A home in Pulaski County, Arkansas has a true market value of $180,000. The total millage rate for the property is 50 mills. What is the annual property tax owed on this property?
Correct Answer
B) $1,800
Arkansas assesses real property at 20% of true market value. The assessed value is $180,000 x 20% = $36,000. A 50-mill rate equals 50 / 1,000 = 0.05. The annual tax is $36,000 x 0.05 = $1,800, so choice B is correct.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The cost approach estimates a property's value by calculating the current cost to rebuild the improvements, subtracting accumulated depreciation, and adding the land value. It is most reliable for new construction and special-purpose properties.
Depreciation is an accounting method of allocating the cost of an asset over its useful life, allowing investors to deduct a portion of the asset's cost each year.
Highest and best use is an appraisal concept that identifies the most profitable, legally permitted, physically possible, and financially feasible use of a property. It is the foundation of all property valuation.
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Previous Question
A county assessor in Arkansas appraises a residential property at a true market value of $250,000. Which of the following correctly states the assessed value of this property for property tax purposes?
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Sandra owns a home in Little Rock, Arkansas that sits on a lot measuring exactly one-quarter acre. She has claimed the Arkansas homestead exemption on the property. A creditor has obtained a judgment against Sandra and seeks to force a sale of her home to satisfy the debt. Which of the following statements most accurately describes the effect of the homestead exemption in this situation?