How are property taxes allocated within a tenancy in common?
Because property owned as a tenants in common is not legally divided, it has a single assessed value and the co-owner group will receive a single property tax bill (rather than separate bills for each co-owner). In most cases, the starting point for allocating the property tax among the owners should be the amount that each co-owner paid for his/her interest. When the property tax is increased as the result of the resale of a tenancy in common share, the buyer should pay the entirety of the increase. A resale by one co-owner should never increase a non-selling co-owner’s property tax burden. Similarly, when the owner of an entire property sells some tenancy in common shares but retains an ownership interest, his/her property tax allocation should be based on the pre-sale assessed value (meaning that the seller’s property tax actually decreases rather than increases after the sale). When property tax increases as the result of some non-sale-related activity by a co-owner (such as an imp
In most counties including San Francisco, the County Assessor will refuse to issue separate property tax assessments and bills for TIC owners because property owned as a TIC is not legally divided. As a result, the TIC building has a single assessed value and the co-owner group will receive a single property tax. There are California counties (e.g. Sonoma County) where TICs receive separate assessments and bills, and the matter has been considered by the S.F. Assessor. Where the TIC building receives a single property tax assessment and bill, it is necessary for the tenant in common owner to allocate tax responsibility internally. The starting point for tax allocation should be the amount that each co-owner paid for his/her interest. When the property tax is increased as the result of the resale of a tenancy in common share, the buyer should pay the entirety of the increase. A resale by one co-owner should never increase a non-selling co-owner’s property tax burden. Similarly, when the
