How this calculator works
US property tax is set and collected locally. The assessor values the property, an assessment ratio converts market value into assessed value, exemptions reduce the taxable value, and each taxing district applies a mill rate. One mill is one dollar of tax per $1,000 of assessed value, so a 20 mill rate is 2%. This model multiplies the taxable value by the mill rate and divides by 1,000. Assessment ratios, exemptions and mill rates differ by county, city, school district and property type, and some states assess at full market value while others use a fraction. The model assumes one mill rate for the whole bill and leaves out homestead and senior exemptions, caps and circuit breakers, special assessments, tax increment districts and any change in value after the assessment date. It is not a bill.
Formula
Assessed value = market value x assessment ratio. Taxable value = max(0, assessed value - exempt value). Annual tax = taxable value / 1,000 x mill rate. Monthly amount = annual tax / 12. Effective rate = annual tax / market value.
Worked example
A home with a $400,000 market value at a 100% assessment ratio has a $400,000 assessed value. A $50,000 exemption leaves $350,000 of taxable value. At 20 mills, the annual tax is $350,000 / 1,000 x 20 = $7,000, or $583.33 a month, which is 1.75% of market value.
Frequently asked questions
What is a mill?
A mill is one dollar of tax for every $1,000 of assessed value. Rates are often written as mills rather than percentages, so 25 mills is the same as a 2.5% rate on assessed value.
Why does the assessed value differ from the market value?
Many states assess only a share of market value. Enter the ratio your county uses, or set it to 100% when property is assessed at full value. The ratio can also change with property type.
Is this my actual tax bill?
No. It is an estimate from the three local figures you enter. Your bill depends on the official assessment, the exemptions granted and the rates set by every taxing district, which can change each year.
Does the monthly amount go into escrow?
A mortgage servicer often collects one twelfth of the annual tax each month and pays the bill when it is due. The monthly figure here is that simple average, not a projection of a changing assessment or rate.