How to Read a Property Tax Bill. Property tax is usually calculated by and paid to the local government of the county or municipality where your property is located. As a property owner, it is essential to understand how to read a property tax bill. Doing so will help you learn more about the way your property taxes are calculated and will ensure that you pay the correct amount on time.
Look closely at your tax bill and check for a number referred to as the property index number. It is usually listed towards the top portion of the bill and refers to the type and legal description of your property. Make sure that this information is correct before proceeding with paying your property tax bill.
Locate the official amount of the assessed value of your property on your property tax bill. This amount is calculated by your local government, usually at the county level, and is based on the estimated value of both the building itself and the site or plot of land where the building is located. This amount reflects the value that the assessor believes your property would sell for if put up for sale on the open market on the date of his assessment.
Examine the information listed about the taxing districts included in your local government's constituency, which will collect a portion of your property tax payment. This information is provided to give you an idea of how your tax money will be used by the local government to fund different areas of the community. Usually, both the previous year's tax rate and the current tax rate for each district will be listed, as well as the percentage of your total required payment that will go to each district.
Inspect the payment stubs attached to the bottom of your property tax bill. Each stub should include the official property index number assigned to your property, the amount of each payment installment required and the due date for each payment. Read each stub carefully to make sure that the information listed appears to be correct, and then mark your calendar with each of the payment dates and the amount due on each date.
Consult a tax lawyer with any questions that you may have about how to read your tax bill. Find a lawyer who specializes in property tax and will be able to guide you through the payment process. Though your lawyer will charge you a fee for these services, it is worthwhile to ensure that you are not being asked to pay more than should be required by your local government for your property.
It is extremely important to pay your property tax bill on time to avoid negative consequences. In most states, late payments are subject to a penalty fee or may even result in the property being sold to a new owner through an auction organized by the state.
- Corporate Finance Institute. "Ad Valorem Tax." Accessed Feb. 4, 2020.
- Tax Foundation. "Property Taxes." Accessed Feb. 4, 2020.
- Internal Revenue Service. "General Instructions for Certain Information Returns." Accessed Feb. 4, 2020.
- Tax Foundation. "Tangible Personal Property." Accessed Feb. 4, 2020.
- It is extremely important to pay your property tax bill on time to avoid negative consequences. In most states, late payments are subject to a penalty fee or may even result in the property being sold to a new owner through an auction organized by the state.
This article was written by PocketSense staff. If you have any questions, please reach out to us on our contact us page.