How do property taxes work?
Property taxes are what most
homeowners in the United States pay for the privilege of owning a piece of real
estate, on average 1.5 percent of the property's current market value. These
annual local assessments by county or local authorities help pay for public
services and are calculated using a variety of formulas.
Are property taxes deductible?
Property taxes on all
real estate, including those levied by state and local governments and school
districts, are fully deductible against current income taxes.
can I learn more about appealing my property taxes?
Contact your local
tax assessor's office to see what procedures to follow to appeal your property
tax assessment. You may be able to appeal your assessment informally. Mostly
likely, however, you will have to go through a formal tax-appeal processes,
which begin with an appeal filed with the appropriate assessment appeals
What is an
An impound account is a trust account established by the
lender to hold money to pay for real estate taxes, and mortgage and homeowners
insurance premiums as they are received each month.
Do all loans require impound
If you are taking out a FHA or VA loan, the lender can require
an impound account to pay real estate taxes and hazard insurance premiums, as
with a standard loan. Most conventional loans do not require an impound
Are taxes on second homes deductible?
Mortgage interest and
property taxes are deductible on a second home if you itemize. Check with your
accountant or tax adviser for specifics.
How is a home's
You have several ways to determine the value of a home.
An appraisal is a professional estimate of a property's market value, based on
recent sales of comparable properties, location, square footage and construction
quality. This service varies in cost depending on the price of the home. On
average, an appraisal costs about $300 for a $250,000 house. A comparative
market analysis is an informal estimate of market value performed by a real
estate agent based on similar sales and property attributes. Most agents offer
free analyses in the hopes of winning your business. You also can get a
comparable sales report for a fee from private companies that specialize in real
estate data or find comparable sales information available on various real
estate Internet sites.