Property Tax Calculator Formula

Understand the math behind the property tax calculator. Each variable explained with a worked example.

Use the Property Tax Calculator

Formulas Used

Annual Property Tax

annual_property_tax = annual_tax

Monthly Property Tax

monthly_property_tax = annual_tax / 12

Taxable Value (after exemptions)

taxable_val = taxable_value

Total Exemptions

total_exemptions = homestead_exemption + additional_exemptions

Effective Tax Rate

effective_rate = assessed_value > 0 ? annual_tax / assessed_value * 100 : 0

Variables

VariableDescriptionDefault
assessed_valueAssessed Property Value(USD)350000
tax_rateTax Rate (per $100 or %)(%)1.2
homestead_exemptionHomestead Exemption(USD)25000
additional_exemptionsOther Exemptions (senior, veteran, etc.)(USD)0
taxable_valueDerived value= assessed_value - homestead_exemption - additional_exemptions > 0 ? assessed_value - homestead_exemption - additional_exemptions : 0calculated
annual_taxDerived value= taxable_value * tax_rate / 100calculated

How It Works

How Property Taxes Are Calculated

Property taxes fund local government services including schools, roads, fire departments, and public safety.

Formula

Annual Tax = (Assessed Value - Exemptions) x Tax Rate

Key Concepts

  • Assessed value: Determined by the county assessor, often a percentage of market value
  • Mill rate / tax rate: Set annually by local taxing authorities. One mill = $1 per $1,000 of assessed value = 0.1%
  • Exemptions: Reductions for homestead, senior citizens, veterans, disability, or agricultural use

    • Assessment Ratio

    Some states assess at a fraction of market value. For example, if the assessment ratio is 80% and market value is $400,000, the assessed value is $320,000.

    Worked Example

    A home assessed at $350,000 with a 1.2% tax rate, $25,000 homestead exemption, no other exemptions.

    assessed_value = 350000tax_rate = 1.2homestead_exemption = 25000additional_exemptions = 0
    1. 01Assessed value: $350,000
    2. 02Homestead exemption: $25,000
    3. 03Taxable value: $350,000 - $25,000 = $325,000
    4. 04Annual tax: $325,000 x 1.2% = $3,900
    5. 05Monthly tax: $3,900 / 12 = $325.00
    6. 06Effective rate: $3,900 / $350,000 = 1.114%

    Ready to run the numbers?

    Open Property Tax Calculator