If you are considering a home purchase in the greater Philadelphia area, there a few things you should know about taxes. As a relocation realtor, I am frequently asked about property taxes on the Main Line as well as in the city. The most common questions are:
Q: Do areas with higher taxes have better schools?
A: While that is the case in many areas, it is not here. The taxes in no way predict the ranking of the school district. On the Main Line and in surrounding suburbs, the taxes have more to do with the percentage of businesses and commercial properties that are generating tax revenue. In areas which are more residential, the taxes tend to be higher. They do not indicate anything about the quality of the school district. See more about this topic here.
Q: Will taxes on the house I’m buying be reassessed at the time of purchase?
A. No, unless the house is new construction, in which case it will be assessed by the county once it transfers ownership for the first time. If you (or the seller) has had work done, like an addition or major renovation that required permits to be pulled, then there can be a reassessment. However, simply changing ownership does not result in a reassessment in our area.
Q: How do I figure out what the taxes are on a property?
A. When you find the assessed value of a property, you multiply it by the local millage rate. This is a number arrived at by the local taxing authorities which figure out how big a budget they require to provide all of the services they offer. Then they take that budget and divide it by the sum total of all of the assessed values in the township (or county or municipality) and the resulting number is the millage rate. In our area, property values are actually only reassessed roughly every 30 years.
Q. When are property taxes paid?
A. School taxes run from July 1 to June 30 of the following year while municipal and county taxes are for the calendar year. The tax bills come out retroactively (the municipal ones often arrive in February as opposed to by January 1) and they offer a discounted rated if paid within a certain time frame.
Q. What is Philadelphia Wage Tax and who has to pay it?
A. Anyone who lives OR works in the city has to pay a wage tax, but it is more if you live and work there. For specifics, click here.
Q. Can I appeal my taxes?
A. You always have the right to appeal your taxes. Requests are only taken at a certain time each year and any changes won’t be reflected until the next tax cycle. In order to appeal your taxes, the burden is on you (or an attorney, if you choose to go that route) to provide the assessor’s office with comparable homes (size, acreage, condition and location must be similar) of similar market value whose taxes are appreciably lower than yours. Sometimes they will be reduced slightly and other times more significantly; they are often not reduced at all.
If you are interested in learning more about the Main Line, please click here to see my Main Line Neighborhood Guide.
If you are relocating to the Philadelphia/Main Line area, please go to my relocation tab. If you’d like to read other blog entries related to relocation, please scroll down a couple of lines and click on RELOCATION (to the right of FILED UNDER). Thanks!