New Property Assessments -> Property Taxes!

[Koolau]

However, if I decided to sell this house and buy one for an equal amount someplace else in the state, my taxes would be $10,000 a year. (1% of $1M) This is a BIG reason older residents do not sell their homes to downsize in California: the taxes would not make it feasible.

You would think such a high property tax would suppress the RE market - but since your house value has gone up 10X, I guess not. Prop 13 is great for long-timers, but new folks would need to think twice before committing to a large mortgage, large mortgage interest AND large RE tax. Still, folks are buying, so I guess it's all a matter of perspective so YMMV.

 

[cathy63]

...However, if I decided to sell this house and buy one for an equal amount someplace else in the state, my taxes would be $10,000 a year. (1% of $1M) This is a BIG reason older residents do not sell their homes to downsize in California: the taxes would not make it feasible.

Since Prop 19 went into effect a couple of years ago, that is no longer true. If you're over 55 you can take your old basis when you move. We used to have Prop 60 and 90 that allowed portability within the same county and between counties that signed up, but Prop 19 now allows it over the entire state.

 

[grasshopper]

Due to low interest rates and less income, it looks like I qualify for a 3 year freeze on the valuation on my property. The freeze is available to 65 and over owners living on the property.

First time in 7 years income has been low enough to qualify. Of course my taxes 2022-2023 were only up $20, so it isn't a game changer.

 

[skipro33]

Since Prop 19 went into effect a couple of years ago, that is no longer true. If you're over 55 you can take your old basis when you move. We used to have Prop 60 and 90 that allowed portability within the same county and between counties that signed up, but Prop 19 now allows it over the entire state.

Thanks for updating me on that. I didn't think it passed, especially with all the attempts of legislation to eliminate prop 13 for residential after commercial property is heading that way.

 

[skipro33]

You would think such a high property tax would suppress the RE market - but since your house value has gone up 10X, I guess not. Prop 13 is great for long-timers, but new folks would need to think twice before committing to a large mortgage, large mortgage interest AND large RE tax. Still, folks are buying, so I guess it's all a matter of perspective so YMMV.

Making money is easier in California in my opinion, than most other states. For example, a landscaper makes $100 an hour. Requires a contractor license to perform the work in this state, but damn!.... I think there's already a minimum wage law that surpasses Federal minimum and soon to come is a guaranteed living income law.

 

[Surewhitey]

Dallas County can raise your assessment as much as they want, but can only raise your tax 10%/yr. Thankfully they only raised ours the 10% & only assess every 3 years as I understand. 2.25% of assessment is steep for retired folk, but the 0% income tax is sweet for the worker bees.

 

[Surewhitey]

How do you find one of those firms that do the appeal for you? I know you can do it yourself, but those firms do it in all situations and know what works and what doesn't. The documentation I might assemble might seem good, but might suffer from non-obvious flaws. I'd rather hire the service.

I found one through looking at DD tax record & their company name was listed. Went to their website and filled out the info & they declined due to viability of success as I'm the smallest house (& stated value) in the area.

 

[karen1972]

Our assessments only moved slightly. I figured out thats because of how they do assessments.

In our area, its new development, so they have us grouped by phase of development at the assessors office. When I went to try to lower it a few years ago, they would only allow me to select homes in my phase and not those across the street in Phase 1 so its set up that way by the software.

This creates a weird situation because lots of homes in Phase 1 and Phase 3/4 sold in the last 2 years and at much higher prices. The last home in our phase sold over 2 years ago, so while our assessments stayed low, everyone else in the subdivision skyrockets.. so basically luck of the draw.. we will catch up when/if people sell, for now its saving us about $500/yr by everyone on our street just staying put.

 

[wmc1000]

Our 2023 assessment just posted with a 34% increase, from $281,100 to $380,400. Since this assessment won't be taxed until 2024 it will be interesting to see what the millage rate decrease is next year.

2022 payable 2023 annual tax is $1296.26

 

[Ablatus]

In Florida they limit the annual increase in the assessed value of homesteaded properties to 3% or the change in the National Consumer Price Index (CPI), whichever is less. [emoji41].

Living in CA, Prop 13 is keeping me from moving. I really want to leave the state, though. I have ventured to Knoxville and love it but I am just researching property taxes. I have been retired 10 years and have two more years for to 65. Does anyone know where property taxes are forgiven or deferred for seniors? I believe Alabama and maybe Texas. Any others?

 

[CAO1025]

Chicago taxes

I just got notice in my Chicagoland suburbs for the triennial assessment, that my assessed valuation is going up 30%

 

[Gumby]

Living in CA, Prop 13 is keeping me from moving. I really want to leave the state, though. I have ventured to Knoxville and love it but I am just researching property taxes. I have been retired 10 years and have two more years for to 65. Does anyone know where property taxes are forgiven or deferred for seniors? I believe Alabama and maybe Texas. Any others?

I wouldn't base my decision on where to live on the property taxes. There are places that have low taxes, but for a variety of reasons they might otherwise be miserable.

 

[troutnut1]

I just got notice in my Chicagoland suburbs for the triennial assessment, that my assessed valuation is going up 30%

An interesting number to be sure. But completely worthless for predicting taxes since you don’t know the other parts of the equation.

There are only three things you need to ask yourself about an assessed valuation.

1. Is it right?
2. Is it wrong?
3. Do I even know if it’s right or wrong?

If it’s right, it’s right. No action required. We hope that the budget stays the same or goes down, and the mill levy is reduced to bring in the same amount, or an amount that doesn’t result in a significant increase in actual taxes. Taxes very often go down even with increased values. But nobody ever remembers that. They always remember tax increases.

If it’s wrong, you should probably do something. This usually starts with a call to the appropriate taxing jurisdiction to find out the process to getting it adjusted.Often this is pretty simple and doesn't require a formal appeal.

If you don’t know, you should find out. Often the best bet is to call the taxing jurisdiction and just ask to see whatever evidence they might have supporting their valuation. Realtors and services like Zillow can also be handy in figuring this out too. HINT: If there is any chance it may be lower than market, check that out to be sure BEFORE you call the taxing authorities. We don’t want to wake up any sleeping dogs if its low.

IMPORTANT: All appraisals of any kind must specify the date of the valuation. Since markets are always changing, their valuation, and any evidence you might uncover, must be adjusted to that same date. This goes by many names, but is always a date specified by law for your assessment.

 

[Out of Steam]

Interesting how it’s done in various locations. Every 3 yrs here in MD. Very expensive here. No cap on assessments but a 10% ish cap on taxes. There’s another limit (constant rate) that keeps the state/county from reaping a windfall due to property appreciation. The increase is phased in 1/3 per year.

We used to live in Maryland, and one interesting thing there is how much property tax rates vary within the state. We lived in an area of Montgomery that was not within a city, and the rate was fairly reasonable, no more than 1%.

We looked into moving within the state a couple of times, and being within the limits of a city, or in another county, changed that number substantially. The City of Frederick seemed particularly egregious.

 

[SJhawkins]

How about a I really don't walk to talk about it

 

[troutnut1]

I wouldn't base my decision on where to live on the property taxes. There are places that have low taxes, but for a variety of reasons they might otherwise be miserable.

All states and taxing jurisdictions have taxes, but there are dozens of ways to get them. And property taxes are just one way. It wouldn’t make sense to move to a state where you save $2,000 in property taxes only to find out they have a huge income tax and massive sales tax that cost you $20,000 a year. The time to find out these details is before you move there.

For this type of research I like TaxFoundation.org as they can see what the total tax bite is in each state you are considering.

By the way, tax schemes like Proposition 13 don’t cost the state or counties money. They just transfer the tax burden to neighbors and friends. So identical houses next door to each other may have taxes that are wildly different. First one in the gate wins. California residents (I was one at the time) in the 70’s successfully passed laws that reduced their taxes, and transferred them to future neighbors and future generations. The taxes they would have normally paid are now transferred to the new neighbors who just bought and must now pay many times the tax rate of the person who moved in 30 years ago. In California this is loved by seniors that have been there forever and is considered fair and just. In Montana this would violate the state constitution which requires that all property taxes be based upon 100% of market value, and that taxes must be fair and equitable. Realize that different states often have completely different views as to fairness and charity towards certain populations like us seniors. You probably need to determine those rules and economic climate as well before you move someplace.

 

[rk911]

Living in CA, Prop 13 is keeping me from moving. I really want to leave the state, though. I have ventured to Knoxville and love it but I am just researching property taxes. I have been retired 10 years and have two more years for to 65. Does anyone know where property taxes are forgiven or deferred for seniors? I believe Alabama and maybe Texas. Any others?

if you look up the addresses of the properties you're interested in on Zillow you'll find the latest property tax information.

 

[troutnut1]

if you look up the addresses of the properties you're interested in on Zillow you'll find the latest property tax information.

Be VERY wary of that information. I just sold a $780,000 home in California but the property tax showing on Zillow was based upon our purchase price in 1975 (about $2000 annually) The new owners taxes will be based on the new price paid and will be over 500% higher (over $10,000). And many states show discounted taxes for homeowners, military, seniors, low income, etc. etc. making this information wrong unless you qualify for exactly the same discount program. Listing information from Realtors is also often unreliable for the same reason.

 

[jazz4cash]

We used to live in Maryland, and one interesting thing there is how much property tax rates vary within the state. We lived in an area of Montgomery that was not within a city, and the rate was fairly reasonable, no more than 1%.

We looked into moving within the state a couple of times, and being within the limits of a city, or in another county, changed that number substantially. The City of Frederick seemed particularly egregious.

We haven’t noticed much difference but we are in one of the highest taxed jurisdictions. Our subdivision is 20 yrs old and straddles 2 counties. The builder showed property tax examples for both counties. You know it’s pretty hard to compare property taxes between counties except in this rare situation. It was a bit of a shock to see taxes were lower in the more desirable county (Montgomery). Over time the assessments in the more desirable county would likely exceed the difference in millage rates.

Our neighbors across the street moved from NJ and think the property taxes are a great bargain.

 

[Accidental Retiree]

Living in CA, Prop 13 is keeping me from moving. I really want to leave the state, though. I have ventured to Knoxville and love it but I am just researching property taxes. I have been retired 10 years and have two more years for to 65. Does anyone know where property taxes are forgiven or deferred for seniors? I believe Alabama and maybe Texas. Any others?

My friend in northern Georgia had her RE taxes drop from about $2400/year to $600/year after she turned 65.

There’s some sort of senior tax break there. Georgia looks tax friendly for those of us 65 and older.

 

[Dtail]

With our homestead status in FLA, our taxes can only go up a maximum of 3% yearly.
However since we bought the house in 2019, we are still paying more than all our friends in the development.

 

[brucethebroker]

Personally, I have always considered property taxes a wealth tax. I agree that funding for schools, libraries, social services, etc. has to come from somewhere, but those with larger, higher assessed homes do not automatically use those services more than folks in more modest abodes.

It is also frustrating to see the attitude of some making taxing decisions. A dozen or so years ago, our state legis. put a % cap on the total tax, based upon assessed value. One would think that would make comparisons easy. However, while doing property research, I noticed some large discrepancies in similarly assessed homes in the same neighborhood. I called the county assessor office pointing out the % issue, and was told that the fine print of the law only covered the basic home sq. footage, and that larger garages, basements, out buildings (including garden sheds) and pools were fair game at a much higher, non capped rate-regardless of the assessed value. Pretty frustrating.

 

[CaptTom]

Personally, I have always considered property taxes a wealth tax.... those with larger, higher assessed homes do not automatically use those services more than folks in more modest abodes.

Very true. But the word you're looking for is progressive tax. For most of US history, this would have been considered unconstitutional. But the idea that those who have more should pay more tax kept popping up. That biblical thing about "to whom much is given" and all. The fourteenth amendment codified it into law. You can agree or disagree with the premise, but it's widely accepted now.

It is also frustrating to see the attitude of some making taxing decisions...

Full agreement here. Making taxing decisions at the lowest level of government allows for all kinds of abuse. Municipalities are in a continual battle to try to collect as much as they can to support all the services and programs the citizens demand. It's not surprising that they turn to every trick available to them to get more. And don't even get me started on HOAs and condo associations. I'm not sure I have a good solution.

 

[VanWinkle]

I wouldn't base my decision on where to live on the property taxes. There are places that have low taxes, but for a variety of reasons they might otherwise be miserable.

And doing the same thing over and over again expecting a different result is not the best way to achieve satisfaction. I've been paying the 2nd highest property taxes in the country(Illinois) for 44 years and services have declined steeply over that period.

VW

 

[ERD50]

Originally Posted by brucethebroker View Post
Personally, I have always considered property taxes a wealth tax.... those with larger, higher assessed homes do not automatically use those services more than folks in more modest abodes.

Very true. But the word you're looking for is progressive tax. For most of US history, this would have been considered unconstitutional. But the idea that those who have more should pay more tax kept popping up. ...

I don't think that is the generally accepted definition of a "progressive tax", is it?

My understanding is that a progressive tax is one where the rate becomes progressively higher, like Fed income tax, with higher % brackets the more you make.

But something like a sales tax is a flat %. So if you buy something for $1,000, you pay 2x the tax that you would for for a $500 purchase. But the rate is the same, so it is not considered 'progressive'. Aren't property taxes usually a fixed rate?

I'm surprised that there isn't a bigger push for a true progressive rate for property tax, .... I'll leave it at that.

A fixed amount per home, regardless of the value of that home - the only term I know for that is a 'head' tax - must be another one?

-ERD50