The best magazine
There are tax consequences that must be considered when you make almost any transaction, and this is particularly important when it comes to real estate.
How much do you know about estate taxes? If you've recently acquired real estate of any kind, learning as much as you can about estate taxes is important to make sure you manage your property effectively and legally.
Whether you've purchased land, a house, or other property, or if you've been given or willed property, it's vital to realize that certain responsibilities, such as paying estate taxes, come along with that ownership.
The idea of calculating and paying estate taxes may seem intimidating at first glance, but if you know how, it's easy to make paying taxes on your property easy and stress-free.
There are just two important concepts when it comes to paying estate taxes: paying the right amount, and paying on time.
Get a Property Assessment Getting a property assessment is essential, because the assessment tells you how much your property is worth.
This information is needed to assess the amount of property tax you pay.
Your property's assessed value should be close to the amount you'd receive if you were to sell the property at the time the assessment was made.
The assessed value is based on a variety of factors, including the condition of the property, and the sale price of similar types of real estate.
Pay on Time, Every Time Property taxes are payable every year just like income tax, with one difference.
With property taxes, you can opt to pay in installments with a minimum of fuss (whereas it's a bit more difficult to set up for income tax), so you can pay the taxes due in four installments per year.
This allows you to break up the one large bill into four smaller ones so it's easier to manage the expense.
The other important thing to know about paying real estate taxes is that failing to pay on time can incur penalties and fees.
The further behind you fall with payments, the larger the penalty, so it's particularly important to keep up with those payments.
One final thing to note is that the amount you must pay will change from year to year.
If the value of your property increases, the amount of property tax you owe may increase, too.
This is dependent not only on the current real estate market, but also on local laws that regulate property taxes.
In some states, for example, property tax increases are capped to prevent very large increases occurring in a single year.
This may seem complicated, but you'll get the hang of it quickly.
With a few years' worth of experience under your belt, managing real estate tax gets much easier, and it also becomes easier to predict whether your tax bill will increase or decrease each year.
Source: ...