Help With Property Taxes: A Beginner’s Guide

Did you know that the average American pays $2,471 in annual property taxes? While paying taxes may not be the most exciting part of owning a property, it’s important that you pay your property taxes to avoid legal trouble. 

If you’ve never owned a property before, however, you might find that property taxes just seem… confusing. 

How much do you pay? Where do you pay? What’s the money for? 

We’ll answer these questions below. Keep reading to get some help with property taxes that will help you as a new homeowner. 

Understanding What Property Taxes Are For

Property taxes are paid by someone that owns a property based on the value of that property.

These taxes are usually levied by state or local municipalities, and the funds are used for schools, neighborhood or state facilities, and other projects that are meant to benefit the community.

Because these are so specific to the location you live in, the amount you’ll have to pay is going to vary widely from state to state (and city to city). 

You can contact your local treasurer or county office to figure out how to pay. Some municipalities will allow online payments while others still require mail-in or in-person payment options. 

Determining What You Owe 

The formula to estimate what you’ll owe in property taxes is:

Assessed Value of Property x Tax Rate = Property Tax 

Unfortunately, there are a lot of factors that go into this equation, so the answer to this general formula may not be completely and entirely accurate. It will give you a basic idea of what you can expect, however, which might still be helpful. 

You can use a property tax calculator to figure out what you owe as well, which is likely to be a little bit more accurate.

You may think that states with lower costs overall will automatically have lower property taxes. Some of the states with the lowest property taxes, however, may still have extremely high costs of living (like Hawaii), so you can’t always use that as an indication of how much you’ll pay. 

Additionally, if you’re doing a rent-to-own situation on a house, the seller will pay property taxes while they still own the home. Look into rent-to-own vs. mortgage options if you’re concerned about property taxes so that you know where you’ll be held liable.

Getting Professional Help With Property Taxes

You may want to talk to an accountant or a lawyer to get additional assistance. If you’re concerned about your property taxes or have had an issue with payment, you need to rectify the situation fast to avoid further consequences, like fees or even jail time. 

If you find that paying your property taxes is difficult, there are government programs designed to help in specific situations. You may not be eligible for all programs, however, so doing research and speaking with your government offices is essential. 

Pay Your Property Taxes With Ease

Now that you understand more about why you pay property taxes, you might feel more at ease about actually paying them. Remember to figure out how much you owe, where you pay, and where the money goes so that you know your money is heading to the right spot.

If you need to get further help with property taxes, remember that lawyers and accountants know the ins and outs of how they work, so they can provide you with more guidance! 

Check out the rest of our blog for additional information on taxes, being a homeowner, and more.