As a homeowner, you’re required to pay property taxes to the local government where your property is located. These taxes help fund various public services like schools, police, and fire departments, road maintenance, and garbage collection in your area.
The amount of property tax you owe is based on the value of your property. This value is determined by the local government’s tax assessor, who assesses the value of your property based on factors like its location, size, condition, and other features. The assessed value is usually a percentage of the property’s fair market value, which is the estimated price that your property would sell for on the open market. As you have probably already noticed, these matters are complex, and even more so for first-timers. Your best bet will be to consult this matter with a tax attorney. With their expert guidance you can rest easy knowing you have followed this legal process correctly.
Once the assessed value of your property is determined, the local government applies a tax rate to calculate the amount of property tax you owe. This tax rate is usually expressed as a percentage of your property’s assessed value. The exact tax rate you’ll pay depends on the local government’s tax policy and can vary from one location to another.
Property taxes are typically paid on an annual or semi-annual basis. You’ll receive a bill from the local government for the amount of property tax you owe. You can usually choose to pay the tax bill in full or in installments, depending on the rules of your local government.
If you have a mortgage on your property, your mortgage lender may collect a portion of your property tax with each monthly mortgage payment and hold it in an escrow account to pay the property tax bill when it’s due.
If you fail to pay your property taxes, the local government may impose penalties, interest charges, or even foreclose on your property. It’s important to pay your property taxes on time to avoid these consequences or else you may need to get legal help from a tax lawyer.
Here are the property tax rates for all 50 U.S. states in alphabetical order as of the knowledge cutoff date of September 2021:
| State | Average Property Tax Rate |
|---|---|
| Alabama | 0.42% |
| Alaska | 1.18% |
| Arizona | 0.63% |
| Arkansas | 0.61% |
| California | 0.77% |
| Colorado | 0.57% |
| Connecticut | 2.07% |
| Delaware | 0.55% |
| Florida | 0.83% |
| Georgia | 0.93% |
| Hawaii | 0.28% |
| Idaho | 0.75% |
| Illinois | 2.16% |
| Indiana | 0.87% |
| Iowa | 1.54% |
| Kansas | 1.41% |
| Kentucky | 0.87% |
| Louisiana | 0.51% |
| Maine | 1.19% |
| Maryland | 1.08% |
| Massachusetts | 1.13% |
| Michigan | 1.71% |
| Minnesota | 1.05% |
| Mississippi | 0.80% |
| Missouri | 0.94% |
| Montana | 0.85% |
| Nebraska | 1.76% |
| Nevada | 0.67% |
| New Hampshire | 1.86% |
| New Jersey | 2.47% |
| New Mexico | 0.76% |
| New York | 1.68% |
| North Carolina | 0.84% |
| North Dakota | 0.96% |
| Ohio | 1.57% |
| Oklahoma | 0.88% |
| Oregon | 0.87% |
| Pennsylvania | 1.55% |
| Rhode Island | 1.53% |
| South Carolina | 0.57% |
| South Dakota | 1.24% |
| Tennessee | 0.74% |
| Texas | 1.83% |
| Utah | 0.58% |
| Vermont | 1.78% |
| Virginia | 0.80% |
| Washington | 1.07% |
| West Virginia | 0.59% |
| Wisconsin | 1.94% |
| Wyoming | 0.61% |
Please note that these are average property tax rates and actual property tax rates can vary widely within a state based on local government assessments and other factors. It’s also worth noting that property tax rates can change over time as state and local governments adjust their tax policies.
As a homeowner, it’s important to understand how property taxes work and how they are calculated. The amount of property tax you owe depends on the assessed value of your property and the tax rate set by your local government.
An important practice I have annually is contacting my local GayRealEstate.com realtor (the person I bought my home from) and asking for comparable sales from the past year. This data allows me to challenge the estimate of value placed by the tax accessor, and inevitably lowers my tax bill! This one small effort can save you THOUSANDS per year in property taxes.
Jeff Hammerberg is a distinguished entrepreneur and broker, and the visionary founder of GayRealEstate.com. For over 25 years, he has been a prolific writer, coach, and author who has been instrumental in advancing the cause of fair, honest, and equitable representation for all members of the LGBTQ+ community in real estate matters. GayRealEstate.com, which he established, is the largest and longest-running gay real estate agent referral service in the nation, boasting over 3500 LGBTQ+ realtors who operate in cities across the United States, Canada and Mexico. His commitment to promoting inclusivity and accessibility in real estate has earned him a reputation as a passionate advocate for the LGBTQ+ community.
