A property tax is paid by every person who owns a property. The tax is paid to the local government for the value of the property. The tax responsibility increases based on the value of the property. Property tax is also known as real estate tax and funds a wide range of services like the road maintenance, education and so on.
Paying property tax is important as well as uncertain if the payer is not aware about the property tax terms and conditions. But it is advisable that every property owner has to pay their property tax to not to just stay safe, but also to enjoy various benefits.
A person can enjoy various benefits by paying property tax a year earlier also. Paying the property tax a year earlier will accelerate the federal deductions. Although paying the property tax is much dreaded by the property owner, both the property owner and the city are benefited with the property tax.
The property tax has to be paid in order to keep an account of the true value of a piece of property. Also many cities follow a procedure of sending an assesse to the property tax payer’s home. This in turn makes it difficult for the tax payer to hide the actual value of the property.
The payment of property tax results in the low administrative costs when compared to other taxes. The paperwork of property tax is charged lower when compared to other tax payments.
The property tax income is much more stable than the sales tax or the income tax in a country. Depending on this basis a property tax payer can predict the amount of the property tax.
As the property tax rates are controlled locally, the information regarding that can be easily gained and the individual property owners also will have an opportunity to protest their assessment. Also the property tax payer is benefited, as he pays for the same service every year.
Henceforth a property tax payer is benefited in all these ways while paying the property tax.
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There are 2 mistakes
1. Property taxes on Capital Value are calculated on BUILT UP AREA and not on carpet.
2. Property Taxes = Capital Value x Current tax rates is not correct
Property Taxes = Capital Value x % prescribed rates of taxes as per the status
of the property (i.e. Residential, Bank, Hospital, Educational
Bldg. etc.