Understanding Property Taxes: What Every Homeowner Should Know
Making sure you understand your property taxes is a big part of owning a home, whether you’re a first-time buyer or a previous homeowner.
How do property taxes work?
Local governments collect annual fees known as property taxes on real estate. These taxes help pay for a variety of public services, including local government, infrastructure, emergency services, and education. The assessed value of your property and the tax rate are what determine how much property tax you pay.
How are real estate taxes calculated?
Property taxes vary on location and rules of the local government. The assessed value of the property and the tax rate, however, are typically the two factors at effect. Local tax assessors decide the assessed value. To determine the actual tax amount due, the tax rate is a percentage applied to the assessed value.
Property tax variables that impact include the following:
Your ability to pay property taxes depends on several circumstances, including:
A. Property Assessment: A tax assessor determines the assessed value of your property by taking into account a variety of elements, including market value, property size, location, and upgrades.
B. Tax Exemptions and Deductions: For some homeowners, such as senior citizens, veterans, or people with disabilities, some jurisdictions provide exemptions or deductions that lower the assessed value or tax rate. Knowing about these exemptions can help you pay less in taxes.
C. Tax Rates: Depending on the needs of the community and the necessary funding for public services, the tax rate set by local government authorities may change.
Property taxes are an important part of homeownership and serve an important role in supporting local communities. Every homeowner must understand how property taxes are calculated, the factors that influence it, and the potential for exemptions and deductions. Don’t forget if you ever disagree with your assessment, you can contact your local government and appeal the assessed value too!