How are property taxes calculated?

coltle6920

coltle6920

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The houses footprint? Square footage? Finished living space?

Neighbors house was listed in public records at 2bedrms,2 full baths and approximately 1300sq ft. This was the record for the last 31yrs.Within the last year or so an large elevated deck was built off the back of house. It's about 350 sq. ft. The house is now under contract listed as 3bedrms,3 full baths and 1992 sq.ft. Public assessor records still show the original finished space inside and property taxes actually declined $200.

I know people do work on their house without pulling permits. I'm not looking to rat on my neighbor. I figure more power to her. It just strikes me as odd that the MLS listing touts the newer figures while showing the public records at the bottom.
I'm thinking that the new owners might get hit with a tax increase of almost $1k while being led to believe the taxes are only $1200.

Your thoughts or comments...
 
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My house had wrong specs at the appraiser office for a decade and I could never get them corrected. They had most everything wrong. My taxes were calculated on a par with the neighborhood. Once they tried to jack them up and I filed a protest, and won. The specs they had were just not possible when you looked at every other house in the neighborhood...which is the point I made when I protested my assessment. They still didn't correct the specs.
 
At least here, it SEEMS to be based on the area of livable floor space, i.e., that which is heated and cooled, plus the area of the lot(s) on which the house sits. Theoretically and legally, the appraised residential taxable value is supposed to represent the fair market value of the house and lot, but in practice the appraised value for taxes is usually a little less than FMV. And of course there are usually many different taxing entities - city, county, school district, hospital district, college district, etc., each with their own tax rates, and also various exemptions - homestead, disability, over 65, etc. For example, disabled vets here in Texas get a big tax break, and those over 65 with homesteads have some of their taxes frozen, no matter what the taxable value is. Ignoring exemptions, etc., annual residential property taxes in Texas will usually be roughly 2% of the appraised taxable value.
 
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In MN, it is based on "assessed market value", which is usually something less than what you can probably sell your house for. Improvements can add to the value if they are permitted or otherwise captured, but the main measure is sales of comparablehomes in the area.

The taxing authority will always have an appraiser's opinion to support its valuation. I you want to challenge it, you will have to develop appraisal testimony of your own.
 
Base on Ohio laws, They way a property sets on January 1st is how it will be valued for the year. So any building, or improvements won't/shouldn't be taxed until next year!

School boards hire little weasel law firms to get the most tax collected as possible! When we were building in the 90's and first decade of 2000, we kept getting taxed on houses that hadn't started until latter in the year. First year, there were 5. There is an appeal court with the county commissioners. We had all 5 "Joined" into one hearing, then proved that the land was vacant on Jan 1. went to proper tax rate. Year 2, there were 8. Same routine, same verdict! Sent a certified letter to school board to knock it off! Year 3, 15 houses. Different tactics, filed a harassment law suite against the school board AND against each school board member PERSONALLY! All 15 were dropped to proper tax rate within 48 hours!

An attack on your wallet is often best countered by an attack on someone else's wallet! In other words: MAKE IT HURT PERSONALLY!

Ivan
 
I had the same problem as glenwolde. They had it appraised as a 2 story and it is a ranch. Very obvious just by looking at the roofline. Took 3 years to get it corrected, and no they would not give me back any of previous years money.
Russ
 
coltle6920 said:
The houses footprint? Square footage? Finished living space?

Neighbors house was listed in public records at 2bedrms,2 full baths and approximately 1300sq ft. This was the record for the last 31yrs.Within the last year or so an large elevated deck was built off the back of house. It's about 350 sq. ft. The house is now under contract listed as 3bedrms,3 full baths and 1992 sq.ft. Public assessor records still show the original finished space inside and property taxes actually declined $200.

I know people do work on their house without pulling permits. I'm not looking to rat on my neighbor. I figure more power to her. It just strikes me as odd that the MLS listing touts the newer figures while showing the public records at the bottom.
I'm thinking that the new owners might get hit with a tax increase of almost $1k while being led to believe the taxes are only $1200.

Your thoughts or comments...
Click to expand...

A lot depends on who you are and who you know in many real property tax assessments! The next owner/s will get what is colloquially called a "WELCOME, new neighbor" tax bill in the coming tax year. This was very common in the area I left when I retired.
 
here they are calculated on the assessed value of building + property - when I purchased the house taxes were $400.00 a year , now $175.00 a week - nothing fancy or large home but in the highest taxed state !
 
schutzen-jager said:
here they are calculated on the assessed value of building + property - when I purchased the house taxes were $400.00 a year , now $175.00 a week - nothing fancy or large home but in the highest taxed state !
Click to expand...

So happy to have that nonsense behind me. The combined property and school taxes on my former home on Long Island have almost double since I left 12 years ago.
The current owners tax on that little slice of "heaven" in Lindenhurst is:
Tax.jpg
 
Sorry I kind of went around the question. Once when I challenged mine I went down to a hearing and asked them. They went by the average price per square foot in the area. The square footage was calculated by what was serviced by HVAC. If it wasn't heated or cooled it didn't count.

Another state I lived in once counted the garage if it was under the same roof. It will vary by location. Nobody is going to count area without a roof as far as I know. But a deck can still add value to the house and raise the assessment. So can outbuildings even if they don't have HVAC.

They were perfectly willing to compromise on the assessment if you gave them even half a reason. Usually they do not come and actually look at the property. That only happened if you challenged the assessment and then could still not reach an agreement. Then they'd send someone out to see what you're talking about. The assessor's decision is final. If you still don't agree you'll have to go to court. Good luck with that.
 
You have to remember that property taxes are dealt by the government and anything done by them is circumspect to say the least. Most government entities look at 'we the people' as the enemy to be fooled and used in the worst possible way. Am I biased, you bet, because I have had my share of run ins with government over my 87 years.
Most towns here in Maine hire their assessment done by outside companies and if they have biases then it shows in the taxes. In my town that assessment was big into multi bathrooms and garages so the single bath and one car garage got treated very well. Next time it might be just the opposite.
 
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Property Taxes are generally calculated by multiplying
The Assessed Value or taxable value by the Mil Rate.
Mil Rate defined as $1 of Tax per assessed $1,000.
Assessed value varies by state, full market value or a fraction of full value.
The Mil rate is usually set by local authorities and is a list funding for State and Local Gov organizations.
My Mil Rate here in Albuquerque is 47.75 per 1,000.
That equates to just under 1/2 of a Percent if you want to go that away.
By law, in NM taxable value is 1/3 of assessed market value.
 
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I think that pilgrim explained the way the taxes are calculated pretty much everywhere.

What varies a lot is how they determine the assessed value. In theory it's what your house would sell for on the open market, but in reality it's whatever your local taxing authority decides it is, and it's up to you if you want to prove them wrong, which is a real uphill fight.

Our county did a complete reassessment of all properties a couple years ago. I soon found out that even though I hired a state certified real estate appraiser who came up with a lower value than the county did, and that appraiser gave me a very detailed report of how he determined the true value, it meant nothing during the informal appeals process. I presented that report to the appeal board. They simply denied my appeal with no reason given.

The only way I could continue my appeal from there was by paying a filing fee and taking it to court, which would have also meant hiring a lawyer if I wanted any real chance of winning. I figured the cost outweighed any potential gains especially since I still had no guarantee I'd win, so I dropped it. Editorials in the local paper written by other home owners showed that others who filed an appeal were treated the same way, automatic denial no matter what evidence they had that the value set by the county was wrong.

It's true, you can't fight the government and win. Unless you have deep pockets.
 
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"It just strikes me as odd that the MLS listing touts the newer figures while showing the public records at the bottom." Listing agent is covering their liability by disclosing to any potential buyer that a huge blunder exist in the tax records. ( read- be on guard, new buyer, your tax bill may increase dramatically when they discover their mistake).

MMB617- you need to educated yourself on how your government proceeded with their appraisal. Just because you have an appraisal from a licensed appraiser probably has no weight in dealing with "the tax man". they have a published method and are under government mandate to attempt to make the community's values as similar as possible. That appraisal is just one man's opinion at the end of the day and his methods are most likely far removed from what the tax man is doing. you can not compare an apple to an orange, but you can use it as a basic to ask intelligent questions. Most people have no clue on how the tax man's values are arrived upon and a lot who complain do not want to learn or educated them self in the procedure, which is never hidden.

Mistakes are out there. I have not idea how Colorado tax people conduct business, but in my part of the world, someone puts boots on the ground with existing information in hand every couple of years for a full review of the property. the appraisal amount is calculated by similar to what the private appraiser follow, by measurements of improvements, age of structure and quality of construction, etc. I find it strange that no change in 31 years is in the records for the next door neighbor. I my part of the world, they use aerial photos of recent dates as also a review tool. Appraisal are somewhat of a "cookbook" approach so that improvements in a neighborhood are all valued similar to make it a fair process for payment of taxes.
 
You own your house but they get to charge you for living in it. HMMM Something doesn't seem right about that.
If you don't dispute your yearly tax appraisal within the set time period then you are SOL and they darn straight tell you that.
Three times I had to dispute my appraisals and each time it went in my favor. Realize tax appraisers often do their appraisals while sitting in their car on the street in front of your house.
 
LittleCooner said:
"It just strikes me as odd that the MLS listing touts the newer figures while showing the public records at the bottom." Listing agent is covering their liability by disclosing to any potential buyer that a huge blunder exist in the tax records. ( read- be on guard, new buyer, your tax bill may increase dramatically when they discover their mistake).

MMB617- you need to educated yourself on how your government proceeded with their appraisal. Just because you have an appraisal from a licensed appraiser probably has no weight in dealing with "the tax man". they have a published method and are under government mandate to attempt to make the community's values as similar as possible. That appraisal is just one man's opinion at the end of the day and his methods are most likely far removed from what the tax man is doing. you can not compare an apple to an orange, but you can use it as a basic to ask intelligent questions. Most people have no clue on how the tax man's values are arrived upon and a lot who complain do not want to learn or educated them self in the procedure, which is never hidden.

Mistakes are out there. I have not idea how Colorado tax people conduct business, but in my part of the world, someone puts boots on the ground with existing information in hand every couple of years for a full review of the property. the appraisal amount is calculated by similar to what the private appraiser follow, by measurements of improvements, age of structure and quality of construction, etc. I find it strange that no change in 31 years is in the records for the next door neighbor. I my part of the world, they use aerial photos of recent dates as also a review tool. Appraisal are somewhat of a "cookbook" approach so that improvements in a neighborhood are all valued similar to make it a fair process for payment of taxes.
Click to expand...

They use planes occasionally in my small town. They do discover things like a new garage built, addition put on a building ETC.

As there are many camps on the lake most are summer only and the people just do what they want for the most part. The officials (Assessor, Building inspector) go out about now as they wait till most of the trees are bare thusly getting a good look.
 
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I truly believe that the real estate marketers influence property taxes.
The bid real estate and it always goes out to the real estate agency that agrees to sell at the highest cost. The selling value is a factor in determining the tax. Ever wonder why so many tax assessors are directly or indirectly involved in the real estate business?
Jim
 
I'm glad I live in Fl. Once you apply for homestead exemption and get it , your taxes can only go up 5% a year , I'm pretty sure 5% . Now if someone came in and bought my house , they'd probably be looking at taxes of $3500-4000 . Of course we've been here sine 1994 , so you can see it works out . Mine were $2230 this year , which I consider not bad .
 
gman51 said:
Realize tax appraisers often do their appraisals while sitting in their car on the street in front of your house.
Click to expand...

It wasn't quite that bad, but close. The county hired a company to do the appraisals and all they did was go around and measure the size of the lot, get the dimensions of the house and take pictures. They never went inside any homes.

LittleCooner said:
MMB617- you need to educated yourself on how your government proceeded with their appraisal. Just because you have an appraisal from a licensed appraiser probably has no weight in dealing with "the tax man". they have a published method and are under government mandate to attempt to make the community's values as similar as possible. That appraisal is just one man's opinion at the end of the day and his methods are most likely far removed from what the tax man is doing. you can not compare an apple to an orange, but you can use it as a basic to ask intelligent questions. Most people have no clue on how the tax man's values are arrived upon and a lot who complain do not want to learn or educated them self in the procedure, which is never hidden.
Click to expand...

I know exactly how the county arrived at their figures. They took the very limited information gained as I outlined above and plugged it into a computer program that spit out the value. I did tons of research on this reassessment and thought I knew how to get a fair value put on my home.

Which is why I hired a state certified appraiser who did a very in-depth job. He went through every room in the house measuring and taking notes and pictures, and did the same thing outside. He then presented data on three similar properties in my area that had sold recently for less than my appraisal. He then prepared a 14 page report of his findings which I presented to the appeal board at my informal appeal. I thought I had it covered till I got the letter saying my appeal was denied, no reason given.

As it turned out the informal appeal boards were made up of citizens with no real estate experience who had been given a short crash course on what to do, which was basically deny everyone. Anyone not satisfied after that could take it to court. The county knew most people wouldn't do that due to the expense.

Tomorrows election should be interesting. One of the candidates for county commissioner has billboards up saying "Do you remember the botched reassessment? Amy does." I'll bet she's the top vote getter.
 
They figure out how much money they want and divide it by the last value they had on the homeowners houses. Then they find out who protests and get what they can and next year spread the difference across the ones that did not protest. They can do anything they want no matter what the law says if you do not call them on it. You should protest at least every other year. Homestead exemption here is a small deduction, but once you are 65, the school part of property tax (the vast majority) freezes until you sell.
 
In Texas the law says that assessed value should be the fair market value of the property. Different counties have different methods of determining that value, though. Here the assessed value is actually pretty close to what you could sell the home for - at least at the time of appraisal. Being in an oil boom/bust area home prices are prone to rise (or fall) with activity in the oilfield - sometimes dramatically so. The local taxing entities set their tax rates to achieve whatever level of funding they require. There are limits in place on how much they can raise the tax rate without a rollback election to approve or disapprove the increase, though. A homestead exemption for one's primary residence can reduce the assessed value by a small amount, and turning 65 locks your school tax in at that level for the rest of the time you live in that home. School tax accounts for about 2/3 of property tax here.

I've only protested my valuation once when my home's value was appraised much higher than very similar homes in the same neighborhood - some the exact same "model." I didn't have to file a formal protest, though. The assessor took a look at my data, and agreed immediately. He reduced my appraisal on the spot more than I had requested.
 
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bigwheelzip said:
So happy to have that nonsense behind me. The combined property and school taxes on my former home on Long Island have almost double since I left 12 years ago.
The current owners tax on that little slice of "heaven" in Lindenhurst is:
Tax.jpg
Click to expand...

Haha..I'm in Huntington, the north shore of LI.
That 16k number is what I'm paying.(2400 sq ft on half acre)
My neighbor, who has a McMansion is paying close to 40k.(5000 sq ft on 2 acres)
 
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