Question

1.) What is the total property tax bill for your house in Ohio with a market value of $125,000? Note the following and show your calculations in the space below:  You are eligible for the $25,000 homestead exemption.  The city in which you live has a millage rate of 70.  Don’t forget residential taxable value is 45% of assessed value in Ohio! Assuming the exact same scenario as above;

2.) Research online to identify a proposed levy (present or past) that would impact property taxes. The levy can be in any state over the last 5 years BUT still assume the scenario in Q1 for the sake of simplicity/practice. Identify: A. The source: B. A summary of the issue (location, proponents, why pursuing), 100-250 words: C. The proposed levy’s impact on property taxes: D. How the levy would impact YOUR property taxes for the property in Q1:

Answer 1

1. Assessed Value= Market Value x 45%

= $125,000 x 45%= $56,250

  Current Real Estate Tax= (Assessed Value-Homestead Exemption) x Millage Rate/1000

= ($56,250-25,000)*70/1000= $2,187.50

2. A. Source of Proposed Levy is the laws, rates and methods of calculation proposed by Department of Taxation, Ohio.

B. As per the source, the millage rates in each county of the state can be different. Further, the actual residential tax value is 35% of the taxable value. So if we take the instance of Harrison County of Ohio State, then the property taxes will be low as below:

Assessed Value= Market Value x 35% =$125,000 x 35% = $43,750

  Current Real Estate Tax= (Assessed Value-Homestead Exemption) x Millage Rate/1000

= ($43,750-25,000) x 60/1000 = $1,125

The property tax rate is very low, due to Millage rate being low. Harrison County has been given the status of special tax county.

C. Impact on Property Taxes= Tax calculated under A- tax calculated under B

= $2,187.50 - $ 1,125= $1,062,50

Impact in terms of tax rates will be as below

= Average Tax Rate in A - Average Tax Rate in B

= 2,187.50/125,000 - 1,125/125,000

= 1.75% - 0.9% = 0.85%