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Pinellas County
Property Appraiser Web
Site Pasco Property Appraiser
Web Site
Hillsborough Property Appraiser
Web Site
ESTIMATING AD VALOREM PROPERTY TAXES
Q: How Can I Estimate Future Taxes on a New Home?
A: Property taxes are determined by multiplying the property's
taxable value by the millage rate set each year by the taxing
authorities.
The basic formula is:
Just/Market Value, Capped by the Save Our Homes Cap = Assessed Value
Assessed Value - Exemptions = Taxable Value
Taxable Value / 1,000 x Millage Rate = Gross taxes*
On January 29, 2008, Florida voters approved an additional $25,000
homestead exemption to be applied to the value between $50,000 and
$75,000. This additional exemption does not apply to school taxes.
Therefore you must add the school taxes back in to the Gross Tax
amount (approximately $200.00).
Because each year's property value stands alone, it is difficult to
estimate taxes before annual property values and millage rates are
established.
A property's value is not based solely on the specific purchase
price of that property.
Value is a reflection of the market. When sale prices decline, so do
values, and conversely when sale prices increase, so do values. An
arms-length sale price is one component used, along with other
market information, such as comparable sales, to help establish
values.
To get a rough estimate of future taxes, you can multiply your
purchase price by the current millage rate in the tax district where
the property is located. (Please note that that foreclosure or tax
deed sales are not considered "arms-length sales," and may not be
given the weight of arms-length transactions in our sales comparison
approach to value. If your purchase price is a foreclosure price,
you may get a more accurate estimate of taxes by using the current
Just/Market value of the property or an estimated purchase price if
the property was on the open market.)
You can review the latest millage rates from the Tax Collector's
website, or use 24.0 as a starting rate for estimating. Please keep
in mind that annual millage rates and values may change as of
January 1, so this method is for estimation purposes only. If you
apply and qualify for Homestead Exemption, you can expect to save
about $500 - $800 on your taxes the first year of the exemption. (If
you qualify for Cap portability from a previous homesteaded
property, you may save more in taxes.) Also, if you apply and
qualify for the Low Income Senior Exemption, you can expect your
taxes to be reduced by approximately $19 - $204, depending on where
you live.
Often, real estate professionals will suggest that you use 85% of
your purchase price for estimating taxes. While doing so will give
you a ballpark number, be aware that, depending on the date of your
sale in relation to the January 1 assessment date and the actions of
other buyers in the market, your property value may differ
significantly from your purchase price.
It is important to remember that when a property sells, the previous
owner's exemptions and Save-Our-Homes Cap will be removed at the end
of the calendar year, which can cause a dramatic increase in taxes.
Do not rely on the current owner's tax amount when estimating your
taxes. More important information on the removal of the
Save-Our-Homes Cap can be found here.
WHY ESTIMATING PROPERTY TAXES IS NOT AS EASY AS IT USED TO BE…
Assume 2 owners share a duplex. One lives in and claims homestead
exemption on half the duplex, the other is a nonresident
and does not claim homestead.
Also assume that the homesteader is over 65 years of age, and has an
income low enough to qualify for the additional
homestead for low-income seniors, and that the market is increasing
at a rate greater than 10% per year.
Prior to 1994, before Save-Our-Homes, the tax calculation was
simple:
market value - 25,000 homestead = taxable value, and
taxes = taxable value ÷ 1000 x all the millage rates added together
Today, the tax calculation is much more complicated.
The homestead half of the parcel is:
1) capped so that its assessed value cannot increase by more than 3%
(Save Our Homes);
2) eligible for the original 25,000 homestead;
3) eligible for the 15,000 or 20,000 or 25,000 or 50,000 low-income
senior exemption depending on where the duplex is
located; and
4) eligible for all or part of the 25,000 amendment 1 homestead
exemption increase if that half of the duplex is valued for
50,000 or more.
The non-homestead half of the parcel is capped with no more than a
10% increase in value
THE RESULT:
The parcel has one assessed or capped value for the school millages
because the 10% cap does not apply to
schools.
The parcel has a different assessed value for all other millage
rates to which the 10% cap applies.
The parcel has one taxable value for schools because the senior
exemption and additional homestead exemption do
not apply to schools.
The parcel has a different taxable value for the county, SWFWMD, JWB
and most other millages to which the
additional amendment 1 homestead exemption applies.
The parcel has a third taxable value for its city or the MSTU area
because the low income senior exemption only
applies to the municipal or MSTU millage.
Finally if the homesteaded homeowner is also qualified to receive
the Combat Wounded Veteran Discount, each
taxable value will be discounted in different amounts based on his
or her percentage of disability.
Taxes must be calculated millage by millage based on the exemptions
and capping scenarios that apply. Then all taxes
derived from each millage rate are added together to arrive at the
total tax amount. |
