Are property taxes deductible?
Property taxes on all real estate, including those levied by state and local governments and school districts, are fully deductible against current income taxes.
Are taxes on second homes deductible?
Mortgage interest and property taxes are deductible on a second home if you itemize. Check with your accountant or tax advisor for specifics.
How do property taxes work?
Property taxes are what most homeowners in the United States pay for the privilege of owning a piece of real estate, on average 1.5% of the property's current market value. These annual local assessments by county or local authorities help pay for public services and are calculated using a variety of formulas.
Where can I learn more about appealing my property taxes?
Contact your local tax assessor's office to see what procedures to follow to appeal your property tax assessment. You may be able to appeal your assessment informally. Most likely though, you will have to go through a formal tax-appeal process, which begin with an appeal filed with the appropriate assessment appeals board.
What is an impound account?
An impound account is a trust account established by the lender to hold money to pay for real estate taxes, and mortgage and homeowners insurance premiums as they are received each month.
Do all loans require impound accounts?
If you are taking out an FHA or VA loan, the lender can require an impound account to pay real estate taxes and hazard insurance premiums, as with a standard loan. Most conventional loans do not require an impound account.
How is a home's value determined?
There are several ways to determine the value of a home. An appraisal is a professional estimate of a property's market value, based on recent sales of comparable properties, along with location, square footage and construction quality of the home. This services varies in cost depending on the size and price range of the home. The cost for an appraisal can often start at $400 for a small, single story home.
A comparative market analysis is an informal estimate of market value performed by a real estate agent based on similar sales and property attributes. Most agents offer free analyses in the hopes of winning your business. You also can get a comparable sales report for a fee from private companies that specialize in real estate data, or you can find comparable sales information available on various real estate websites.
