Cal. Code Regs. Tit. 18, §§ 24345-2 - Taxes for Local Benefits

(a) Except as provided in subsection (b) of this regulation, so-called taxes, more properly assessments, paid for local benefits, such as street, sidewalk, and other like improvements, imposed because of and measured by some benefit inuring directly to the property against which the assessment is levied do not constitute an allowable deduction from gross income. A tax is considered assessed against local benefits when the property subject to the tax is limited to property benefited. Special assessments such as flood control district assessments are not deductible, even though an incidental benefit may inure to the public welfare. The real property taxes deductible are those levied for the general public welfare by the proper taxing authorities at a like rate against all property in the territory over which such authorities have jurisdiction. For treatment of assessments for local benefits as adjustments to the basis of property see Section 24916(a).

(b)

(1) Insofar as assessments against local benefits are made for the purpose of maintenance or repair or for the purpose of meeting interest charges with respect to such benefits, they are deductible. In such cases the burden is on the taxpayer to show the allocation of the amounts assessed to the different purposes. If the allocation cannot be made, none of the amount so paid is deductible.

(2) Taxes or assessments levied by an irrigation or other water district are deductible if such taxes or assessments are levied at a uniform rate upon all property within the district.

Notes

Cal. Code Regs. Tit. 18, §§ 24345-2

1. New Reg. 24345(b) filed 12-14-64; effective thirtieth day thereafter (Register 64, No. 25).
2. Renumbering and amendment of Section 24345(b) to Section 24345-2 filed 9-3-82; effective thirtieth day thereafter (Register 82, No. 37).

Note: Authority cited: Section 26422, Revenue and Taxation Code. Reference: Section 24345, Revenue and Taxation Code.

1. New Reg. 24345(b) filed 12-14-64; effective thirtieth day thereafter (Register 64, No. 25).
2. Renumbering and amendment of Section 24345(b) to Section 24345-2 filed 9-3-82; effective thirtieth day thereafter (Register 82, No. 37).