Property taxes are an inevitable part of owning real estate. Although there are ways to reduce the amount of property tax you owe, everyone is obligated to pay them unless they own their home outright without any mortgages or liens. However, this obligation does not mean that it’s always easy to understand how your property taxes work. There are several steps you can take, though, to make it easier for you to keep track of your property taxes on a yearly basis.
1. What Are Property Taxes?
Property tax is the amount of money you pay to your local government for the privilege of owning property. The money that you give to the government usually goes towards things like public schools, libraries, police departments, fire stations, governmental staff salaries, road maintenance and repair costs, etc.
Depending on where you live in the world there are different ways that you can be taxed, the most common being a flat rate, where everyone pays the same percentage of their home’s value. Going into detail about the Texas property tax code, https://www.propertytaxloanpros.com/texas-property-tax-code/ showcases that while there are usually many sections or subtitles in the tax code, there are always ones that you need to pay special attention to. Among those are sections about general provisions, property tax administration, taxable property and exemptions, appraisal and assessment, collections and delinquency, as well as remedies.
Again, depending on where you live, you might find different headings for these, and you should always read the document in its entirety, but these would be the most important parts that could affect you.
2. How Do I Know What My Property Tax Bill Will Be?
Your property tax bill is a breakdown of all the taxes you owe to the government, based on your home’s value and what kind of exemptions you have – i.e. Senior Citizen, Disabled Veteran, Surviving Spouse, etc. Property taxes are usually influenced by the location of your home, so when looking for the right place to buy your dream home, this is something you should keep in mind. A higher value of property close to a city center will usually be more expensive than one far away in the outskirts.
To find out what your bill will be you can go to the county’s website and search for a taxable value estimator. From there, enter the details of your home, click “submit”, and it should give you an estimated amount of how much tax you will owe. If you prefer to do it by hand, you can just multiply the total assessed value of your home by the tax rate. The tax rate is usually stipulated in the tax code.
3. When Do I Pay My Property Taxes?
Your property taxes are typically due in two installments unless the tax code specifies otherwise. One half is due at the beginning of December and one half is due by the end of May or the beginning of June. If you do not pay them on time then you could be subject to paying a late fee, which often depends on how much money is still owed after a certain period of time. The more you owe, the higher the late fee will be. This is where the remedies section of the code could come in handy if you need to contest the amount of money that you owe.
While you are making your payments it is also important to keep track of them in case there are any errors. If you find that you have been overcharged then you can petition the tax assessor who will review your situation and hopefully adjust your bill so everything is right again. If you know that you are not going to be able to pay your taxes then it’s best to try and contact the tax assessor’s office as early as possible so they can give you all of your options.
4. How Do I Pay My Property Taxes?
Again, depending on where you live, this could differ from county to county, but there are usually a few ways that you can pay your property taxes. You can pay your property taxes through whatever method that your municipality specifies as accepted payment. You can either mail it in with a stamp or use a pre-paid envelope, or you can go in person either to the county treasurer’s office or to your school district office. You can also check online for up-to-date forms needed depending on the type of property you have. Most commonly, you’ll see that everybody pays their property tax with a cheque.
5. How Can I Save On Property Taxes?
There are many ways you can save on your taxes, but here are some of the big ones. If you’re purchasing a newly built home, you could qualify for property tax exemptions for the first year to help lower closing costs. Exemptions include homestead exemptions, senior exemptions, veterans’ exemptions, disabled occupants’ exemptions, and more. You can also look into reclassifying or reassessing your property both of which would involve hiring a lawyer to help you with the process.
You can also lower your tax bill by making improvements to your home such as energy-efficient upgrades like adding insulation and/or new windows. You can also get help from organizations that work to provide affordable housing to low-income families using volunteer hours in place of payment.
6. What Are Supplemental (Special) Assessments?
A supplemental assessment is an additional charge on top of any annual property taxes you already owe for things like road repair, bridge repair, flood control procedures, etc. These are billed to you if they are not included in your existing property tax bill and they can come as a result of something that you didn’t have any control over such as an infrastructure improvement. If these supplemental assessments are not included in your annual property tax bill then they may be billed directly to the owner of the land or they may go to the tenant if it’s rented.
These shouldn’t be that much of a burden to pay if your property taxes are already covered. However, if they’re not covered then you could be in some trouble because these bills can add up quickly. For this reason, it’s important to familiarize yourself with any planned infrastructure improvements in the area where you live so that you know what these charges will be for and how much they might cost in the end.
You have to pay property taxes for one simple reason: your local government wouldn’t have enough money to function without them. While you might see your property tax bill as extra money to pay each year, many would agree that this cost is well worth the benefits. Your home is an integral part of your life, and the value of your home is an important financial consideration that can affect everything. For this reason, it’s important to take steps to become familiar with how property taxes work, especially if you’re looking to purchase a new home or sell your old one.
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