Millage rate & other important tax terms to know
Millage rates are just one of the many specialized tax terms property owners are likely to encounter. While it's often used interchangeably to mean "tax rate," millage rates have some key differences. Here is a guide to understanding millage rates and a few other important pieces of property tax terminology:
Millage rates
Millage rate has nothing to do with mills or milling. Rather, the name comes from the Latin "millesimum," which means "one thousandth" (1/1000). Millage rate or mill rate means the amount per every $1,000 of a property's value. Multiple millage rates go into calculating property tax amounts.
Liens
A lien is a legal claim against your property. Liens are established when you neglect to pay your taxes. Tax liens can be applied to land and building property but also to other assets like motor vehicles.
Levies
A tax levy is a more significant penalty for neglecting your taxes in which the government can actually take ownership of your property to pay the debt. The IRS can seize and even sell your assets if they're levied. Fortunately, levies are not applied immediately, but can happen after a tax lien has been placed on property and not removed.
Ad valorem
Ad valorem is another tax term based on Latin roots. It means "according to value" and is used to convey the flexible value of individual properties and assets. Ad valorem is a percentage of the sale price or the assessed value of the asset.
These are just a few of the important tax terms property owners should know. Keep these in mind to better understand your own property taxes and better navigate the financial world.
About the Author
Cheryl Pendenza - Realtor®/Broker Associate
Bringing more than 30 years of experience to the table, Cheryl has a paralegal degree, banking background, and is a member of many professional, civic, and community organizations.
Qualified • Experienced • Skilled
"As a full-time REALTOR®, I am dedicated to providing my clients with a high level of service by building relationships, marketing, and negotiating on their behalf. As a homeowner, I realize how important homeownership is.
Cheryl brings warmth and compassion to her client relationships and referrals have become the backbone of her business. "I’m grateful for every referral and welcome the opportunity to help clients achieve their real estate goals.”
Cheryl Pendenza, Broker Associate affiliated with RE/MAX Andrew Realty Services since 1999 is a local businesswoman and formidable negotiator who can help you achieve your real estate goals. Supporting family, community and local business is important to Cheryl and she can often be found at one of the local restaurants, shops, or galleries.
