What Is Property Tax Assessment?

Property taxes are imposed on homeowners by counties and cities throughout the United States. While each jurisdiction has its own method for calculating the tax, it is most commonly based on the assessed value of your property. The property tax assessment is used to determine how much your property is worth compared to the other homes in the area, for taxing purposes only.

Property Taxes

Taxing jurisdictions rely heavily on the revenue generated from property taxes to fund various services such as public schools and police departments. Property tax rates vary drastically across the country ranging from a few hundred dollars per year to tens of thousands. Larger cities and the surrounding areas tend to have higher property taxes than rural locations. Taxes are typically due once or twice a year, and failure to pay them on time can result in a lien filed against your property. Even though paying the tax might present a burden for some, homeowners enjoy a deduction on their federal tax return for eligible property tax payments.


Tax collectors determine the amount of property taxes you owe by applying the standard tax rate to the assessed value of your property. Various methods are used to determine the assessed value nationwide; however, all properties within the same jurisdiction should be assessed the same way. An assessed value can be determined by reviewing public records of the deeds and mortgages on your property to obtain the purchase price. In some places, an assessor will visit the property to make an estimate of its value. This is generally only done from the outside, which means the estimate might be inaccurate if the exterior of your house appears more expensive than the interior, or vice versa.


Tax collectors complete reassessments as necessary, and your tax bill is likely to increase over time. Some municipalities do this every year, while others reassess every few years. Like the typical assessment, the reassessment is monitored by the individual tax jurisdiction. In certain areas, like California, your tax assessed value can only increase by a certain percentage each year for the entire length that you own your property. Other tax collectors preform new assessments every few years, regardless of whether the property's been sold or the same owners live there.


In some cases, a homeowner may not agree with the property tax assessment. Some tax collectors have an appeals system in place to help resolve this issue. If successful, the assessed value of the property might be lowered. The appeals process is specific for each jurisdiction, so you need to contact your tax collector for more information and instructions on how to submit an appeal.