Property taxes

What are Property Taxes?

Property taxes are mandatory financial charges imposed on property owners by local governments. These taxes are typically levied annually, and are based on the assessed value of the homeowner’s property, including land and buildings. The tax is generally a small percentage of the property’s assessed value, with the rate varying greatly depending on the location.

Why are Property Taxes Important?

Property taxes serve as a crucial source of revenue for local governments and are commonly used to fund public services such as schools, parks, roads, and law enforcement. They help ensure that property owners contribute to the cost of these services, which benefit all residents and add value to properties.

How are Property Taxes Calculated?

The amount of property tax a homeowner is required to pay is determined by multiplying the tax rate by the assessed value of the property. The assessed value is typically determined by a public tax assessor who evaluates the property’s worth based on various factors like location, property size, and construction type. The tax rate, also known as the millage rate, is set by local governments.

Property Taxes and Homeowner Associations

For homeowners in a Homeowner Association (HOA), the association may handle certain aspects of property taxes. Some HOAs may include property taxes in their fees, while others may provide services or improvements that can affect property tax assessments. It’s important for homeowners to understand their HOA’s involvement in property taxes to avoid any unexpected costs.