Understanding property taxes is imperative if you are about to buy a new home or condo.
Not only do you need to know how they will work but also how to determine property taxes but most of all: to also calculate property taxes.
First and foremost, property taxes are taken by governments so as to pay for public services such as law enforcement, fire fighting and road maintenance.
Now, whether you buy a condo or home, the tax you have to pay is also determined by an ‘assessment area’. So, when the government calculates your tax rate, it will be based on the market value of similar homes in your community.
In order for you to find out how much tax you have to pay in advance, multiply your home’s assessed value by the tax rate.
Apart from this, you should understand that property taxes will also be part of your closing costs. So, as soon as you close on your new home, make sure you pay your property taxes.
If you’re not sure how it works, then you should ask your agent as they will tell you what the amount and terms are. In most cases, they will calculated on a pro rata basis from the time of the purchase until the end of the year. After this, you will have to pay your taxes in full.
Finally, also remember that you can factor this type of tax into a person’s overall tax picture. Check with a financial expert to see if you write off your property taxes against your income tax. This will help you save some cash.
Don’t forget that buying a property has tax benefits, so remember to use them right from day one.
Also, make sure you find out as much as you can about property taxes by using the expertise of your real estate agent too.