property tax with currency

General property tax information

It is helpful to have your property tax bill handy for this explanation of general property tax information and how it relates to CAUV.

Your property tax information will typically show several different types of values:

  • Market or appraised value: The full market value of the property. If you are on CAUV, this is NOT the value used for tax purposes, but is what would be used to figure any recoupment you might pay if you remove your land from CAUV.
  • CAUV value: The total CAUV soil value of the property that qualifies for CAUV treatment.
  • Improvement value: The value of buildings and other improvements subject to taxation.
  • Taxable value: This is the total of your values reduced to 35 percent. This is the value actually used to determine your taxes due.

The Tax Reduction Factor that you see on your tax bill is the amount that the taxes must be reduced to comply with HB 920:

  • HB 920 is the property tax control that ensures levies only collect the same amount of money originally raised in their first year.
  • Nearly all voted levies must comply with HB 920. The inside 10 mills are not reduced by the tax reduction factor.

Your tax bill will typically show two tax rates:

  • “Gross millage” is the combination of the inside 10 mills and the amount of mills you and your fellow residents have voted for in total. This rate is not applied to determine your tax bill.
  • “Effective millage” is the inside 10 mills and the millage rate after the application of the tax reduction factors. This is the rate that is multiplied by your taxable value to determine the taxes due.

There are typically two additional credits on your tax bill:

  • The non-business credit is the former “10 percent reduction.” This credit is typically between 9-10 percent. The credit only applies to levies originally in place prior to 2013, including any renewals of levies in place prior to 2013. As new levies are added, the credit goes down because it does not apply to that new millage.
  • The 2.5 percent owner occupied credit is given to those who own their home and live in that home as their residence. This also only applies to levies that were originally in place prior to 2013 as well, and so may be less depending on the mix of millage in your district.