Notice of Supplemental Property Tax Bill
Reviewed by Jimi (James) Allyn · Founder, Verity NHD · 37-year real estate professional
Statutory notice telling the buyer that a reassessment after purchase will produce one or two supplemental tax bills that are not included in the impound account.
What it is
When a California property changes ownership, the assessor reassesses it at the new value. The regular annual tax bill was already issued based on the prior assessed value, so the difference is billed separately — as a supplemental tax bill. Depending on when in the fiscal year the sale closes, the buyer may receive one or two of them.
Civil Code section 1102.6c requires that a specified notice be delivered to the buyer, in a prescribed format and type size, stating that the buyer may receive supplemental tax bills that will not be paid by the lender through an impound account, and that the buyer is responsible for paying them directly to the county tax collector.
This is another prescribed-language disclosure: the statute tells you what the notice says. Section 1102.6c lets you deliver it in the purchase contract, in the transfer disclosure statement, in an addendum, or as a separate document — the placement is your choice. The practical task is making sure the form you use carries the current statutory text.
The reason this disclosure exists is simple and human. A buyer who budgeted a monthly payment with taxes impounded opens a five-figure bill from the county six months after closing and assumes something went wrong. Nothing went wrong. But if nobody told them, the story they tell is about their agent.
This page is general information, not legal advice — confirm current C.A.R. form revisions.
Who signs it
The seller is responsible for delivery; in practice the notice is built into the purchase agreement or the TDS package that both parties are already executing, so the contract or disclosure signatures carry it. The buyer acknowledges receipt.
Escrow commonly reinforces the point in closing documents, and that is helpful — but escrow's courtesy explanation is not a substitute for the statutory notice being present in the transaction documents.
When it's due
Before transfer of title. Because the notice is normally embedded in the contract or the disclosure package, the timing task is really a form-currency task: confirm the version you are using contains the current statutory text.
Separately, timing shapes the buyer's actual bill. A closing early in the fiscal year and a closing in the spring produce different supplemental billing patterns. Explaining that at contract — roughly, and with the county as the authority — is one of the highest-value five minutes an agent can spend with a buyer.
If it's missed
The transaction is not voided, and the tax is owed regardless — the county's claim does not depend on whether the disclosure was made. What is at stake is the buyer's reliance claim and, more commonly, an avoidable dispute at a moment when the buyer has just spent everything they had on a down payment.
An unpaid supplemental bill can also become a delinquency with penalties on a brand-new homeowner's record, since it is not impounded and not sent to the lender. That escalation is what turns an unpleasant surprise into a real grievance.
Common mistakes
Assuming the impound account covers it. It does not. Say so plainly, in writing.
Estimating the amount. Point to the county assessor and the reassessment mechanism; do not invent a number.
Conflating it with Mello-Roos. Two different bills, two different statutes, both unexpected.
Leaving it to escrow. Escrow explaining it is good. The statutory notice being in your documents is required.
Never mentioning that two bills are possible. Buyers who expect one and receive two assume an error.
Statute
- Cal. Civ. Code § 1102.6c (supplemental tax notice)
- Cal. Rev. & Tax. Code § 75 et seq. (supplemental assessments)
This page is general information, not legal advice. Confirm current forms with C.A.R. and the DRE.
How Verity handles it
The tax section of our report shows the parcel's current assessed value and tax detail, which gives you the starting point for explaining how a reassessment at the purchase price will generate the supplemental bill.