Property tax is a tax levied by your state on the property you own. Most states only tax real property (real estate), but some states also tax personal property. Local governments impose property tax as a source to generate revenue for their states. Property tax can be for real estate and personal property and is usually calculated to be the fair market value of the property multiplied by the assessment ratio multiplied by a tax rate. Property tax obligations usually have to be paid by the property owner. One disadvantage to property tax is that the value is fixed, while taxpayer’s income tax obligations change depending on the taxpayer’s income.
Each state has a different tax rate for property. Generally, you are taxed a percentage of your property's "appraised value." Local officials determine value and the amount of tax is determined annually based on the market value of each property on a specific date
There are several ways the government determines how much your property is worth, or its "appraised value." Usually they use the purchase price of your home or land to determine how much they should tax it. Your property tax will change with time as the real estate market fluctuates and your property is re-appraised, also known as equalization.
Fair market value when deciding property tax is what a buyer of property would be willing to pay for the property on the open market with no undue influence or pressure from seller or other things. As a homeowner the way real estate fair market value is determined is by looking at what other similar properties have been sold in the same area. Usually the sales in that area must have been in the last 6 months in order for it to be compared to one another. Anything over 6 months, appraisers would not look at when comparing the properties for fair market value. The home must also be similar in relation to size, style and characteristics
If you believe the government has overvalued your property and are charging you too much in property tax, you can contest the appraisal of your property. Each state has different regulations about how to contest a property tax appraisal. Most states offer a hearing before the body that does land appraisals. In that hearing, you are given an opportunity to present evidence of how the government overvalued your home. The hearing body will then make a ruling on whether or not the original appraisal was correct.
All states guarantee you an appeal if you are dissatisfied with the property tax ruling. Property tax determinations can be appealed to either an appealing governing body or your state's courts, depending on your state.
Another way to try to lower your property tax for your home is to check out similar properties in your area and see what they pay for a tax bill. Property tax bills are public information and can be accessed online in many states. Make sure that the home you are comparing your home to have the same tax classification such as similar size, age, and characteristics.
Property tax law can be very complicated. To make matters worse, every state has different property tax laws and different appeal processes. An experience tax lawyer can help you understand your state's property tax law and determine whether you are paying a fair property tax. If necessary, a lawyer can help you contest the appraisal of your home or bring an appeal.
Last Modified: 11-19-2017 11:14 PM PSTLaw Library Disclaimer
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