Property tax, or officially known as real estate tax, refers to the public contribution levied from real property that you've purchased in the states. By real property, we mean property that you have purchased, not that you're renting. Even though you don't directly pay property taxes when you rent out a property, your landlord does take that into account in your rent. From the IRS publication 530, some of the property types that are included when filing for real estate tax are houses, condominium, cooperative apartment, mobile home, houseboat, or house trailers.

Owning any of this real estate listed above would qualify you as property tax contributor. There comes plenty of things to know when dealing with real estate tax. Some of these include expenses that you can and cannot deduct, tax credits, adjustments, and records that you should keep.

The government charges annual tax on the value of the real estate property you own. Additionally, there are other costs to consider such as closing costs, mortgage interest, and repairs.

If you have any questions regarding what qualifies your property to levy for real estate or property tax, fill out the contact form below and we'll be in touch with you as soon as possible.

Like in individual income tax or corporation income tax, there are expenses that can be deducted from your yearly tax. These two expenses that can be deducted are stare and local real estate taxes imposed to you by the taxing authority and interest that qualifies as "home mortgage interest". Again, this can all be found in "Publication 530".. By reading that publication, you'll be able to notice that there are a good amount of details that cannot be missed while filing your taxes. This is why we recommend seeking a professional when you file your real estate taxes.

Take a look at this video by Parker Gray, Realtor to get a better understanding of what property tax is.

When is Property Tax due?

Your property tax first installment is due on November 1st. Additionally, taxes are charged upon your previous year. We do not pay property taxes based on the current year. Real estate taxes are "often prorated at closing when a home is closed".

There are penalties if you don't pay your property taxes on time. What ends up happening is that if your real estate taxes stay delinquent for long enough, you'd eventually end up losing your home. The way you'd lose your property is through a tax lien. A tax lien allows the government to sell your home on your behalf so that they could collect their tax money. This is why paying for your property tax is extremely necessary.

Here is this video by US Realty Training about when your property taxes are due:

How do I file My Property Tax?

Filing your Property Tax is usually done through the company that is making payments to the bank in your behalf. These companies also make payments for your property tax in your behalf. When you stop paying these companies, then you should start paying the bank directly. If you don't pay your property tax, then the government could place a tax lien on your property.

In order to file your property tax deductions correctly, it is recommended you see a professional tax preparer. By doing this, the tax preparer will be able to identify expenses that could count as deductions. Property tax deductions are sent in when you send in your individual or corporate income tax at the end of the year. If you want to read more about Income tax, you could visit our income tax page.

Where do I file My Property Tax?

You could file your property tax with either the help of a professional or you could do it yourself. Many mortgage companies offer an online portal where you could make payments on your mortgage. Like we mentioned before, the payments you make toward your mortgage usually include amounts that will be used to pay for your property tax. Lenders set up an "escrow" account for your property tax funds that they then use on your behalf to make property tax payments.

Why is My Property Tax required?

Just as other kind of taxes, property taxes are used to improve our communities. Rate.com refers to the public assets and commodities that property taxes are used to improved as the "six S's". These would include: Schools, Safety, Spaces, Streets, Sanitation, Services.