They say that houses in the United States are cheap, but the United States still levies property taxes every year.

Who collects property taxes in the United States?

Property taxes in the U.S. are collected by the county where the house is located and are used to pay for different expenses, from school districts to city construction to other special uses.

How do I pay property taxes?

Property taxes are paid once a year, and the collection department sends a breakdown of the property taxes to the address of the house each year. The owner can write a check and send it back, or you can follow the account instructions above and transfer it directly using online banking with no fees. Of course, you can also pay on the official government website.

How are property taxes calculated in the United States?

About the tax base

Before we talk about how property taxes are calculated, we would like to introduce a professional concept - tax base.

The total amount of real estate tax collected in the U.S. = tax base * total tax rate.

The tax base here is determined by the valuation of the house, which is the responsibility of the county where the house is located. The valuation result mainly depends on the surrounding house price, parcel size, house type, house type, house age, and house support.

Usually, the valuation of the house given by the government will be lower than the actual market value of the house, sometimes much lower.

About the total tax rate

In the U.S., the real estate tax rate is determined by local governments each year based on various budget revenues and expenditures, so the tax rate varies from place to place and is constantly being adjusted.

Typically, real estate taxes do not fluctuate much. In general, the set tax rate fluctuates within a small range in each state.

For example, California is around 1.25%, with some higher and some lower; Texas is around 2.5%, with some as high as 3%.

Sometimes the state, city and other levels will vote on whether to increase some of the fees to be paid, such as whether to increase property taxes by 0.01% to build a bridge? These are all things that residents can vote for.

There is no such thing as a state tax or city tax, but there may be additional provisions at the state and city levels, primarily for county property taxes.

What are the tax benefits of property taxes?

Each year, the government offers a series of homeownership incentives, which are defined as homes where the owner has lived in the home for two years within a five-year period. This credit is generally available every year after application.

There are also a number of other incentives that the government publishes on its website each year, and forms are usually sent to the housing address.

Why is property tax levied in the United States?

Education expenses are a considerable expense in the United States. Most of the property taxes levied on the general public in the United States are used by local governments for education, also known as school district taxes.

These taxes cover a range of expenses such as student lunches, school bus maintenance, updated and maintained teaching equipment, teacher salary payments, and benefit guarantees.

In addition to being used for education, property taxes are also a major source of funding for local government agencies. For example, there are 1,842 departments in Washington State that rely on property taxes to keep them running.

These departments primarily provide services to the people or municipalities, and in a sense take from the people. Examples include roads, utilities, schools, libraries, water and power, waste disposal, transportation, disease control, ports and airports, etc.

In the view of most Americans, it has become a habit to pay property tax when you have a property, because only by paying the tax can you ask the government to provide good public services.

In addition, how the property tax is allocated to all levels of government and how it is used by local governments are clearly publicized, so Americans do not have to worry about losing money because they have paid more taxes.

Generally speaking, even if you have to pay various taxes to invest in property in the United States, the overall return on investment is still relatively objective considering the rental income and expenses, as well as the increase in housing prices.