Property Tax Calculator
Estimate your annual property tax bill using your home's assessed value and the local mill rate. Useful for homebuyers, homeowners budgeting for escrow, or comparing tax burdens across neighborhoods.
About this calculator
Property tax is assessed by local governments based on the value of real estate you own. The standard formula uses the mill rate: Property Tax = (Home Value × Mill Rate) / 1000. A mill equals one-tenth of one cent, or $1 of tax per $1,000 of assessed value. For example, a mill rate of 15 means you owe $15 for every $1,000 of assessed value. Note that taxing authorities often assess property at a fraction of market value — called the assessment ratio — so the figure you should enter is the assessed value, not necessarily the market value. Mill rates vary by municipality and fund services like schools, fire departments, and roads.
How to use
Suppose your home has an assessed value of $320,000 and your town's mill rate is 18.5 mills. Enter 320000 as Home Value and 18.5 as Mill Rate. The calculator computes: Property Tax = (320,000 × 18.5) / 1,000 = $5,920 per year. Divide by 12 to get your monthly escrow contribution: $5,920 / 12 ≈ $493.33 per month. This helps you plan total housing costs beyond just your mortgage principal and interest.
Frequently asked questions
What is a mill rate and how is it set by local governments?
A mill rate (also called a millage rate) is the amount of tax payable per $1,000 of assessed property value. Local governments — typically counties, municipalities, and school districts — calculate the mill rate each year by dividing the total revenue they need to raise by the total assessed value of all property in the jurisdiction. If a town needs $10 million and the total assessed value is $1 billion, the mill rate is 10. Rates are voted on or set by elected officials and can change annually based on budget needs.
How does assessed value differ from market value for property tax purposes?
Market value is what a willing buyer would pay for your home in an open market transaction. Assessed value is the figure your local assessor assigns for tax purposes, which is often a fixed percentage of market value called the assessment ratio. For example, if your home is worth $400,000 and the assessment ratio is 80%, your assessed value is $320,000. The mill rate is then applied to the assessed value, not market value. If you believe your assessment is too high, you can formally appeal it through your local assessor's office.
Why does property tax vary so much between states and counties?
Property tax is a local tax, so rates depend on the spending decisions of each individual government entity — school districts, counties, cities, and special districts like fire or water authorities. States with high property taxes (like New Jersey or Illinois) often have fewer other revenue sources or higher per-pupil school spending. States with low property taxes (like Hawaii or Alabama) may rely more heavily on income or sales taxes. Even within a single state, a home in one county can face a mill rate two or three times higher than a neighboring county.