We know many property owners are concerned about how rising home values will translate into property taxes. It is true that many property owners will see an increase in taxes, but you should know that a 37% increase in values will not result in a 37% increase in taxes. Taxes will not go up at nearly the same rate as values. We estimate that taxes will increase 4-6%, on average, as a result of this property value update.
Below are some FAQs to help explain how this property value update will impact property taxes.
- Why won’t taxes increase at the same rate as values?
Values and taxes do not have a one-to-one relationship. Ohio law protects property owners from experiencing large increases in taxes as a result of large increases in values.
Levies make up most of each property owner’s tax bill. Besides some very rare exceptions, levies always generate the same amount of revenue as when they were first approved by the voters. As property values increase, like they will in 2023, the tax rates of those levies will be lowered to ensure no additional taxes are generated.
So, as a whole, levies won’t generate more taxes due to the increases in values.
- So what will cause taxes to increase?
Levies make-up most of the tax rate that you see on your property tax bills. As a whole, levies won't generate more taxes due to the increase in values. However, the property value update will change the share of the levies that each property owner pays. As a rule of thumb:
The rest of your tax rate comes from "inside millage." This small, unvoted portion of each property's tax rate is primarily responsible for the increases in taxes that communities will see as a result of this property value update. "Inside millage" charges increase proportionally, one-to-one, with increases in value.
Finally, separately from the property value update, new money levies that pass in 2023 will increase property taxes in 2024.
- Do you have an estimate of how much taxes will increase?
We estimate that taxes will increase about 4-6% on average due to this increase in values.
Put differently - for every $100,000 of a home's value, the owner will see about a $104 annual increase in their property taxes, on average, due to a 34% increase in value.
The tax impact of the new values will vary from property to property and from community to community. But as a rule of thumb:
You can look at our Sales Dashboard tool to find your property's value increase as well as your community's average value increase.
- Can you calculate how much my taxes will change?
If we could, we would. Unfortunately, we won’t know the amount of your 2024 property taxes until the end of 2023.
We cannot reliably estimate 2024 tax payments for individual properties at this time because tax rates will be adjusted at the end of 2023. Tax rates will change based on multiple factors that we cannot predict, including levies on the November ballot, property value changes throughout Montgomery County, and even property value changes in neighboring counties.
At the end of 2023, you will be able to look up the amount of your 2024 tax bill on www.mcrealestate.org.
- When will I know exactly what I will pay in taxes after the property value update?
At the end of 2023 you will be able to find your property on www.mcrealestate.org and see what you will pay in property taxes in 2024.
- Where do my taxes go?
Most of the revenue from property taxes stays local. Your dollars are used to fund the services in your community that you rely on, such as your local police and fire services and your local school district.
The primary beneficiaries of property taxes are schools. About 60% of every tax bill goes to the local school district.
You can look-up your property on our property search website and view the "levy distribution" tab to see where your tax dollars go.