Ranking Property Taxes by State Property Tax Ranking

Because property taxes vary so much from state to state and even county to county, a home that’s affordable for you in one part of the country could be a budget buster in a different zip code. Revenue, with the United States deviating substantially from the OECD average on some sources of revenue. Meanwhile, Republican opposition to higher taxes of any kind remains staunch. Last week, Rep. Lisa C. McClain (R-Mich.) argued with White House budget director Shalanda Young about how much the wealthy should pay, noting that the top 1 percent of earners paid 42 percent of all income taxes in 2020.

A report from the Urban Institute, a nonprofit research organization, says that state and local governments collected $577 billion in property taxes in 2019 (the latest year for which national figures were available). Property taxes are part of the cost of owning a home and they are paid every year, so it’s good to know what those taxes are used for and where exactly your money is going. New York state spends more per public school student than any other state, at $23,091 per pupil, nearly double the national average. Almost half of the public school system’s revenue comes from property taxes – the state collects just over $2,900 per capita in property taxes per year, the fourth most of any state. Homeowners can deduct up to $10,000 ($5,000 if married filing separately) for a combination of property taxes and either state and local income taxes or sales taxes. Property tax is a levy on certain types of physical property, such as homes, real estate and land.

Assessment ratio

They point to very wealthy people, with almost no wage income, who live off their investments by obtaining tax-free loans before passing on tax-advantaged appreciated assets to heirs. This strategy — called “buy, borrow, die” — was detailed in a 2021 ProPublica investigation that helped focus fresh attention on the idea of taxing wealth rather than income. Owning land, homes, or other buildings can be expensive — here’s where people are paying more of their income on them.

Nevada is a popular tourist destination, and as such, the bulk of the state’s tax revenue comes from sales tax. Homeowners in New Jersey pay an average of 2.21% of their property value in taxes every year – the highest effective property tax rate of any state. Partially as a result, some 46.9% of state and local tax revenue in New Jersey comes from property taxes, well above the 31.9% average across all states.

Westchester County

Colorado offers residents a choice of big cities and more rural, mountain living, but both come with a pretty low tax rate in this state. When President Franklin D. Roosevelt took office in 1933, for instance, he boosted the top tax rate from 25 percent to 63 percent. And when President Ronald Reagan took office in 1981, a married real estate taxes couple was still paying a top marginal tax rate of 70 percent on every dollar earned over $215,400 — the equivalent of $730,000 today. Senate Budget Committee Chairman Sheldon Whitehouse (D-R.I.) said he thinks it would be worth the IRS’s time to conduct the type of complicated investigations needed to collect a wealth tax.

Indeed, states with higher effective property tax rates also tend to have higher than average per pupil education spending. While higher school spending alone does not necessarily improve outcomes, better funded schools can often more easily afford luxuries like smaller class sizes and a broader curriculum. Property taxes, or real estate taxes, are paid by a real estate owner to county or local tax authorities.