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What Homeowners Need to Know about Property Taxes

Paying property taxes is a necessary part of homeownership. Homeowners need to know about property taxes specific to their jurisdiction. Otherwise, you risk getting fined or other penalties. This article helps outline the basics for homeowners in the Carolinas.

Why do we pay property taxes?

Property taxes generate revenue for local governments to fund public services and community development. Services could include public schools, police and fire departments, road maintenance, parks, libraries, and other community resources.

Property taxes help ensure the availability and quality of these services for residents. Plus, they are considered a fair method of taxation as they are based on the value of the property owned and help distribute the tax burden more equitably.

These taxes provide local governments with a degree of financial autonomy and control over their jurisdictions. They can set tax rates and use the revenue generated to address specific local needs and priorities.

Key points about North Carolina property taxes

Property taxes in North Carolina are determined based on the assessed value of the property and the county’s tax rate. Each county sets its own property tax rate, which is expressed in terms of cents per $100 of assessed value. The tax rate can vary significantly between different counties.

Property evaluations are usually done every four to eight years. The county tax assessor’s office assesses the value of each property within its jurisdiction based on physical condition, location, and comparable sales in the area. This assessment process can result in changes to your property value and, consequently, the amount of property taxes you owe.

If you believe the assessment value is inaccurate, you can typically request a reassessment. The specific procedures and deadlines for filing an appeal vary by county. But to get started, you’ll usually contact your local tax assessor’s office to initiate the appeal process.

You may also qualify for exemptions that reduce property tax liability. Common exemptions include:

  • Homestead Exemption for elderly or disabled individuals.
  • Circuit Breaker Tax Deferment Program which limits taxes each year to a percentage of the qualifying owner’s income.
  • Disabled Veterans Property Tax Exclusion exempts the first $45,000 of your assessed real property value.

Key points about South Carolina property taxes

South Carolina uses an assessment ratio to calculate property taxes. The assessment ratio varies based on the type of property. For primary residences, the assessment ratio is typically 4%, meaning the assessed value is 4% of the property’s market value. For other types of properties, such as commercial or rental properties, the assessment ratio is 6%. As in North Carolina, the county assessor will determine the market value.

One thing to be aware of is that when you buy a new home you will start at the 6% rate. It’s up to you, or your mortgage company, to make sure the county assessor knows that this home is your primary residence, says Donna Williamson, a Saussy Burbank preferred lending partner Highland Mortgage, “If you don’t do that, your payment skyrockets.”

South Carolina property owners also pay a local millage rate. Each county in South Carolina sets its millage rate with one mill equal to one-tenth of a cent. The millage rate is applied to the assessed value of the property to determine the amount of property taxes owed.

Property tax exemptions in South Carolina include:

  • Homestead Exemption for residents aged 65 and older or disabled individuals
  • Legal Residence Exemption for active-duty military personnel
  • Agricultural Use Exemption for qualifying agricultural property

A state property tax relief program is also available to elderly or disabled individuals with limited income. To learn more about the Property Tax Deferral Program contact your local tax authority.

We hope you’ve enjoyed this latest installment of our Important Things Homeowners Need to Know series. If you missed the article on property insurance, you can still review it. In the meantime, Saussy Burbank is continuing to build high quality homes throughout the Carolinas. Take a virtual tour.



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