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5 Year Installment Plan of Redemption
A property owner may initiate an installment plan of redemption to redeem prior year defaulted secured property taxes. Most prior year delinquent taxes may be eligible for a five year payment plan. This plan provides a means of paying secured property taxes that have been delinquent for one or more years, with payments being made in a minimum of five installments in accordance with California Revenue and Taxation Code. While the installment plan is in good standing, the property may not be tax-defaulted subject to the power to sell, nor the right of redemption terminated.
In order to initiate a payment plan our office must receive a signed agreement form and an initial payment of at least 20% of the redemption amount plus a onetime $25 payment plan fee. Once initiated, in order to keep the installment plan in good standing the property owner must comply with both of the following:
- Installment payments of 20% or more of the redemption amount, plus accrued interest of 1.5% per month on the unpaid balance at the first day of each month, must be paid on or before April 10th of each year.
- Current year taxes must also be paid on or before April 10th of each year, this includes any supplemental assessments.
Initial payments to start the installment plan must be submitted to our office. We accept cash, money order, check and credit/debit card in our office. Payment can also be mailed to our office in the form of a check or money order with the signed agreement form.
Once the payment plan is active, the annual installment or total redemption amount can be paid through our website. While the payment plan is in good standing, the taxpayer may submit payments at any interval throughout the fiscal year, as long as 20% or more of the redemption amount plus accrued interest of 1.5% per month is received by April 10th of each year. These payments may only be submitted to our office and cannot be paid online.
Default or Cancellation of Installment Plan
If either condition listed above is not met, the payment plan will default. This means you are no longer eligible to make partial payments on your redemption balance. If the payment plan has defaulted, redemption penalties will be re-calculated which may result in an increase in the amount due. After the penalties are recalculated, any payments received while the payment plan was active will be credited towards the balance owed.
A new payment plan can only be initiated after the start of the next fiscal year, July 1st. If the property will be subject to the tax collector’s power to sell after the payment plan has defaulted, the property will not be eligible to start a new payment plan. To enroll in a new installment pay plan, our office requires a new signed agreement as well as an additional initial payment of 20% of the redemption amount plus a $25 payment plan fee.
- Review and complete Installment Plan Agreement
- Submit signed agreement with an initial payment of 20% of the redemption amount plus a onetime $25 payment plan fee.
- Keep the payment plan in good standing. Contact the tax collector prior to the April 10th due date and confirm the amount due. Be sure to inquire about current taxes, supplemental taxes and the amount due for your installment plan.
Please note: If you open an installment account between July 1st and the following April 10th, the current year's taxes and any supplemental taxes must be paid by April 10th or the account will default. To open an account between April 11th and June 30th, the current year's taxes (plus any penalties and charges) must first be paid in full. You can open an installment account after the date on which the property has become tax defaulted (June 30th) and within five years of that date (at which time your property becomes subject to the power of sale).
4 Year Escaped Assessment Pay Plans
Escaped Assessments for prior fiscal years entered on the current year tax roll; whether Secured or Unsecured, at the option of the taxpayer may be paid over a four-year period. The taxpayer may exercise this option if the additional tax is over $500.00. The Revenue and Taxation code 4837.5 states installments of 20 percent or more shall be paid over a five year period without penalties if the escaped assessments are the result of an assessor error or with a penalty of 3/4 of 1% per month if the escaped assessments are caused by an assessee error.
In order to implement a 4 year payment plan for eligible escaped assessments, the assessee must sign a written agreement to request installment payments. Requests for payment plans must be submitted prior to the delinquent date. For Secured Escaped Assessments the requests must be submitted on or before April 10th, for Unsecured Escaped Assessments the request must be submitted by on or before August 31st.
The current taxes must be paid timely each year by the due dates. If a payment is not paid timely, all penalties, interest and other charges will become due and payable.