Define Real Estate Property Taxes

Real estate property taxes are calculated based on your home's estimated value.

Real estate property taxes are taxes paid to your county on a semi-annual or annual basis. Most U.S. real estate owners have tax obligations for first and second homes. Taxes are calculated based on a percentage of each property's "tax assessed" value.

Basics

Real estate taxes are usually paid through an escrow account managed by your bank or mortgage lender. Taxes are part of a convention monthly PITI (principal, interest, taxes, insurance) mortgage payment. Most banks request your tax bill from your county and pay directly out of your escrow twice a year.

Obligations

Despite the fact that lenders typically take charge of making your tax payments from escrow, you as the homeowner are responsible for the payment. You will usually receive a tax statement from your county ahead of each payment due date. It is suggested that you confirm your bank's intention to make payment.

Benefits

Real estate property taxes are collected by counties for use in providing community services. Distributions are often made to localities (cities, towns). Your taxes help provide for street repairs, city snow removal, and other basic city and county maintenance and improvement programs.

References

• All Business: What You Should Know About Real Estate Property Taxes
• Welcome to Calvert County (Maryland): Pay Your Real Estate Taxes