B&I 93a98 Ref 2010
Sierra College Sfid #1 B&I 2004 S
Tahoe Truckee Un B&I 99b Sfid #2
North Tahoe Fire Suppression Asmt
Tahoe Truckee Un B&I 93b Ref 2004
Tahoe Truckee Un B&I 99a S fid #2
Placer County Mosquito & Vector Contr
Tahoe Trukcee Un B&I 2002a Sfid #2

Yes I know there are a lot of abbreviations that don’t make a lot of sense, and it seems that the same item reappears several times, but this is a current breakdown from a recent purchase in the Homewood area on the West Shore of Lake Tahoe in unincorporated Placer County.

There are other taxes that are unique in El Dorado County for the Tahoma (most of Tahoma, all of Meeks Bay and Rubicon Bay are all in El Dorado County) area.

Properties in Kings Beach, Tahoe Vista, and Carnelian Bay have a Mellos Roos fee for the North Lake Tahoe Conference Center.

Truckee is mostly in Nevada county, but you’ll find Northstar, Martis Camp, Lahontan and Schaffer’s Mill all in unincorporated Placer County. you’ll find that those properties have their own unique assessments, along with the ones above. Buyers should always ask if there are special Mellos Roos fees, and/or private transfer fees on the sale of property in the specific community they are looking to buy.

During your escrow period you will have a chance as a Tahoe Buyer to learn more about the specific taxes that will come along with your Tahoe property. For planning purposes using 1.25% of your purchase price is going to give you a good idea of what your annual tax bill amount is going to be on that property.

Need help buying a Tahoe property? Give me a call!

Lake Tahoe, California Real Estate property taxes.

Thinking about making Lake Tahoe, California your second home? Check out the homes that are for sale here:

Want to see what condos are for sale in Lake Tahoe? Here are the current listings:

For all of your Tahoe real estate needs –

Laura A. Allen | 530.414.1260 | Laura@TahoeLaura.com
BROKER ASSOCIATE, Tahoe Real Estate Agent
CalRE# 01473598
Coldwell Banker, Tahoe City, CA CalRE#01908304

All information is deemed reliable, but is subject to change, and/or correction without notice.

How much will property taxes be on my Tahoe Second Home?