How are My Property Taxes Assessed, and How Often Will My Taxes Change?

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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Written by Jeffrey Johnson
Insurance Lawyer Jeffrey Johnson

UPDATED: Jul 16, 2021

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The frequency in which property value is assessed for tax purposes will vary, depending on your state or district. In the majority of states, property value is assessed for property tax purposes every five to seven years. However, some states only assess the value of the home upon the sale or refinancing of the property, while other states assess property values every year.

How Property Value is Determined

When property is assessed, a government assessor, hired either by the county or state, will come out to physically inspect your home to determine the measure of its worth. After the assessor acquires a number of factors about your property, they will usually determine the value of your home through a formula based on the total replacement cost, the market value, and the rental value of your home. To calculate the replacement cost of your home, the assessor will inspect the building materials and take your maintenance costs into consideration. If you are making income on your home, they will also take this into consideration when determining the value. To find the market value of your home, the assessor will compare your home to similar homes in the area that have recently sold.  Aside from the physical condition of your home, the market value of your home will turn heavily on real estate markets trends. If your home is an architecturally popular style the year that it is assessed, the market value of your home may be inflated. On the other hand, in a depressed market, the market value of your home may seem extraordinarily low.

Property Taxes are Determined by the Property Value

The assessment of your property’s value is used to find your required annual property taxes. If you are in a majority state, in which the value of your property is only assessed every five to seven years, the determined tax rate will stay consistent during this time period. Your determined tax rate is found through the states “assessment rate” and “mill levy.” Once your property value is found, the county or state will apply the assessment rate. This rate varies widely among districts. For example, if the value of your home is $300,000, and your states assessment rate is 40%, then your taxable property value is $120,000. The state property tax percentage, or “mill levy” is then applied to the taxable property value to determine your annual property taxes. This means that if the state tax percentage is 2%, and your taxable property value is $120,000, your annual property taxes will be $2400.

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