The value of a property as shown on the current tax roll is its:
Correct Answer
B) Assessed value
Assessed value is the value of property on the current tax roll, or the value on the roll for a particular tax year. It may differ from market value, and book value is an accounting figure from financial statements.
Why This Is the Correct Answer
Option B is correct because assessed value is the value of property on the current tax roll, or the value that was on the assessment roll for a particular tax year. It is set for property tax purposes. It may differ from market value.
Why the Other Options Are Wrong
Option A: Market value
Option A is wrong because market value is the most probable price in a competitive, open market, which may differ from the figure shown on the tax roll.
Option C: Insurable value
Option C is wrong because insurable value relates to the portion of a property covered by insurance, not the value shown on the tax roll.
Option D: Book value
Option D is wrong because book value is an accounting figure from financial statements, typically based on cost less depreciation, not the tax roll value.
Assessor sets assessed value
The assessor puts assessed value on the tax roll; the market sets market value.
How to use: Use this when a question asks which value appears on the tax roll.
Exam Tip
Match each type of value to its purpose: tax roll for assessed, insurance for insurable, accounting for book.
Common Mistakes to Avoid
- -Assuming assessed value equals market value
- -Confusing book value with assessed value
- -Using insurable value as a tax figure
Concept Deep Dive
Analysis
This question tests a basic value definition. Assessed value is the value of property on the current tax roll, or the value on the roll for a particular tax year. Candidates must distinguish it from market, insurable and book value.
Background Knowledge
Different purposes call for different types of value. Assessed value is used for property taxation and may be tied to market value in different ways depending on local law. Appraisers should not assume the assessed value equals market value.
Real-World Application
A homeowner tells an appraiser the house must be worth its tax bill figure. The appraiser explains that the assessed value on the tax roll serves tax purposes and that her market value opinion is based on recent comparable sales.
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