§ 1268.420.Acquisition Makes Property Exempt From Taxes
Title 7. Eminent Domain Law · Chapter 11. Postjudgment Procedure · Article 5. Proration of Property Taxes · Enacted 1979 · no amendments on record · Last verified July 29, 2026
In one sentenceSection 1268.420 treats the agency's tax liability differently depending on whether acquisition makes the property tax-exempt -- uncollectible if it does, collectible from the agency as assessee if it doesn't -- and, on dismissal, awards the defendant any unpaid taxes the agency would have owed up to that point.
(1)If the acquisition of property by eminent domain will make the property exempt property as defined in Section 5081 of the Revenue and Taxation Code, any ad valorem taxes, penalties, or costs on the property for which the plaintiff is liable pursuant to Section 1268.410 are not collectible.
(2)If the acquisition of property by eminent domain will not make the property exempt property as defined in Section 5081 of the Revenue and Taxation Code, the plaintiff shall be deemed to be the assessee for the purposes of collection of any ad valorem taxes, penalties, and costs on the property for which the plaintiff is liable pursuant to Section 1268.410.
(b)To the extent there is a dismissal or partial dismissal of the eminent domain proceeding, the amount of any unpaid ad valorem taxes, penalties, and costs on the property for which the plaintiff would be liable pursuant to Section 1268. 410 until the entry of judgment of dismissal shall be awarded to the defendant. The amount awarded shall be paid to the tax collector from the award or, if unpaid for any reason, are collectible from the defendant.
Plain-English Summary
Section 1268.410 fixes liability between the parties; this section governs how the taxing authorities collect on that liability, and the answer depends on what the acquisition does to the property's tax status.
If acquiring the property by eminent domain makes it exempt property under the Revenue and Taxation Code, any taxes, penalties, or costs for which the agency is liable aren't collectible going forward -- the exemption cuts off collection rather than shifting it to the agency as a payer. If the acquisition doesn't create that exemption, the agency instead becomes the assessee of record for purposes of collecting the taxes it's liable for, so the taxing authority looks to the agency directly.
Dismissal changes the picture. If the eminent domain proceeding is dismissed, in whole or in part, any unpaid taxes, penalties, and costs the agency would have owed under § 1268.410 up through the dismissal judgment get awarded to the defendant instead. That amount is paid to the tax collector out of the award, or, if it goes unpaid for any reason, becomes collectible from the defendant directly.
Frequently Asked Questions
What happens to tax liability if the acquisition makes the property exempt?
Any taxes, penalties, or costs the agency would owe become uncollectible, rather than being paid to the taxing authority.
What happens if the acquisition doesn't make the property exempt?
The agency is deemed the assessee for purposes of collecting the taxes, penalties, and costs it's liable for.
What happens to unpaid taxes if the proceeding is dismissed?
The unpaid amount the agency would have owed up to the dismissal is awarded to the defendant, paid from the award to the tax collector, or collectible from the defendant if unpaid.
Amendment History
Repealed and added by Stats. 1979, Ch. 31.
Source & verification. Section text is reproduced verbatim from
the Deering's California Codes Annotated / vLex. Enacted by the California Legislature.
Last verified July 29, 2026.
· Official source
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