Real Estate Taxes

Buying a home might have an affect on real estate taxes that you may not be prepared for. Don't have one of the happiest events of your life be dampened by unpleasant surprises when you get your tax bill.

Here are 8 Real Estate Tax Questions You Need to Ask before buying your new home.

1. What is the assessed value of the property? Note that assessed value is generally less than market value. Ask to see a recent copy of the seller’s tax bill to help you determine this information.

2. How often are properties reassessed and when was the last reassessment done? Generally taxes jump most significantly when a property is reassessed.

3. Will the sale of the property trigger an increase in property taxes? Often the assessed value of the property may increase based on the amount you pay for the property. And in some areas, such as California, taxes may be frozen until resale.

4. Are the taxes comparable to other properties in the area? If not, it might be possible to appeal the tax assessment and lower the rate?

5. Does the current tax bill reflect any special exemptions that you might not qualify for? For example, many tax districts offer reductions to those 65 or over. You might be eligible for a reduction through the Star Program. If you are a veteran, you are eligible for a reduction as well.

6. What is the effective date for assessed values?

7. What is the level of assessment to market value (ratio) required by state or provincial tax laws?

8. What time period did the assessor study comparable sales before establishing assessments?

The last 3 questions were submitted by Richard Sanderson. He is a tax assessor in Maryland. If you want more information about this subject, go to his Blog called Property Assessment. It's very informative.

It's worth putting the time into this research and preparing whatever documents are needed to minimize your tax burden.

If you would like to discuss this further, contact me about real estate taxes by clicking here.

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