How To Pay Your Property Tax

Property tax in the United States can be divided into two categories: real and personal.  Real property tax is the tax you pay on the real estate you own (the building or improvement value and site value).  Personal property varies depending on where you live, but often includes belongings like stocks and bonds, appliances, tools, furniture, machinery, cars, boats and planes, among other vehicles.  In some parts of the country, personal property tax applies only to mobile, business-related property. 

The level of local government assessing and collecting these taxes varies depending on your locality as well.  Personal property tax is commonly claimed by your state.  Real property tax is assessed and claimed by a local municipality like the district, city or county.

1. Calculating the property tax.  Real property tax is often calculated by multiplying a tax rate like 0.6% by the assessed total value of your real estate.  If your home is valued at $200,000 and the tax rate is 0.6%, then your property tax would equal (200000 x 0.006), or $1200.  Sometimes, though, a municipality will impose a flat tax rate on every unit of particular dollar value in the total value of your real property.  For example, let's say the tax rate was $15 for every $2000 in the value of your real property, which was assessed at $200,000.  In this case, since there are 100 of those $2000 units in the total value of your house, your real property tax would be (15 x 100), or $1500.

   All personal property relevant to the property tax laws of your municipality must be declared so as to be taxed.  Municipalities apply the same tax rate to personal property as to real property.

2. Frequency of payment.  Some municipalities require two payments of property tax per year, while others collect the entire property tax in one yearly sum.  Due dates for payment vary as well.  If you are unsure about the timeline in your municipality, contact your state's office of revenue or taxation.  Simply searching online with your state and the keyword "property tax" will point you in the direction of the answers you seek (for example, "New Jersey property tax").  
3. Paying the property tax.  County treasurer offices and your state's Department of Treasury can generally assist you in learning what options are allowed in your area.  Visit their websites online or find their phone number in the phone book to speak with someone and get your questions answered.  The following are possible ways for you to pay your property tax.
   • Pay property tax online.  An increasing number of Americans are paying taxes online, and property tax is no exception.  Visit the website of your state government office overseeing taxation; there, you can determine whether online payment is an option.  If online property tax payment is available in your area, you will also know by conducting a Google search for "pay property tax online + [home state and county]."  You will need an accepted credit or debit card, as well as access to your property tax statement, in order to pay property tax online.

     As with all online transactions, make sure you can trust in the security of the website when you pay property taxes online.

   • Pay property tax by phone.  The same credit or debit card can be used to pay property tax by phone, if your local municipality allows it.  As with online payment, have your property tax statement handy so that you can provide all of the necessary information precisely.
   • Pay by mail.  Payment of this nature must be made in the form of a check made payable to a local government office as per the instructions on the statement.
   • Pay monthly.  Many seize the opportunity to pay a portion of their annual property tax each month as part of a monthly mortgage payment.  If you choose to pay property tax in this fashion and your mortgage company has requested to receive your statements, you will not receive a property tax statement in the mail.

Property tax requirements and payment options vary significantly from municipality to municipality; this article can serve as a general guide, but cannot substitute for local information.  Contact county and state treasury offices in order to pay your property tax with total confidence.