How the property tax calculator works
A property tax calculator multiplies a property’s taxable value by the tax rate where it sits. This one gives you a quick estimate from your state’s average effective rate, and a closer one when you enter the rate printed on your county or city tax bill.
Effective rates come from the Tax Foundation’s Facts & Figures 2026, which divides property taxes paid by the value of owner-occupied homes using 2024 U.S. Census Bureau American Community Survey data. A state average is a starting point, not a bill. Rates inside one state can differ by a factor of two or more between counties, and rental and commercial property is often taxed differently from the owner-occupied homes the average is built on.
- State: choose one from the list and the calculator fills in that state’s average effective rate.
- Property value: enter market value, or the price you expect a buyer to pay.
- Local rate override (optional): enter the combined rate from your tax bill or assessor’s website. It replaces the state average. Enter it as a percent; 25 mills is 2.5%.
- Assessment ratio (optional): if your state taxes a fixed share of market value, enter that share (for example, 40% in Georgia). Leave it blank when your rate already applies to full market value, which is true of every state average in the calculator.
- Number of units (optional): enter it to see the tax per unit, the figure buyers and lenders compare on apartment buildings.
How to calculate property tax
To calculate property tax, multiply the assessed value by the tax rate, then subtract any exemptions or credits you qualify for. The formula is simple; the hard part is knowing which value and which rate apply to your property.
Step one is market value: what the assessor thinks the property would sell for on the valuation date. Step two is assessed value, which is market value times the state’s assessment ratio. Step three is taxable value, which is assessed value minus exemptions such as a homestead exemption. Step four is the rate: the sum of every levy that applies at your address, including county, city, school district and special districts. Tax equals taxable value times the rate.
| Step | Formula | Example |
|---|---|---|
| Market value | Set by the assessor | $100,000 |
| Assessed value | Market value × assessment ratio | $100,000 × 40% = $40,000 |
| Taxable value | Assessed value − exemptions | $40,000 (no exemptions) |
| Tax | Taxable value × rate | $40,000 × 25 mills = $1,000 |
What mills are and how to convert them
A mill is one dollar of tax for every $1,000 of assessed value, or one-tenth of one percent. The Georgia Department of Revenue uses this example: a $100,000 home assessed at 40% has an assessed value of $40,000, and at 25 mills the tax is $1,000.
To convert, divide mills by 10 to get a percent (25 mills is 2.5%), or divide by 1,000 to get a decimal (0.025). Some places quote rates per $100 of value instead; Texas and Virginia bills often do. A rate of $2.10 per $100 is 2.1%, or 21 mills.
Remember that a millage rate applies to assessed value, not market value. In a state that assesses at 40%, 25 mills works out to an effective rate of 1.0% of market value (25 mills × 40%). That is why the calculator has a separate assessment ratio field: enter the mills as a percent and the ratio, and it does the multiplication.
How assessment ratios work
An assessment ratio is the share of market value that is taxed. Some states tax 100% of market value, others tax a fixed fraction, and some use different ratios for homes, rentals and commercial buildings.
Georgia assesses property at 40% of fair market value. Michigan sets state equalized value at 50% of true cash value. Many states, including Texas and Florida, assess at full market value and then apply exemptions and caps. A lower ratio does not mean lower taxes, because local governments set the rate high enough to raise the money they need. A 40% ratio with a 30-mill rate and a 100% ratio with a 12-mill rate produce the same bill.
If your bill shows an assessed value lower than market value, divide the two to find your ratio. If your local rate is already an effective rate on market value, leave the ratio blank or enter 100%.
Property tax rates by state: 10 highest and 10 lowest
New Jersey and Illinois have the highest average effective property tax rates of the states we cover, at 1.88% each, according to the Tax Foundation’s Facts & Figures 2026 (2024 Census ACS data). Alabama has the lowest at 0.37%.
These are averages for owner-occupied homes across each state. The full list of 47 states sits behind the state dropdown in the calculator.
| Rank | Highest rate states | Effective rate | Lowest rate states | Effective rate |
|---|---|---|---|---|
| 1 | New Jersey | 1.88% | Alabama | 0.37% |
| 2 | Illinois | 1.88% | Arizona | 0.48% |
| 3 | Connecticut | 1.54% | Utah | 0.48% |
| 4 | Vermont | 1.51% | South Carolina | 0.49% |
| 5 | New Hampshire | 1.50% | Colorado | 0.50% |
| 6 | Nebraska | 1.44% | Idaho | 0.50% |
| 7 | Texas | 1.40% | Nevada | 0.50% |
| 8 | Ohio | 1.36% | West Virginia | 0.51% |
| 9 | Iowa | 1.33% | Tennessee | 0.52% |
| 10 | Wisconsin | 1.32% | Wyoming | 0.53% |
Worked example: a house in Texas and a 20-unit building in Georgia
A $400,000 house in Texas at the state average of 1.40% comes to $5,600 a year, or $466.67 a month. That is only a starting figure. Texas has no state property tax; the bill is the sum of county, city, school district and special district rates, and many homeowners subtract a homestead exemption from the school portion.
Now a 20-unit apartment building in Georgia with a market value of $3,000,000 and a combined local rate of 30 mills. Enter $3,000,000, a local rate of 3.0% and an assessment ratio of 40%. The assessed value is $1,200,000. The tax is $1,200,000 × 0.030 = $36,000 a year, or $3,000 a month. With 20 units entered, that is $1,800 per unit per year.
The effective rate on that building is 1.2% of market value ($36,000 ÷ $3,000,000), higher than Georgia’s 0.79% state average. Rental buildings often land above the state average because they do not get homestead exemptions and because apartment buildings tend to sit in cities with higher combined rates.
Reassessment on sale: why the buyer’s bill can jump
In several states a sale resets the assessed value to the price paid, so the new owner’s tax bill can be much higher than the seller’s. Buyers underwrite the reset bill, which is why it affects what they will pay for your building.
- California: Proposition 13 limits the general tax to 1% of taxable value plus voter-approved debt, and limits annual increases in base year value to 2%. Property is reassessed to market value only on a change in ownership or new construction (State Board of Equalization, Publication 29).
- Florida: non-homestead property, which includes apartment buildings, cannot rise more than 10% a year in assessed value, but after a change of ownership or control it is assessed at just value as of January 1 of the following year (Florida Statutes 193.1555).
- Michigan: annual growth in taxable value is capped at the lesser of 5% or inflation, and the cap comes off in the year after a transfer, when taxable value jumps to state equalized value (Michigan State Tax Commission).
- States without an acquisition-value system still revalue on a schedule, and many assessors use recorded sale prices as evidence. A recent sale at a high price often shows up in the next reassessment.
A California example of the post-sale reset
Say a seller bought a 16-unit building in California in 2005 for $1,100,000. If the base year value rose the full 2% every year since, the 2026 taxable value is about $1,667,000. At a combined rate of 1.1% (the 1% general tax plus voter-approved debt), the bill is about $18,300.
A buyer who pays $2,600,000 gets a new base year value of $2,600,000 and a bill of about $28,600 at the same 1.1% rate, an increase of roughly $10,300 a year. At a 6% cap rate, $10,300 of lost NOI is worth about $171,000 of price. Sellers who expect the buyer to underwrite the seller’s own tax bill are usually surprised by the offers they get.
How to read the result
The annual figure is the estimated tax for one year at the value and rate you entered. The monthly figure is that amount divided by 12, which is what an escrow account or a monthly operating budget would set aside. The per-unit figure divides the annual tax by the number of units.
Per-unit tax is the number to compare across apartment buildings. Two buildings with the same price can carry very different tax loads, and buyers look at tax per unit next to rent per unit to see how much of each rent check goes to the county. If your result is well above similar buildings nearby, that is a sign to check the assessment.
Keep in mind what the estimate leaves out: special assessments for sidewalks or sewers, fire and water district fees billed separately, and any abatement or exemption you hold.
Property tax on an apartment building: per unit, share of rent and value
On an apartment building, property tax is usually one of the largest operating expenses, so it pays to look at it three ways: per unit, as a share of rent and as a hit to value. The calculator gives you the first. The other two take a minute with the rent roll.
Take a hypothetical 24-unit building with a $45,000 annual tax bill and rents of $1,250 a unit. Enter 24 units and the calculator shows $1,875 per unit per year, or $156.25 a month. Gross scheduled rent is 24 × $1,250 × 12 = $360,000, so the tax takes 12.5% of every rent dollar before vacancy, insurance or repairs.
Now say the county raises the assessment 10% and the rate stays the same. The bill rises $4,500, and net operating income falls by the same $4,500. Buyers price apartment buildings off NOI, so at a 6.5% cap rate that lost income is worth about $69,231 of sale price ($4,500 ÷ 0.065). Every dollar of recurring tax increase costs the owner roughly 15 dollars of value at that cap rate, which is why an assessment appeal on a large building can be worth more than a year of rent increases.
| 24-unit example | Figure |
|---|---|
| Annual property tax | $45,000 |
| Tax per unit per year (per month) | $1,875 ($156.25) |
| Tax as a share of gross scheduled rent | 12.5% |
| Tax increase after a 10% higher assessment | $4,500 a year |
| Value lost at a 6.5% cap rate | About $69,231 |
How to lower or check your property tax bill
You lower a property tax bill by reducing the taxable value: correct errors on the assessment, claim the exemptions you qualify for, and appeal when the assessor’s value is above what the property would sell for.
- Read the assessment notice when it arrives. Appeal windows are short, often 30 to 45 days from the notice date, and vary by state.
- Check the property record card for wrong unit counts, square footage or building class.
- For an apartment building, an income approach usually carries more weight than recent home sales. Bring a trailing 12-month operating statement and the rent roll to an appeal.
- Ask about exemptions and abatements for affordable or rent-restricted units; many states have them.
Selling a building with a high tax bill
High or rising property taxes are one of the most common reasons owners decide to sell. If the bill is eating your cash flow, or a reassessment is coming, it helps to know how a buyer will see it before you list.
Skyline Capital Investments buys apartment buildings with five or more units across 47 states. We buy directly, close on your timeline, and can work inside 1031 deadlines. Send us the address, the unit count and your current tax bill, and we will tell you how we would underwrite it.
