Property Tax Rates vs. Property Tax Assessments
Friday, February 26, 2016
What’s the difference between property tax rates and property tax assessments? What difference do they make on your actual property tax bill?
There are constant stories in the media talking up tax breaks and caps, but then there are tax assessments. This make can figuring out what your tax bill should be, and if any promised breaks will provide any real help or not really challenging. So how are they different, how can NY property owners effectively lower their taxes?Property Tax Assessments
Tax assessments are what is used to calculate your tax bill. The assessed value is what the county property appraiser and tax assessor deem your property is worth. If you and a neighbor have the same tax rates, the one who has the high tax assessed value pays more tax, and vice versa. These assessed values are based on square footage, bedroom counts, location, and other major features. If you substantially improve your home or put on an addition your assessed value will go up. The same is true if other local homes sell for more money.Property Tax Rates
Property tax rates are made up of multiple fees to support government, schools, and more. Tax rates are set every year based on the county budget. When local government needs more money tax rates go up. Long Islanders have seen these rates steadily going up.It’s a Wash
These two dueling factors mean that property taxes inevitably continue to rise. Annual caps on rate increases don’t mean much if assessed values go up by far more. NYC property rose to being assessed at $1T in early 2016. New data shows that the value of NY metro area construction contracts rose 55% in January 2016 alone. New higher priced property sales push up neighbors assessments. The New York Senate recently passed legislation to lift the income eligibility for seniors’ tax exemptions
for the first time in 22 years. Of course living costs and property taxes have gone up substantially since then, and new higher assessments may easily dwarf any breaks. In the end it is often a wash. It sounds good in the headlines, but many property owners only continue to see higher bills in their mailboxes.
If you want to lower taxes claim your breaks, make sure your assessment is correct, and challenge suspiciously high bills with the help of a local property tax adjuster.