Property Tax Calculator

What is property tax?

Property tax is an annual ad valorem levy on real estate, collected by your county, city, school district, and any special districts that cover the parcel. The revenue stays local: it pays for public schools, roads, police and fire departments, water systems, parks, and courts. It does not go to the state or federal government, which is why two houses of identical value in different counties can produce tax bills that differ by thousands of dollars.

The cost is usually stated as an effective rate applied to your home's value. Across the United States the average effective rate is roughly 1.1% of home value a year. On a $450,000 home that is $4,950 a year, or $412.50 a month. The average conceals an enormous spread: Hawaii sits near 0.32% while New Jersey runs about 2.23%, so the identical house carries a $1,440 bill in Honolulu and a $10,035 bill in Bergen County — a difference of $8,595 a year, or $716.25 a month, for the same structure.

Assessed value is not market value. Most states apply an assessment ratio to your home's value to produce the taxable figure, and that ratio is 100% in many states but lower in others. On top of the ratio sit exemptions: a homestead exemption on your primary residence, additional reductions for homeowners over 65, and full exemptions for qualifying disabled veterans. Assessment caps do the same job in reverse — California's Proposition 13 limits annual increases in assessed value to 2% until the property sells, which is why a long-time owner in Los Angeles can pay a fraction of what a new buyer in the same house would owe.

Most mortgaged homeowners never write a check to the county directly. Your servicer escrows the tax: you pay one-twelfth of the annual estimate each month, the lender holds it, and the county is paid when the bill comes due. Escrow changes the timing, not the total — the annual bill is identical whether you pay it in twelve installments or one lump sum. Use the calculator above to size the number before it appears in your payment.

How to use this calculator

1. Enter your home's value — the purchase price for a new buy, the current estimate if you already own it.
2. Select your state. The calculator pre-fills that state's average effective rate so you start from a defensible baseline.
3. Adjust the assessment rate if your state assesses below 100%. At 100%, assessed value equals market value; at an 80% ratio a $450,000 home is taxed on $360,000.
4. Enter your tax rate if you know your county's actual figure. Your assessment notice, tax bill, or county assessor's website shows the rate in mills or as a percentage.
5. Calculate to see annual property tax, the effective dollar rate per $100,000 of value, and the monthly escrow amount that lands in your mortgage payment.

A realistic set of inputs for 2026: home value $450,000, state average effective rate 1.10% (the national average used in the worked examples below), assessment rate 100%, no exemptions applied. The result is $4,950 a year and $412.50 a month. If you know your county's real millage rate, enter that instead — state averages hide large local variation. In Texas the state average is about 1.68%, which turns the same $450,000 home into $7,560 a year and $630.00 a month, or $217.50 more every month than the national-average figure. In Hawaii at 0.32%, the bill falls to $1,440 a year and $120.00 a month. Always budget from your county's number, and confirm what the seller actually paid using the most recent tax bill — see the closing cost calculator for the prepaid taxes due at the table.

How property tax is calculated

The calculation has two steps: determine what the county is allowed to tax, then apply the rate. Stated as a formula, with the millage version used by most assessors.

Annual tax = assessed value × effective tax rate = (assessed value ÷ 1,000) × millage rate

Assessed value is your home's value times the assessment ratio, less any exemptions. The rate can be quoted two ways — as a percentage of assessed value or as mills, where one mill is $1 of tax per $1,000 of assessed value. Eleven mills and 1.1% are the same rate: 11 ÷ 1,000 = 0.011 = 1.1%. Monthly escrow is the annual figure divided by 12.

Worked example: $450,000 home at a 1.1% effective rate

Step 1: market value is $450,000 and the assessment ratio is 100%, so assessed value is $450,000. Step 2: 1.1% equals 11 mills, written as $11 of tax for every $1,000 of assessed value. Step 3: 450,000 ÷ 1,000 = 450 units of $1,000, and 450 × 11 = $4,950 of annual tax. Step 4: monthly escrow is 4,950 ÷ 12 = $412.50. Step 5: apply a $50,000 homestead exemption and the taxable base drops to $400,000, so 400,000 × 1.1% = $4,400 a year, $366.67 a month, a saving of $550 a year or $45.83 a month.

Notice which input dominates. The rate moves tax proportionally — raise it from 1.1% to 1.68% and the bill goes from $4,950 to $7,560 with no change in the house. The exemption moves the base instead, and a $50,000 exemption is worth $550 a year at any rate above zero. Both levers appear in your annual assessment notice, and both are worth reading before you assume the bill is fixed.

Worked scenarios

Three questions cover nearly every decision that touches property tax: where the house sits, what it is worth, and what exemptions apply. Each table below isolates one of those variables while holding the others constant.

The same $450,000 home in five states

The New Jersey bill is about seven times the Hawaii bill on an identical home — $8,595 a year and $716.25 a month apart. That gap is larger than the effect of a full percentage point of mortgage rate on a $400,000 loan, and it compounds every year you own. States that do not collect a broad personal income tax often lean harder on property tax to fund the same services, and Texas at 1.68% is the clearest example, so a relocation decision that ignores the tax line is comparing only part of the cost. Model the housing side of any move with the rent vs buy calculator.

How home value moves the bill at a 1.1% rate

Escrow rises $91.67 a month for every $100,000 of value at a 1.1% rate. Between the $300,000 house and the $750,000 house, the tax line alone differs by $412.50 a month — which at the 28% front-end guideline consumes $1,473 of gross monthly income in borrowing capacity. This is the number buyers most often leave out when they shop on price, and it is why the affordability calculator treats tax as a first-class input rather than a footnote.

Exemptions on a $450,000 primary residence

Exemptions are applied by the county assessor, not automatically by your lender or your servicer. You file, the assessor approves, and the reduction appears on the following tax year. Most states set a filing deadline tied to occupancy — file in the year you move in and you keep a full year of the saving; file late and you may lose it until the next cycle. Check your county's list before closing: homestead, senior, veteran, disability, and agricultural exemptions each reduce the taxable base, and many eligible owners never claim them.

Key details

• Average effective rate: roughly 1.1% of home value a year across the U.S. — $4,950 on a $450,000 home, or $412.50 a month escrowed.
• State range: about 0.32% in Hawaii to 2.23% in New Jersey, with Illinois near 2.08% and Texas near 1.68%. On a $450,000 home that spread is $8,595 a year.
• Assessment ratio: many states assess at 100% of market value; others assess at 80% or another fraction. Enter the correct ratio or your estimate will be off by that percentage outright.
• Millage rate: one mill is $1 per $1,000 of assessed value, so 11 mills is 1.1%. School districts, counties, and special districts each add their own mills, and they are stacked into a single total on your notice.
• Escrow: annual tax ÷ 12 = monthly escrowed payment. Your servicer sends the county the full bill when due and re-analyzes the account annually, adjusting your payment up or down for the next year.
• Reassessment: most states reassess on transfer of ownership, so expect the bill to reset toward purchase price in year one or two. A home bought for $450,000 taxed on a basis of $300,000 will not stay at $3,300 a year.
• Deduction: property tax is deductible on Schedule A when you itemize, combined with your state and local income or sales taxes under one federal cap — so the benefit depends on your total state and local tax burden, not on the property tax alone.
• Appeals: assessment appeals are free, filed with the county board, and decided on comparable sales. An assessor who has the wrong square footage, a missing exemption, or an outdated condition on file is corrected through that process.

Property tax tips for 2026

1. File the homestead exemption the year you close. It is the highest-return administrative task in homeownership: a $50,000 exemption on a $450,000 home is worth $550 a year, $45.83 a month, for as long as you occupy the residence. Deadlines vary by state and missed filings are rarely applied retroactively, so submit the form with your deed or immediately after recording.
2. Get the seller's actual tax bill before you bid. The state average is a starting point; the previous owner's bill is the truth, because it reflects the parcel's real assessment ratio, exemptions, and millage. Ask for the current year notice and model it in the calculator — a $450,000 price carrying a $7,560 bill is a very different payment from one carrying $4,950.
3. Budget for reassessment, not for the inherited bill. When a property transfers, most states reassess toward the sale price. If the seller's basis is $150,000 below your purchase price, expect roughly $1,650 more a year at a 1.1% rate — $137.50 a month added to escrow within the first two cycles.
4. Read the assessment notice and compare it to real comps. If the notice says $525,000 and three sales on your street closed between $440,000 and $470,000, you have a documented appeal. File by the deadline printed on the notice with those comps attached; boards correct over-assessments far more often than they grant reductions for the asking.
5. Separate tax from insurance when escrow rises. An escrow shortage can come from either line. Pull the annual escrow analysis, confirm which component moved, and re-shop the insurance if premiums jumped — a $600 insurance increase and a $600 tax increase look identical in your payment but have different fixes.
6. Ask about special district levies. New developments, school bonds, and infrastructure districts add mills on top of the base rate, sometimes 0.2% to 0.5% of value. That is $900 to $2,250 a year on a $450,000 home, and it is disclosed in the parcel data rather than in the listing. Confirm the figure before using the mortgage calculator to set your payment.

Common mistakes

• Budgeting from a state average. State averages vary by more than a factor of seven, and county rates inside one state can differ by half again. Using 1.1% in a 1.68% market understates escrow by $217.50 a month on a $450,000 home — a $2,610 annual error that appears the first time the servicer re-analyzes the account.
• Assuming the seller's bill carries over after closing. Transfer usually triggers reassessment at your purchase price. Buyers who qualify on a payment built from the seller's inherited basis discover the real number in year two, when escrow jumps $100 to $200 a month.
• Confusing assessed value with market value. They diverge whenever an assessment ratio, a cap, or a stale valuation is involved. Entering the market value while the county taxes an assessment of 80% of it overstates the bill by 25%: on a $450,000 home the correct figure is $3,960 a year and the estimate reads $4,950.
• Assuming exemptions apply automatically. Homestead, senior, veteran, and disability exemptions require an application to the assessor, usually with an occupancy deadline. Lenders do not file them and servicers do not track them. Not filing is the most common way homeowners overpay by hundreds or thousands of dollars a year.
• Treating escrow as fixed. Escrow is a monthly installment of an estimate, and the estimate changes when the assessment, the millage, or the insurance premium changes. A payment that fits at closing can be $125 a month higher in three years without any action on your part — stress-test your budget above the quoted figure.
• Comparing states on income tax alone. Texas collects no personal income tax but runs one of the higher property tax rates in the country — about 1.68% on this example, which is $7,560 a year on a $450,000 home against $4,950 at the national average. Add both taxes together before treating a low-income-tax state as cheaper.

Frequently asked questions

How is property tax calculated? Multiply your home's assessed value by the local tax rate. Assessed value is typically market value times the assessment ratio, minus exemptions. A $450,000 home assessed at 100% with a 1.1% rate owes $4,950 a year, or $412.50 a month in escrow. Expressed in mills, the same rate is 11 mills, and 450 units of $1,000 times $11 produces the same $4,950.

What is the average property tax rate in the United States? Roughly 1.1% of home value a year, which is $4,950 annually on a $450,000 home. The state range is extreme: about 0.32% in Hawaii, 0.39% in Alabama, and 0.55% in Colorado at the low end, against 1.68% in Texas, 2.08% in Illinois, and 2.23% in New Jersey at the top.

Is assessed value the same as market value? No. Assessed value is what the county taxes, and it comes from applying an assessment ratio to market value — often 100%, but not always. Caps can hold the assessed figure below market for years: California limits annual growth to 2% until sale, while most states reassess fully when ownership transfers to a new buyer.

How does escrow work for property taxes? Your servicer collects one-twelfth of the estimated annual tax with each mortgage payment, holds the funds in an escrow account, and pays the county when the bill is due. A $4,950 annual bill becomes $412.50 a month. The servicer re-analyzes the account yearly, so if the assessment rises to $5,400, your payment adjusts upward by $37.50 a month.

Are property taxes deductible? Yes, when you itemize on Schedule A. The deduction combines with your state and local income or sales taxes under a single federal cap, so the amount you actually recover depends on your total state and local burden and your marginal bracket. Homeowners who take the standard deduction get no federal benefit from the property tax paid.

How often is my home reassessed? It depends on the state. Some reassess annually, others every three to five years, and California reassesses only on sale or new construction. Nearly every jurisdiction reassesses when the property sells, which is why a new owner should expect the bill to move toward the purchase price within one or two tax cycles.

Can I appeal my assessment? Yes, and the process is free. File with your county board by the deadline on the assessment notice and support the claim with three to five comparable sales, plus documentation of any condition the assessor recorded incorrectly — square footage, year built, or an unrecorded exemption. Boards adjust assessments regularly when the comps clearly disagree with the notice.

Does my mortgage company pay my property tax? Only if your loan has an escrow account, which most lenders require when you put down less than 20%. With escrow, you pay monthly and the servicer pays the county. Once you reach 20% equity you can usually waive escrow and pay the county directly, though the annual bill — $4,950 on this example — then arrives as a single lump sum.

Related calculators

• Mortgage Calculator — full PITI payment with taxes escrowed
• Affordability Calculator — tax-included buying power
• Closing Cost Calculator — prepaid taxes due at closing
• 30-Year Mortgage Calculator — payment and amortization detail
• Rent vs Buy Calculator — tax as a cost of owning
• Refinance Calculator — escrow and payment after a refinance