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COVID-19’s Impact on California Property Tax Deadlines and Planning Considerations

The Coronavirus Disease 2019 (COVID-19) crisis has raised questions and concerns about upcoming property tax payment and reporting deadlines in California and whether taxpayers may be entitled to any relief due to a decline in property values. The discussion below addresses these issues.

April 10 Property Tax Payment Deadline

California state legislators, the state controller, the California Association of County Treasurers and Tax Collectors, and various county tax collectors have recently issued statements regarding the impact of the COVID-19 crisis on the April 10 property tax payment deadline.

While the April 10 deadline for paying the second installment of property taxes levied for the 2019-2020 fiscal year currently remains unchanged, penalties and other charges resulting from late payments due to the COVID-19 crisis may be waived.

Under existing authority, tax collectors may waive late-payment penalties under one of two circumstances. First, if the offices of any county are closed on April 10 pursuant to an order of the board of supervisors under California Revenue and Taxation Code section 2619, and as a result, taxpayers are unable to make property tax payments to that county by April 10, the law permits taxpayers to make payments on the next business day that the county offices are open without incurring a penalty.

Second, tax collectors have the authority to waive penalties resulting from a late payment due to “reasonable cause and circumstances beyond the taxpayer’s control, and occur[ing] notwithstanding the exercise of ordinary care in the absence of willful neglect[.]” Cal. Rev. & Tax. Code § 4985.2. Relief under this rule is discretionary and will be evaluated on a case-by-case basis. Taxpayers unable to pay by April 10 will need to request relief and demonstrate to the tax collector that the inability to make a timely payment was due to the COVID-19 pandemic. For example, the Los Angeles County Tax Collector has set up a special team to process penalty relief requests, and has advised impacted taxpayers to submit a request for penalty relief online, beginning on April 11. Other local tax collectors have started discussing the possibility of automatic penalty relief under certain conditions, but this development is still relatively new.

Further, on March 20, California Assemblymembers Philip Ting and Autumn Burke issued a letter urging tax collectors to apply these penalty waivers “consistently and generously across counties to maximize relief during this emergency.” Ting and Burke also stated that they “plan[] to advance emergency legislation as soon as practicable to codify this direction and retroactively waive interest and penalties for homeowners and other taxpayers adversely impacted by this pandemic.” Industry groups may also approach the California Legislature to request some form of disaster relief. There may be an update on these efforts sometime in April as the California Legislature is currently in joint recess but scheduled to reconvene on April 13.

Decline-In-Value Appeals

Due to the economic downturn caused by the COVID-19 pandemic, many taxpayers have already experienced, or may experience, a decline in revenues in 2020, which may be used to establish a decline in the value of the taxpayer’s real property. Impacted taxpayers—including owners of shopping centers, retail stores, amusement parks, airport concessions, airlines and multifamily residential properties—may be able to lower their property tax assessment for 2021 and future years by applying for a reduced assessment. Some taxpayers (e.g., airport concessionaires) may even be able to get relief for the 2020 fiscal year by showing that they foresaw the economic downturn as of Jan. 1, 2020.

May 7 Business Property Statement Filing Deadline

Businesses are required to file an annual Business Property Statement (Form 571-L) if their aggregate cost of business personal property exceeds $100,000, or if the assessor requests the information. A penalty applies if the statement is not received by May 7. While this filing deadline currently remains unchanged, there is an effort by industry groups to extend the deadline.

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About this Author

C. Stephen Davis Shareholder Greenberg Traurig Orange County Property tax counseling and litigation
Shareholder

C. Stephen Davis focuses his practice on property tax counseling and controversies in the real estate, energy, oil, hospitality and healthcare industries. He litigates property tax controversies before local assessment appeals boards, superior courts, courts of appeal, and the California Supreme Court. His practice also includes participating in rule-making and other proceedings before the California State Board of Equalization.

949-732-6527
Bradley Marsh, Greenberg Traurig Law Firm, San Francisco, Tax Law Litigation Attorney
Shareholder

Bradley R. Marsh is an attorney at the San Francisco office and focuses his practice on tax controversy matters, including property, sales, payroll, business license, employment, franchise, parcel, district, documentary transfer, transient occupancy, utility user, income, parking, gift and estate taxes. He serves as a co-chair of the State and Local Tax (SALT) Practice. Brad represents clients in audits, litigation and administrative hearings, as well as analyzing transactions and business models, and providing legislative solutions. 

Concentrations

  • State and local tax

  • Real estate purchase and sale

  • Government relations

  • Tax transactional

  • Unclaimed property & escheat

415-655-1252
 Cris K. O'Neall Shareholder GT Orange County Property tax counseling Ad valorem property tax appeals and litigation Litigation and appeals State and Local Tax
Shareholder

Cris K. O’Neall focuses his practice on ad valorem property tax and assessment counseling and litigation (appeal hearings and trials). For over 25 years, he has represented a variety of California taxpayers in equalization proceedings before county assessment appeals boards, the State Board of Equalization, the Superior Court, the California Court of Appeal, and the California Supreme Court.

The clients Cris has served include owners of the following property types:

  • Healthcare (hospitals, skilled nursing and assisted living facilities, medical office buildings)...

949-732-6610
Associate

Ruben Sislyan focuses his practice on California state and local tax controversies at the audit, administrative, and judicial levels. He has broad experience representing Fortune 500 and middle-market companies, closely held businesses, start-ups, families, and individuals in a wide range of state and local taxes, including corporate franchise/income, personal income, sales and use, property, tobacco, and gross receipts and other local taxes.

Ruben helps clients navigate through all stages of California’s complex administrative tax controversy process. He regularly practices before...

310.586.7765
Jennifer Vincent Audit & Tax Defense Attorney
Associate

Jennifer A. Vincent is an associate in the Audits, Litigation & Criminal Tax Defense Group, focusing on federal and state tax controversies and litigation.

Concentrations

  • Tax compliance counseling

  • Civil tax controversies

  • Penalty disputes

  • Offshore audits and litigation

  • Estate and gift tax valuation disputes

  • Voluntary disclosures

  • Employment tax audits and litigation

  • State income tax and residency audits and litigation

  • ...

415-655-1249