Property Tax Estimator
Estimate annual property tax from assessed value and mill rate.
Returns yearly bill, monthly escrow amount, and effective rate for budgeting.
Property tax is an annual tax levied by local governments (counties, municipalities, school districts) based on the assessed value of real estate you own. It is the primary funding source for local public schools, fire departments, and infrastructure.
Core formula: Annual Property Tax = Assessed Value × Mill Rate ÷ 1,000
Alternatively expressed as: Annual Property Tax = Assessed Value × Effective Tax Rate
What each variable means:
- Assessed Value — the value assigned to your property by the local tax assessor. This is often not the same as market value. Many jurisdictions assess at 70–100% of market value; some assess at a fixed fraction (e.g., 40%).
- Mill Rate — the tax rate expressed in mills. One mill = $1 of tax per $1,000 of assessed value. A mill rate of 20 = 2.0% effective tax rate.
- Effective Tax Rate — the simpler decimal form: (Annual Tax ÷ Market Value × 100). Ranges from about 0.3% (Hawaii) to 2.5%+ (New Jersey, Illinois).
Assessment ratio: Assessed Value = Market Value × Assessment Ratio
Many counties do NOT assess at 100% of market value. Always check your local assessment ratio before estimating taxes.
Common exemptions that reduce assessed value:
- Homestead exemption — for primary residence owners (reduces taxable value by $15,000–$50,000 depending on state)
- Senior exemption — additional reduction for homeowners 65+
- Veteran exemption — for qualified military veterans
- Disability exemption — for disabled homeowners
Worked example: A home has a market value of $380,000 in a county with:
- Assessment ratio: 80%
- Mill rate: 22.5
- Homestead exemption: $25,000
Step 1: Assessed Value = $380,000 × 0.80 = $304,000 Step 2: Taxable Value = $304,000 − $25,000 (exemption) = $279,000 Step 3: Annual Tax = $279,000 × 22.5 ÷ 1,000 = $6,277.50 Monthly escrow amount = $6,277.50 ÷ 12 = $523.13/month
Reference: Average effective property tax rates by state (2024):
- Hawaii: 0.32% | Alabama: 0.41% | Colorado: 0.51%
- National average: ~1.10%
- Texas: 1.63% | Illinois: 2.08% | New Jersey: 2.49%