What Determines Property Tax in Arizona? – Suburban Snacks Episode 93
Hello everybody, welcome back to Suburban Snacks. I’m Cristy Olof and this month’s snack is chocolate covered pretzels. Before we review the snack, we will be informing you about what determines Property Tax in Arizona. Property taxes play a crucial role in generating revenue for local governments in Arizona. These taxes are essential for funding public services, such as schools, roads, and public safety. Understanding the factors that determine property tax in Arizona is important for homeowners, potential buyers, and anyone interested in the state’s taxation system.
In this video, we will explore the key elements that influence property tax calculations in Arizona. The valuation of a property is a fundamental aspect of determining property tax in Arizona thus a valuation is based on factors such as property size, location, improvements, and recent sales data. The County Assessor’s Office assesses the market value of each property within its jurisdiction annually. Arizona counties calculate a full cash value of every house in the county, often based on the sales prices of nearby, comparable homes.
Taxes are not based on the full cash value, however, but something called the Limited Property Value (LPV), which is based on cash value. The purpose of the Limited Property Value (LPV) was to create a hedge against inflation increases in the market value of the property. For primary residences, the LPV is based on a fraction of the property’s market value. This fraction is currently set at 10% of the property’s full cash value. Once the assessed value is established, it is multiplied by the applicable tax rate to determine the property tax amount. Tax rates are set by various taxing jurisdictions, including county governments, school districts, fire districts, and other local entities. Each jurisdiction sets its own tax rate, which may vary based on their budgetary needs and requirements.
The tax rates are typically expressed as a rate per $100 of assessed value. For instance, if the tax rate is $5 per $100 of assessed value, a property with an assessed value of $30,000 would incur a tax of $1,500. Arizona offers several exemptions and deductions that can reduce the taxable value of a property or provide relief for certain property owners. Common examples include exemptions for disabled veterans, senior citizens, and widows or widowers. These exemptions and deductions are subject to specific eligibility criteria and application processes, which vary depending on the type of exemption. So if you are someone looking to purchase or sell a home in Southern Arizona, then we at Suburban would love to help!
Do you like chocolate covered pretzels? Let us know in the comments below. That’s going to do it for us here at Suburban Snacks. If you have any questions or would like to get into contact with us feel free to check out our website at suburbanrealestategroup.com. Thanks for watching, my name is Cristy Olof and we will see you in the next one!