Property taxes are a significant ongoing cost of homeownership in Pennsylvania. Understanding how they're calculated and their relationship to property value helps homeowners budget effectively and identify potential assessment issues.
How Property Taxes Work
Pennsylvania property taxes are based on the assessed value of your property multiplied by the local millage rate (tax rate).
Basic Formula:
Annual Property Tax = Assessed Value × Millage Rate
Example: A property assessed at $200,000 with a 25 mill rate pays $5,000 annually (200,000 × 0.025)
Key Terms
- Assessed Value: The value assigned by the local tax assessor, which may differ from market value
- Millage Rate: Tax rate expressed as dollars per $1,000 of assessed value
- Market Value: The actual selling price a property would command in the current market
Pennsylvania Tax Rates
Pennsylvania has some of the highest property tax rates in the nation, averaging 1.5% of home value annually, though rates vary significantly by county and municipality.
Assessment vs. Market Value
Assessed values don't always equal market value. Many Pennsylvania properties have assessed values based on outdated assessments, sometimes decades old, creating disparities between similar properties.
Tax Appeals
If you believe your assessment is too high relative to your property's market value, you can appeal. Fast, credible appraisals provide the objective evidence needed to support successful tax appeals and potentially save thousands in annual property taxes.