Property Tax

Overview

Most commercial and residential property is taxable. Property tax is also known as a millage tax or ad valorem tax and is based on the assessed value of a property. Property tax laws vary from state to state, and community to community, and assessed values are determined by a state, county, or independent tax assessors.

Your property tax is based on a percentage of your property's assessed value. This percentage varies based on where your property is located and whether it is commercial or residential. Other factors such as school districts and commercial viability may influence the property's assessed value. The county or municipal tax assessor will determine your tax rate.

How It Works

Property tax is calculated as a percentage of the property's assessed value. An agency, such as a county tax assessor, calculates the property's assessed value based on a variety of factors. Assessed value varies from property to property. Then, the tax assessor will use a percentage value to calculate the amount of tax owed based on the property's assessed value. In general, property tax rates within a certain area are similar and do not deviate substantially from the local average.

When the property tax is expressed a per mille (an amount per thousand units of currency used to define the value of the property), and when a millage rate or mill levy is used, it is calculated as one-thousandth of a dollar.

The tax assessor is a public official responsible for assessing the tax on property. An appraiser may work for either the government or a private enterprise.

Property taxes fund a variety of municipal projects. The city or county government will determine how to use funds.

Benefits

Property taxes fund a variety of municipal expenses every year. The revenue generated from property taxes fund schools, government salaries, and road repairs. Property taxes also fund community service, cultural programs and leisure activities.

Cost/Pricing

Your property taxes vary based on a variety of factors including where you live and whether your property is commercial or residential. In general, property values within an area are similar, but they are not necessarily the same. A variety of factors influence the assessed value of a commercial or residential property.

Timing

Commercial and residential property owners must pay property taxes on an annual basis.

Companies/Industries

Sometimes, people might dispute the assessed value of a property. In these situations, an independent property appraiser who is a nongovernmental employee may be called to settle the dispute.