Property Tax Definitions

• Appraised Value (also called the Fair Market Value) – the amount a knowledgeable buyer would pay for the property and a willing seller would accept for the property at an arm’s length, bona fide sale
• Assessed Value – the amount that is calculated by taking 40% of the appraised value
• County Board of Assessors – a Board comprised of local citizens and named by the county board of commissioners to oversee property tax appraisals and assessments. Other than appointing the members of the board of assessors, county commissioners play no role in determining appraised or assessed values of property.
• Exemptions – reductions that are subtracted from the assessed value of a property. The state provides a statewide $2,000 Homestead Exemption. Many counties, school boards, and cities also provide a variety of local homestead exemptions for their residents
• Local Governing Authorities – the elected officials responsible for overseeing government operations within established boundaries or jurisdictions within a county, including the county board of commissioners, city councils and the board of education. Local governing authorities each develop a budget and set a millage rate independently of each other. For example, county boards of commissioners have no authority to approve, deny or amend the budgets or millage rates levied by school boards or cities.
• Millage Rate – an amount established by a local governing authority to fund the budget that is based on the total tax digest for a given jurisdiction. One mill equals $1 for every $1,000 of net assessed value.
• Tax Commissioner – the elected official responsible for billing, collecting and distributing tax dollars to the appropriate local governing jurisdiction. The tax commissioner is not responsible for determining appraised or assessed values of property within the county.
• Tax Digest – the assessed value of all properties within a specified local governing jurisdiction