Property Taxes: What are they and WHO Pays them?

Image Credit

Only two things are certain in life: taxes and death. Of property taxes, this is especially true.

WHAT are they?

Property taxes are assessed on the value of your home or property, based on the city/state that you live in. Some cities with more businesses paying more in taxes will have lower tax rates and some cities who require a large public works project will have a higher property tax rate. Some states, like Texas, have much higher property tax rates as they charge no income tax. This tax money is typically used locally for schools, roads, and community expenses. They are charged annually in November and are typically due shortly thereafter.

WHO pays them?

YOU! Or whomever owns the land/home you are living on/in. If you have a mortgage, a part of your payment each month is set aside in an account called escrow to pay your taxes at the end of the year. If you have no mortgage, you are STILL required to pay taxes on the property each year, but you will have to save  up the money yourself and be prepared to make a payment annually.

I had a seller recently whose home was paid off. She didn’t know she had to continue to make tax payments on her property, so she was several years behind in taxes when she sold her home, which was a big frustration for her.

So, while death is someday certain… property taxes are even surer!

Share This: