Property Taxes

[SamSpade]

I was looking at my mortgage statements and noticing each year how the assessment and the taxes went up - until recently, when the assessment went WAY down.

But - the taxes STILL went up anyway. What happened there? I thought property taxes were a given percentage of property value. Seems to me the property could go down to ZERO and they'd still raise the tax.

What gives?

 

[Vince]

:shrug: My property taxes go up every year. Last year up $300. This year probably more.

 

[koan00]

If you have been in your home for a while, and taxes go way up, you usually get the higher rate "phased in" over several years (I think maybe 10% increase a year max - MD Homestead Tax Credit ). So you may be paying a lower rate than you should because of this. Even if the actual tax rate drops, you may still be lower than the new lower rate because of the slow phase in. So now you are just phasing in to a lower ceiling you are still below. That make any sense?

 

[Dakota]

That make any sense?

Nope... and it isn't the 1st time I've seen it or heard it explained. I just feel like I heard "bend over and grab your ankles"

 

[Tilted]

I was looking at my mortgage statements and noticing each year how the assessment and the taxes went up - until recently, when the assessment went WAY down.

But - the taxes STILL went up anyway. What happened there? I thought property taxes were a given percentage of property value. Seems to me the property could go down to ZERO and they'd still raise the tax.

What gives?

Have you been living in this house for a while? You've probably been getting the Homestead Tax Credit.

http://forums.somd.com/life-southern-maryland/211438-property-tax-increase-why.html#post4345975

http://forums.somd.com/life-southern-maryland/165502-property-assessment.html#post3509451

Also...

http://forums.somd.com/life-southern-maryland/220101-2011-tax-assessments.html#post4481199

http://forums.somd.com/news-current-events/198405-tax-asessment.html

 

[Gilligan]

The property value assessment and the taxable assessment are both shown on the report you receive. As long as the taxable assessment (on which your tax owed is based) is less than the value assessment, your tax paid will increase every year by the maximum amount allowed by law..unless and until the two assessments are the same.

 

[onel0126]

Approaching the ridiculous here in La Plata. My friend across the bridge in a beautiful new neighborhood in KG county VA is paying 1500 a year in a 3200sq. ft. home. I am paying north of 8000 for the same.

 

[Dakota]

Approaching the ridiculous here in La Plata. My friend across the bridge in a beautiful new neighborhood in KG county VA is paying 1500 a year in a 3200sq. ft. home. I am paying north of 8000 for the same.

Welcome to Prince George's County, Part II

 

[libertytyranny]

mine too :sigh:

 

[onel0126]

Welcome to Prince George's County, Part II

In more ways than one.....

 

[ginwoman]

Approaching the ridiculous here in La Plata. My friend across the bridge in a beautiful new neighborhood in KG county VA is paying 1500 a year in a 3200sq. ft. home. I am paying north of 8000 for the same.

that's nuts. are you on the water or something?

 

[Sweet 16]

Approaching the ridiculous here in La Plata. My friend across the bridge in a beautiful new neighborhood in KG county VA is paying 1500 a year in a 3200sq. ft. home. I am paying north of 8000 for the same.

Welcome to Prince George's County, Part II

Yes and I believe Charles County just announced tax rates would be increasing again. Several years ago, the county was crowing about how they didn't have to raise the tax rate, but people still paid more in taxes because their assessments went up even as property values were tanking, leading a lot of homeowners to try and appeal their assessments. Taxes actually went down last year because the assessments went down and their was no tax rate increase. Now the county has a huge deficit and guess what's the first way they are going to make up for it?

 

[jetmonkey]

Only rich people can afford to purchase a home, you can afford it.

 

[Friends4now]

I just recently purchased land and had my home built a few months ago in St Marys County. I haven't owned a home in Maryland therefore, I am not familiar with the property tax situation. Can anyone tell me how I should go about or if I can even take advantage of the Homestead tax credit. I have checked the assessment website but I could spend hours trying to find information. I'd appreciate any/all info that anyone can give me. thanks.

 

[NorthBeachPerso]

The Homestead Exemption kicks in after you've been in your primary residence one year. Generally your assessment increase, and hence your tax bill, is limited to a 10% increase per year no matter how much higher the assessment increase might be.

MD Homestead Tax Credit

 

[Tilted]

I just recently purchased land and had my home built a few months ago in St Marys County. I haven't owned a home in Maryland therefore, I am not familiar with the property tax situation. Can anyone tell me how I should go about or if I can even take advantage of the Homestead tax credit. I have checked the assessment website but I could spend hours trying to find information. I'd appreciate any/all info that anyone can give me. thanks.

You won't benefit from the Homestead Tax Credit initially; however, you may benefit from it in years to come. It will limit how much your property taxes can increase each year going forward (i.e. it limits how much the tax base on which you pay taxes can go up each year, but if the tax rate that applies to everyone is increased then the total taxes you pay could go up more than the limit). In St. Mary's County, the limit for the increase is 5% per year.

So, if your property with the house is now assessed for $250,000, that's likely what you will be paying taxes on. But if the assessment increases significantly a couple years from now (to, say, $300,000), you will only have to pay taxes based on $250,000 + 5% + 5% ($275,625). That will only be true if this remains your primary residence and my guess is that it doesn't apply if you make significant improvements that increase your assessed value (e.g. build a house on the property) - I'd have to do some research to confirm how that works though (or you could if it becomes relevant to you).

Over time, if property values increase substantially, the credit can become quite valuable. But it doesn't help you much when you've just recently purchased (or started living in) the property.

Here's a link to submit an application for the credit online.

Here's a link to a pdf that can be printed out and mailed in.

 

[Dupontster]

"Welcome to Maryland...What's in your pocket?"

 

[desertrat]

If you have been in your home for a while, and taxes go way up, you usually get the higher rate "phased in" over several years (I think maybe 10% increase a year max - MD Homestead Tax Credit ). So you may be paying a lower rate than you should because of this. Even if the actual tax rate drops, you may still be lower than the new lower rate because of the slow phase in. So now you are just phasing in to a lower ceiling you are still below. That make any sense?

Yep. Still playing catch up to back when the prop. values went way up.

 

[jasn]

I'm curious if there are any other events, (besides the county's assessment), that can reduce, (or increase), the value of a home, for the purposes of property taxes.

As an example, if one were to buy a home for 600k, whos current assessment, and property taxes, is based on a value of 650k, does the assessment automatically reduce based on the actual sale price?

(Why do I get the feeling that the answer is going to be an emphatic NO..?)

BTW, are the homes here assessed for tax evaluation every year? Or are any of these issues dependent on the county in question?

Thanks..

 

[Rommey]

As an example, if one were to buy a home for 600k, whos current assessment, and property taxes, is based on a value of 650k, does the assessment automatically reduce based on the actual sale price?

(Why do I get the feeling that the answer is going to be an emphatic NO..?)

Don't confuse assessment and appraisal. An appraisal is basically the retail value of the property, i.e., what someone would pay to buy or a lender would lend. An assessment is what the government assigns as a value for tax purposes.

BTW, are the homes here assessed for tax evaluation every year? Or are any of these issues dependent on the county in question?

Assessments are every three years. And you can appeal an assessment if you feel it is too high. I did this last year and they lowered my assessment...wasn't as much as I was hoping for but still should lower my tax by a couple hundred dollars each year. However, any lower taxes will probably be offset by the Homestead credit, so the actual amount I pay will be about the same.