Property Taxes by State

Apart from conventional income tax, that is collected by tax collection agencies, local and regional governments also collect other taxes such as property tax. Here is a brief elaboration of the concept of property taxes by state governments.
A property tax is basically an ad valorem tax. All real estate or property owners are subjected to property taxes by townships, counties or local-level government authorities. These taxes vary and are based on the property tax rate, and the said properties' assessed value. A few exemptions and deductions can be availed by certain real estate owners. Barring such instances, almost all real property is subject to property tax. In addition to standard tax on real estate, it also extends to some valuable assets such as yachts, expensive collector goods, business inventory etc.

Property Taxes by State

StateProperty Tax (Average)
Alabama$503
Alaska$1,728
Arkansas$549
Arizona$1,119
California$1,465
Colorado$1,277
Connecticut$2,473
District of Columbia$3,035
Delaware$712
Florida$1,589
Georgia$1,092
Hawaii$983
Iowa$1,305
Idaho$813
Illinois$1,777
Indiana$1,124
Kansas$1,353
Kentucky$663
Louisiana$702
Massachusetts$1,873
Maryland$1,205
Maine$1,640
Michigan$1,234
Minnesota$1,210
Missouri$2,625
Mississippi$793
Montana$2,625
North Carolina$867
North Dakota$1,165
Nebraska$2,625
New Hampshire$2,625
New Jersey$2,625
New Mexico$606
Nevada$2,625
New York$2,136
Ohio$1,135
Oklahoma$597
Oregon$1,172
Pennsylvania$2,625
Rhode Island$2,019
South Carolina$970
South Dakota$1,111
Tennessee$748
Texas$1,475
Utah$863
Virginia$1,481
Vermont$2,056
Washington$1,226
Wisconsin$1,633
West Virginia$709
Wyoming$2,285

(Please note that the tax figures, mentioned here, are indicative of the amount an individual needs to pay. These have been compiled by averaging the collections per capita. Taxes vary substantially, as the market value of the property depends on the evaluation made by the assessor.)

The property or real estate taxes that are levied by state, are usually collected by the Department of Revenue, of that particular state. This tax is considered to be one of the biggest sources of income in almost all states. These taxes are basically used in order to fund the welfare activities such as construction of public amenities by states and local government. A tax assessor determines the value of a particular house or any real estate. There are two basic constituents of the property that are considered by the assessor. These are:
  • The actual site value of the building according to original prices and actual market prices.
  • Home improvements and upgrade of the house. The upgrade factor is always considered to be an addition to the cost of the property.
The tax assessor is basically a public officer, however there are also some certified tax assessors who operate privately. The office of tax assessors, often maintain 'tax maps' that record and keep tabs of the rates of market prices as well as value-added improvements in the property. Apart from the tax maps, assessors also use the Assessors Parcel Numbers, which are unique identification numbers that help them and also taxpayers in tax filing processes. These tools are basically used to conclude the value of the property on which a specific tax rate is levied.

Facts About Property Tax
  • The rate of taxation is a percentage that is prescribed by the state and applied to the value of property, that is evaluated by a tax assessor.
  • The total amount of real estate tax that is paid to the state, becomes a valid ground for income tax deduction, according to IRS forms.
  • On an average, real estate tax by state is used for public welfare services, by the state government. For example, in the state of Texas, this tax is used to fund public schools.
  • The rate of taxation can go as high as 1.74% of the home value (for the state of New Jersey) and can also be as low as 0.14% (state of Louisiana).
  • The commercial property tax may have some different terms and conditions for assessments as the property is used solely for the purpose of making profit, by giving it out for rent. The same goes for business property tax, as the property is used for the purpose of business operations. The industrial properties is another story, as it is used for production purposes. Thus, the purpose of the property, is also an important factor, when it is being assessed.
  • The property tax changes every year as it is not under federal jurisdiction, and the amount of tax depends on the assessment of your real estate.
While filing for a property or real estate tax, it is essential to follow the guidelines that have been issued by the state. It is also recommended that you file for a tax deduction with the IRS on the basis of property tax that has been levied by the state. It can be concluded that the better the condition of your house in terms of home improvement, the better are your tax filing forms, as it shows a greater assessed value of the property and at the same time, home improvement costs become excellent grounds for itemized tax deductions of the IRS.
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