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Property Assessment and Taxable Value

HouseUnderstanding Your Property Assessment and Taxable Value

The Assessor’s Office spends a considerable amount of time analyzing arm’s length property sales that have occurred over a 24-month sale study period, as required by the State Tax Commission. Values are set as of December 31 (tax day) of every year. For the 2022 tax year, the sale study period determined by the State Tax Commission is April 1, 2019 through March 31, 2021.

In February of each year, property owners will receive a Notice of Assessment, Taxable Valuation, and Property Classification. The Notice provides the property owner with pertinent information regarding their property. The property owner should review three important areas of the notice.

  • The Notice provides the current year tentative valuations, the prior year valuations and the amount of change.
  • The document will show if the property’s taxable value was "uncapped" as a result of an ownership transfer. The Notice will indicate whether there "was" or "was not" a change of ownership of the property during the previous year. If there was a transfer of ownership, the taxable value will "uncap" and be the same as the Assessed Value.
  • The Notice will indicate the percentage of the property being used as a Principal Residence. If you own and occupy the property as your principal residence, in most circumstances the percentage indicated should be 100%. Property owners are encouraged to review each of these areas for accuracy. Please contact the Assessor’s Office if you should have any questions or concerns.

If the property owner disagrees with the Assessed Value on the Notice, they may appeal to the March Board of Review. The meeting dates are listed on the back of the Notice. Valuation disputes must be heard by the March Board of Review. The July and December Boards of Review do not have authority to hear valuation appeals.

Assessed Value represents 50% of the property’s estimated True Cash value. Taxable Value is a mathematical formula which is based on the preceding year’s Taxable Value increased or decreased by the Inflation Rate Multiplier (IRM). The 2022 IRM for the entire State has been determined to be 1.033 and is applied by each municipality. In addition to the IRM, Taxable Value may also increase for physical additions or decrease for physical losses. For the 2022 tax bills, the appropriate millage rates will be multiplied against the 2022 Taxable Value to determine the 2022 property taxes.

The following examples illustrate how the Taxable Value can change independently of the Assessed Value. If a homeowner has owned their home since the Constitutional Amendment, known as Proposal A passed in 1994, they could receive 2021 & 2022 value as follows

  Assessed Value Taxable Value
2021 $200,000 $160,000
2022 $200,000 $165,280 (2021 Taxable Value x 1.033 IRM)

The previous example shows that Assessed Values can remain the same, while Taxable Values show an increase. This is a function of the statute. Taxable Value can never be higher than the assessed value.

The March Board of Review does not have the authority to change Taxable Value unless a reduction is made to the Assessed Value that would affect the Taxable Value.

The IRM percentage is printed on the Notice of Assessment. Please review the Notice carefully by checking mathematical calculations, principal residence exemption percentage and transfer of ownership information. Should you have any questions or concerns about your Notice, feel free to contact the Assessor’s Office at 248-347-0485 or email the Assessing Department.