Owning a home in Missouri comes with many benefits, but it also means understanding your property tax obligations. Whether you’re a first-time buyer or a seasoned homeowner in Columbia, having a solid grasp of property taxes can help you manage your budget effectively. Let’s break down how property taxes work in Missouri and what Columbia homeowners should know.
1. How Property Taxes are Calculated
In Missouri, property taxes are determined by the assessed value of your property and the local tax rate. Here’s a closer look at each component:
- Assessed Value: This is a percentage of your property’s market value, determined by the county assessor. In Missouri, residential properties are assessed at 19% of their market value. For instance, if your home is worth $200,000, the assessed value for tax purposes would be $38,000.
- Tax Rate (Levy): Each county sets a tax rate per $100 of assessed value. This rate can vary depending on where you live, as it funds local services like schools, fire departments, and public infrastructure. Boone County, where Columbia is located, typically has a competitive tax rate, but rates can change based on local budget needs and voted levies.
2. Understanding the Reassessment Process
Missouri law requires counties to reassess property values every two years (in odd-numbered years). This reassessment can lead to fluctuations in your property tax bill, depending on the changes in the housing market. When housing prices rise, your property’s assessed value could increase, potentially raising your tax bill. If you feel the reassessed value of your home is too high, you have the right to appeal it through the Boone County Assessor’s Office.
3. How Property Taxes Are Used Locally
Property taxes in Missouri fund essential public services, and a substantial portion goes to support local school districts. In Columbia, for example, your tax dollars also support the police and fire departments, public libraries, parks, and more. By understanding how your property taxes are allocated, you can see the direct impact on your community and the services you benefit from as a resident.
4. Exemptions and Credits
Missouri offers several programs to help eligible homeowners reduce their property tax burden:
- Homestead Preservation Credit: Seniors and certain disabled individuals may qualify for this credit if they meet income requirements. This credit can help offset property tax increases for eligible homeowners.
- Property Tax Credit for Low-Income Seniors: Also known as the “circuit breaker” credit, this program provides tax relief to qualifying seniors and disabled homeowners who meet income limits.
- Veterans’ Benefits: Some disabled veterans may qualify for additional property tax relief.
If you believe you qualify, it’s worth researching these exemptions further or consulting a local tax professional to ensure you’re taking advantage of every opportunity to save.
5. How to Estimate and Plan for Property Taxes
To get an estimate of your property tax bill, you can multiply your property’s assessed value by the current tax rate in your area. As property values change, it’s wise to budget a little extra each year to account for potential increases. Some homeowners choose to set up an escrow account with their mortgage provider to manage their property tax payments monthly, which can make it easier to handle when tax time comes.
6. Paying Your Property Taxes
In Boone County, property taxes are typically due by December 31st each year. Late payments may incur penalties, so it’s best to plan ahead. The county provides several options for payment, including online payments, mail, and in-person transactions at the Boone County Collector’s Office.
7. What If You’re Buying or Selling a Home?
Property taxes are often prorated during the sale of a home, meaning the buyer and seller each pay a share of the taxes for the time they owned the property during the year. This is typically handled during closing, but understanding how the proration works can help you avoid surprises.
Final Thoughts
Property taxes are a key part of homeownership in Missouri, and staying informed helps you plan your finances more effectively. By understanding the reassessment process, available tax credits, and payment options, you can make the most of your investment in Columbia. For more information, you can visit the Boone County Assessor’s website or consult with a local tax professional to get specific guidance for your property.
Navigating property taxes doesn’t have to be intimidating—understanding the basics will allow you to enjoy the many rewards of homeownership with confidence!