Property Tax is a recurring tax levied by local government authorities on the assessed value of real estate, used to fund public services such as schools, roads, and emergency services.
For most homeowners, property tax is one of the largest ongoing costs of ownership after a mortgage payment. Local assessors estimate the value of your home, typically on an annual or periodic basis, and apply a tax rate (often called a mill rate or levy rate) to calculate what you owe. If your home is financed, your lender will commonly collect property tax payments as part of your monthly mortgage payment and hold the funds in an escrow account, paying the tax bill on your behalf when it comes due. Homeowners who own their property outright are generally responsible for paying the bill directly, often in one or two installments per year. Rates and assessment methods vary considerably by county, city, and state, so costs can differ significantly from one location to another.
Watch for: Your assessed value is not always the same as your home’s market value or appraised value. Many jurisdictions allow homeowners to appeal an assessment they believe is inaccurate, and some offer exemptions, for example for primary residences, seniors, or veterans, that may reduce your bill. Eligibility rules vary widely, so check with your local tax authority for details. HomeRule does not provide personalized tax or legal advice.
See also: Escrow Account, Assessed Value, Homestead Exemption