What is Tennessee Property Tax?
Editor’s Note: For purposes of this article, we will discuss taxes on real property in Tennessee.
Property tax is a type of taxation that requires owners of land and buildings to pay an amount of money based on the value of their real property, or land and buildings.
Within the U.S., state property taxes vary. For instance, your property taxes in Tennessee will differ from those in a different state. Read on to learn more about Tennessee property taxes!
How Do Property Taxes in Tennessee Stack Up?
The average American household pays $2,127 on property taxes on their homes each year. The average Tennessee household will likely pay less than that.
Who Owes Property Taxes?
If you own property as an individual or a business, you are required to pay Tennessee property tax. Even if the property was given to you through an estate or you own a rental property, you will still be held accountable for paying Tennessee property taxes.
How is Tennessee State Property Tax Calculated?
Local tax assessors take the property’s assessed value, the current assessment rate, and tax exemptions or property abatements into account in order to assess the value of the property. From there, property taxes are assessed based on the following calculation:
Assessed Value / 100 × Tax Rate (per hundred of assessed value) = Tax Amount
Assume you have a house with an APPRAISED VALUE of $100,000. The ASSESSED VALUE is $25,000 (25% of $100,000), and the TAX RATE has been set by your county commission at $3.20 per hundred of assessed value. To figure the tax simply multiply the ASSESSED VALUE ($25,000) by the TAX RATE (3.20 per hundred dollars assessed).
|$25,000/100 = 250 x $3.20 = $800.00||or||($25,000 x .03200 = $800.00)|
What is the Tennessee Property Tax Rate?
The Tennessee State property tax rate depends on the county you live in. View the Tennessee Comptroller of the Treasury for updated property tax rate information.
What Are Tennessee Property Taxes Used For?
The money collected by Tennessee is used for multiple public services throughout the state. It could be used for:
- First responders and other law enforcement
- General government services
- Municipal employee pay
- Municipal infrastructure
- Protective services
- Recreational services
- Resident services
How Do You Pay Tennessee Property Tax?
If you pay a mortgage, it’s likely you are already paying your Tennessee property taxes. This payment is made through an escrow account. A standard mortgage payment includes:
- Homeowner’s insurance
- Tennessee property taxes
Look at your current mortgage statement and determine if your Tennessee property taxes are paid with your monthly mortgage. It will likely be listed as a line item on the statement.
When Are Property Taxes Due?
Taxes become due and payable the first Monday of October and must be paid in full by the last day of February of the following year to avoid interest. On the first day of each month beginning March 1, interest of 1.5% (18% annually) will likely be added to your base tax amount for delinquent payments.
Where to Go for Tennessee Property Tax Help
Gauging how the property tax is calculated and the proper amount is important, otherwise, you may be paying too much, too little, or not at all. Beyond this, there is a federal real estate tax deduction you may be able to take.
If you’re looking for additional support for property tax questions, look no further. Consider using Tax Pro Go, a service that matches you with someone with the Tennessee-specific expertise. Tax Pro Go allows you to have your taxes done by a real tax pro without visiting an office. Get matched with a tax pro, upload your tax documents, and we do the rest.
Taking these local state tax laws into consideration, you’ll feel confident you’re maximizing your tax outcome.
What is e-filing? Learn more about e-filing your taxes and get answers from H&R Block.
Learn if you can deduct medical expenses on your state tax return with advice from the tax experts at H&R Block.
Looking for more information about your California refund? Find out details on how to check your refund status, who to contact, and more from H&R Block.
If you are paying child support for your children, but they don't live with you, can you claim them as dependents? Get Tax Answers from H&R Block.