Legal Question in Real Estate Law in California

It is illegal to cheat the taxing authorities. Whether the conduct described (failure to record a quitclaim deed) amounts to a fraud on the tax collector or not would require examination of additional facts including the intent of the grantee, the extent of the interest transferred by the deed (if any) and perhaps the collusion (if any) of the nonprofit. There could be other factors. From the way the situation is described in your question, however, I think there is at least a hint of a fraudulent intent in the third party's failure to disclose his interest to the taxing authorities.

Here's a sidebar thought. Note that you use the expression "is currently owned." I think you mean "is currently shown on the public records as owned." The effect of being given a quitclaim is to change ownership. An unrecorded deed is valid as to the grantor, grantee and others with actual or constructive knowledge of the deed.

No. Once a deed is delivered and accepted, title has legally transferred regardless of whether or not it has been recorded. Recording just puts the world on constructive notice of who holds title for lien and fraud purposes.

I think Mr. Whipple accurately answered your question. As I read it, the new owner is not having the quit claim deed recorded, because the tax assessor's office shows record title in a non-profit organization, and the new owner does not want to pay property taxes.