Estimating the Real Estate Tax on a Property Before You Buy

 

Homebuyers need to plan ahead for property taxes and are well-advised to research the property before they make an offer to purchase a home.  Buyers can contact the local assessor's office or view the township and county websites to acquire information about the property.  By state law, the Assessor only sets the assessed valuation of the property based on a three-year weighted average of sales; they do not determine the tax bill. 

Property taxes are called ad valorem ("according to value") taxes, and are calculated annually based on the assessed value of the property. Generally, when a home is sold, the assessed value is reviewed -- the assessor considers the sales price to be a reflection of the fair market value (definition) of the homes in the surrounding area.

It's relatively easy to figure out how much to budget for this expense.  The first step is to collect the following information:

* Recent assessed value or sales price of the home

* Value of comparable homes in the area

* Improvements that add value to the home

* Exemptions for which the property qualifies for

* Applicable property tax rate set by the taxing authority

 

To "estimate" the "approximate" property tax obligation on a home:

1. Multiply the purchase price by .3333  (If sold as an "Arms Length Transaction")

The assessed value of the property is 33-1/3% of its fair cash value

(i.e. a $100,000 purchase price x .3333 = $33,330 assessed value)

2. Deduct any exemptions for which the home or homeowner qualifies from the assessed value. The most common exemption in Kane County is the Homestead Exemption of $6,000 (This exemption is applied to owner occupied homes only)

($33,330 - $6,000 = $27,330 net taxable value)

For a complete list of Kane County exemptions and details on how to apply click HERE

3. Multiply the net taxable value by the current tax rate to find the most likely amount to expect on the tax bill

($27,330 x 9.862077%[1] = $2,695 estimated tax amount) Multiple exemptions and varying tax rates will affect the calculation outcome.  

Contact the Kane County Clerk's office for more details or the Treasurer's office for a chart of average property tax bill by township.

Homeowners may feel unfairly targeted by this particular tax burden however they are necessary to run and operate local government and municipalities. Property taxes pay for schools, libraries, fire protection, police, streets and many other public benefits.  For more information on "Where Does My Money Go" check out the Frequently Asked Questions link on the county's website.

 


[1] Most common tax rate in Batavia Township 2014

 

Assessor's Office Information

Monday through Friday
8:00 a.m. - 4:00 p.m.
Ph (630) 879-1323
Fax (630) 879-1009

Supervisor's Office Information

Monday through Thursday
8:00 a.m. - 2:00 p.m.
Ph (630) 879-1392 Fax (630) 879-1411

General Assistance Office

Monday through Thursday
9:00 a.m. - 2:00 p.m.
Ph (630) 879-1392 Fax (630) 879-1411

Highway Department Information

Ph (630) 879-5515