I had a really good question from one of my clients. How do you estimate property taxes on a home that you’re going to purchase?
Taxes are based on the County Assessor’s value, which is usually close to what you pay for the home. The math is wonderfully easy…the assessed value x 1%… so if you’re looking at a million dollar property… $1,000,000 x .01 = $10,000… so your property tax base will be $10,000.
But wait, there’s more…
On top of that $10,000, you’ll need to multiply your million by a percentage to cover whatever voted indebtedness and district assessment are on your future bill. The number is different for each county, but if you use .25%, you’ll have a slightly high, but good rough estimate, so…$1,000,000 x .0025 = $2,500.
After that easy math, you’ll come up with a grand total of an estimated $12,500 for your annual tax bill on a million dollar home.