How to Read School District Property Taxes
Perhaps the only thing more frustrating than realizing that once again you will be experiencing another increase in your property tax bill is trying to figure out the meaning of the many abbreviations and millage breakdowns. As tempting as it may be to simply pay the bill without understanding the assessment it is vital that you take the time to understand your property tax assessment. You may have a limited amount of time to protest the assessment and by not understanding this important document you may not realize you are being over-assessed until it is too late to do anything about it.
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Instructions
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Make sure to have an understanding of how millage is calculated. A millage is a tax rate on property, expressed in mills per dollar of value of the property. A single mill represents $1 of tax for every $1,000 of assessed value. For instance, if your property has a net assessment of $100,000 and your local common education school receives 10 mills of ad-valorem tax then you would likely be assessed $100 for that local school district.
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Do not confuse the gross property tax assessment with your net property tax assessment. The gross valuation should reflect the true value of your property should you take it to the market in order to sell it. Depending on your locality the local laws may call for the millage tax to only be applied to net property tax assessment. The net assessment may account for deductions such as a homestead exemption. Local laws may also allow for a deduction in the percentage of assessed value to which the millage rates are subsequently applied. For instance, a $100,000 property's net assessed valuation may be 20% of the gross assessed value prior to the inclusion of any deductions such as homestead exemption. In this case the property would be taxed on $20,000 of value minus the amount allowed for homestead exemption. The local assessor's office should be able to indicate if this is the case for your locality.
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Carefully review the assessment to understand how your property taxes are distributed. The tax may be distributed to a variety of government institutions and your statement should indicate how many mills each institution receives.
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Conduct a review of the possible deductions that may be available to you and which you may not be taking advantage of. Some locations may allow for deductions such as reductions for senior citizens who are living on limited incomes.
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Tips & Warnings
Be sure to remember that the local assessor's office may have a narrow window of time established in which you can protest your assessment. If you find that your property has been over-assessed it is vital for you to immediately place the assessment officials on notice that you will be protesting the assessment. Failure to protest within the established time period could leave the property owner with few options in order to realize a fair assessment.
