A commercial office building in Nashville, Tennessee has an appraised value of $750,000. The Davidson County tax rate is $3.20 per $100 of assessed value. What is the annual property tax owed on this commercial property?
Correct Answer
A) $9,600
Step 1 — Identify the correct assessment ratio: Commercial property in Tennessee is assessed at 40% of appraised value (not 25% as with residential). Step 2 — Calculate assessed value: $750,000 × 40% = $300,000. Step 3 — Calculate annual tax: ($300,000 ÷ $100) × $3.20 = 3,000 × $3.20 = $9,600. The annual property tax is $9,600.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A transfer tax is a tax imposed on the transfer of ownership of real estate.
Reconciliation is the final step in the appraisal process where the appraiser analyzes the value indications from all applicable approaches and arrives at a single final opinion of value. It is not a simple average of the three values.
The comparable sales approach estimates a property's value by comparing it to similar properties that have recently sold in the same market area. It is the most widely used and reliable approach for appraising residential properties.
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- → Which formula correctly calculates the capitalization rate?
- → External obsolescence in Oklahoma:
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