Chapter 13: Real Estate Taxes Flashcards
Ad Valorem
According to value; annual real estate taxes are ad valorem taxes
Assessed Value
A property’s value for ad valorem tax purposes as established by the county property appraiser
Debt Service
Annual mortgage payments, including principal and interest
Exempt Property
Real property excused for payment of ad valorem taxes
Immune Property
Real property that is never assessed or required to pay ad valorem taxes, such as government buildings
Installment Sale
When the buyer pays the purchase price over time in separate installment payments
Just Value
A fair and reasonable value; the property appraiser is required to assess properties at their Just Value
Like Kind Exchange
An exchange of one property for another with a deferral of tax consequences; also known as a “1031 exchange”
Mill
One one-thousandth (.001)
Special Assessment
A one-time tax assessed against a property that will directly benefit from some public improvement
Tax Rate
The millage rate; the tax rate is multiplied by the taxable value of a property to determine the levy
Taxable Income
Income that is subject to taxation
Taxable Value
Value of property for tax purposes determined by subtracting all exemptions from the assessed value
Time is of the Essence
Contractual clause indicating that all time deadlines will be strictly enforced; Failure to timely perform will result in an automatic default of contract
A one-time tax levied against properties that will directly benefit from a government expenditure or improvement is known as:
Special assessment
Bob and Terri have lived in their principal residence for the last three years. When they sell the property, they realized an $80,000 gain. If they are in the 35% tax bracket, how much money will they owe in taxes as a result of the sale?
$0
Which of the following is an example of an exempt property?
A Courthouse B Residential property C Church D Restaurant
C Church
The county property appraiser assesses real property according to its fair and equitable value, known as the:
Just value
Long term capital gains held for more than one year are taxed at what rate?
15%
Real property taxes begin to accrue on January 1st of each year. When are they first due and payable?
November 1st
Ed purchased a tax certificate in May. How many years must he wait before he may timely request a tax deed be issued?
Two years
Which of the following is an “ad valorem tax”?
Real property tax
If a property owner disagrees with assessed value determined by the county property appraiser, the first step for the property owner should be:
File a protest directly with the property appraiser’s office
How much is the highest interest rate bid allowed on a tax certificate auction?
18%
What type of laws are designed to provide farmers and agricultural property owners relief from high taxes by assessing their properties at a lower amount?
Greenbelt laws
