Understanding Property Taxes: What Homeowners Need to Know Before Year-End

Dec 7, 2023 | Property Taxes in Tennessee

If you are a new homeowner in Tennessee or plan to buy a home here, understanding property taxes is essential. Property taxes serve a vital function in the community. A failure to pay can also result in significant consequences. This post will explore the basics of Tennessee property taxes for homeowners.

Tennessee Real Estate Market Watch

The average home sale price in Tennessee during October 2023 was $342,200. However, real estate data is always changing. Contact the Title Group of Tennessee for title services when buying or selling a home in Tennessee.

Understanding Property Taxes in Tennessee

Property Tax Rates

The counties determine property taxes in Tennessee. That means your rate may vary depending on where you live. However, the counties charge property taxes based on a percentage of the property’s assessed value. For example, the current rate in Knox County is $1.5540 per $100 of assessed value. In Shelby County, the current rate is $3.39 per $100 of assessed value. In addition to county rates, you may also have additional property taxes from the municipality.

The Assessment Process

County assessors in your respective county will determine the property’s assessed value. Counties reassess property values every 4-6 years. The county assessor performs an appraisal to determine the property’s market value. They then multiply the value by the assessment ratio to determine the assessed value. In the case of residential property, the assessment ratio is 25%. That means if they appraise the property at $200,000, its assessed value would be $50,000.

When to Pay Property Taxes

Paying your property taxes on time is as important as paying the right amount. Tennessee property taxes are payable starting the first Monday in October for the tax year. Homeowners have until the end of February of the following year to make their complete payment. Failure to pay before March 1 can result in penalties. Starting from March 1, the county will add a penalty of 1.5% at the start of each month.

Where to Pay Property Taxes

Homeowners have several options for paying property taxes in Tennessee. The county offices should have a tax department for payments. You can also send a check or pay online. You might already be making tax payments with your mortgage if you have one.

Paying your property taxes is an important part of homeownership. Check your local county and city websites to learn more about paying your property taxes.

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