Property tax, or real estate tax, is a regressive tax calculated by the local government to determine the assessed value of real estate or personal property. The tax rates primarily begin with your state’s rate baseline and depend on where you live. Real estate taxes typically get used for community and public services such as school funding, parks, or roads.
The taxes are based on the Limited Property Value, in which a cap is placed on the property’s taxable value, ensuring the tax increases are reasonable and predictable. The regressive taxation system of property taxes applies a uniform tax regardless of income. However, property taxes are based on the property’s value and are not wholly regressive.
For questions and additional support on your property’s taxes, contact V.I.P. Mortgage, Inc. and we’ll set you up with a qualified loan officer who can help.
Sources:
Byas, Kristina. “Property Taxes: What Are They & How to Calculate.” Edited by Libby Wells, Bankrate, 26 Aug. 2022, www.bankrate.com/real-estate/property-taxes/.
“Property Tax FAQs.” Property Tax FAQs | Arizona Department of Revenue, azdor.gov/business/property-tax/property-tax-faqs. Accessed 29 Aug. 2023.
Reekmans, Katharina. “Everything You Need to Know about Property Taxes.” The TurboTax Blog, 9 June 2022, blog.turbotax.intuit.com/tax-planning-2/everything-you-need-to-know-about-property-taxes-50240/.