A residential home in Springfield, Missouri has a true market value of $300,000. The local tax rate (levy) is $8.00 per $100 of assessed value. Using Missouri's residential assessment ratio, what is the owner's annual property tax bill?
Correct Answer
A) $4,560
Step 1 — Calculate assessed value: Missouri assesses residential property at 19% of true value. $300,000 × 19% = $57,000 assessed value. Step 2 — Calculate tax: The levy is $8.00 per $100 of assessed value. $57,000 ÷ $100 = 570 units. 570 × $8.00 = $4,560 annual property tax.
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Related Topics & Key Terms
Key Terms:
Related Concepts
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.
Homestead portability allows homeowners to transfer a portion of their accumulated homestead tax savings to a new homestead in the same state.
The income approach estimates a property's value based on the income it generates by converting net operating income into a value estimate using a capitalization rate. It is the preferred method for income-producing properties.
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