The first thing to learn about property tax

By
Real Estate Agent with Re/Max 10 New Lenox Illinois

 

Understanding Property Taxes

Property taxes can be a major expense for investors, but understanding how this tax works could save you thousands of dollars in the long run.

The first thing to learn about property tax is that property is divided into two categories: real and personal. Real property includes land, buildings and permanent property attached to land— such as a well. Personal property is everything else, including clothes, books, electronics, furniture and financial holdings. Personal property is further divided into either tangible property or intangible property. Tangible property is anything you can touch, such as a sofa or a blender and intangible property includes abstract possessions like stocks, bonds and patents.

Methods for calculating property tax vary from city to city. Smaller cities send an appraiser from house to house every one to five years and this appraiser calculates the property’s value. Larger cities use an automated valuation method. Whichever method is used, you should look over your property’s valuation for mistakes or miscalculations. Property owners generally have a small amount of time to appeal the assessed value of their property and mistakes do occur, especially in automated processes.

Knowing the correct value of your property is important not only for paying property taxes, but also for purchasing insurance. To insure your property and possessions against damage or theft, first check for cheap insurance quotes online. Cheap insurance is readily available: There is no need for you to leave your property vulnerable.

If there is an obvious flaw in your property’s valuation, you should register your complaint with the city immediately. The city can repossess your property if you simply choose not to pay your property taxes without first registering a complaint. In contesting the valuation of your property, it is important to do research and have hard evidence as to why you think a mistake has been made. Realtors can provide you with the figures on recent sales of comparable properties and professional appraisal firms are available to evaluate the value of your possessions. These services cost up to $500 but they can catch mistakes in your city’s valuation process that could cost you much more in taxes over the years.

Property taxes are an unfortunate fact of life, but reducing its burden on your wallet is sometimes possible. Diligently reviewing the paperwork on your property’s valuation, knowing the value of items in your house and keeping receipts and records to prove these values can save you from overpaying on property taxes. Part of being a responsible property owner is keeping up to date with all of your taxes, along with properly insuring your property and possessions.

Finally, make sure that the money you’re paying on property taxes isn’t wasted in the event of a burglary, fire or flood by shopping for cheap insurance quotes to cover your valuables and possessions. With so many types of cheap insurance available today, leaving your property uninsured is foolish when you’ve already paid for debt service and taxes on it.

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Rainer
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Brett Reichel
Homebridge Financial Services - Rancho Cucamonga, CA
MLO 210215

Great post - appreciate the info - very helpful.

Oct 28, 2011 10:30 AM #1
Rainmaker
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Dale Taylor
Re/Max 10 New Lenox Illinois - Frankfort, IL
Realtor = Chicago Illinois Homes Townhomes Condos

Glad it is helpful to you Brett.  Thanks

Oct 28, 2011 10:45 AM #2
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Rainmaker
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Dale Taylor

Realtor = Chicago Illinois Homes Townhomes Condos
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