What is the assessed value?

An assessed value is a particular value assigned for a property that helps in taxing purposes. It is calculated with the help of sales comparables of various neighboring properties. It is assigned by the state or local government to calculate the property taxes of that particular property. An assessor directly inspects the property and he is completely responsible for assigning the values of the property.

How does it work?

An assessor inspects a property that you own and comes up with $300,000 as of the assessed value of your property. Every county sets a tax percentage for every year. The tax rate for the respective year is given as 4% in your particular county. The tax rate of 4% is applied on $300,000 and the property tax calculation for the year will be $12,000. The $12,000 is the tax amount that you need to pay for that respective year.

Every state has its own set of rules for calculating the assessed value but they are bound to the same primary values of comparing home sales, location data. The assessment value is calculated on an annual basis for many jurisdictions. The fair market value is different from the assessed value of the property. The assessed value of property tends to be a bit lower than the fair market value of that particular property. 

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How the assessed value affects your property tax bill?

The assessed value of your property has nothing to do with decreasing the market value of your property.  It will decrease if you are an owner occupant and you have a higher chance of a reduced property tax bill. The assessed value is only a part of the fair market value. The following equation is used for property tax calculation:

property tax calculation texas

When you have a reduced assessment ratio, it has more chances to reduce the tax bill. Your property tax bill is also calculated based on the type of your property such as

  • Agriculture
  • Residential
  • Commercial
  • Office
  • Apartment
  • Vacant land
  • Warehouse

Apart from these factors, property square foot, type of construction, age of the property and even location helps to calculate your tax bill.

Why pay property taxes?

Are you thinking about why should I pay property taxes this year? Then the answer is very simple. There are chances for you to even lose your property if you don’t pay. You can opt for tax relief and even protest for higher tax bills that you have received with O’Connor – Property tax reduction experts.