When calculating property taxes, what is considered a mill?

When calculating property taxes, what is considered a mill?

• A. 1/100 of a dollar
• B. 1/1,000 of a dollar
• C. 1/10 of a dollar
• D. 1/5 of a dollar

Answer: (B)

A mill is defined as one-thousandth of a dollar, which means that one mill equates to $0.001. In the context of property taxes, this measurement is utilized to determine the tax rate applicable per thousand dollars of assessed property value. For example, if a property has an assessed value of $100,000 and the property tax rate is 20 mills, the tax would be calculated as follows: 20 mills = $20 per $1,000 of property value. Therefore, the tax owed would be (100,000 / 1,000) * 20 = $2,000. Understanding what a mill represents is crucial for interpreting property tax bills, as it directly influences the amount a property owner is required to pay based on the valuation of their property. This knowledge allows real estate professionals to accurately inform clients about potential tax liabilities related to their properties.

A mill is defined as one-thousandth of a dollar, which means that one mill equates to $0.001. In the context of property taxes, this measurement is utilized to determine the tax rate applicable per thousand dollars of assessed property value. For example, if a property has an assessed value of $100,000 and the property tax rate is 20 mills, the tax would be calculated as follows:

20 mills = $20 per $1,000 of property value. Therefore, the tax owed would be (100,000 / 1,000) * 20 = $2,000.

Understanding what a mill represents is crucial for interpreting property tax bills, as it directly influences the amount a property owner is required to pay based on the valuation of their property. This knowledge allows real estate professionals to accurately inform clients about potential tax liabilities related to their properties.