Property tax laws in the United States vary from state to state. Indeed there are two separate sets of laws- federal and state laws, that together regulate how taxes, possession, and succession of the properties are to be handled.
In this article, we'll be discussing property tax laws for the state of New Jersey, only.
Regardless of whether you own a commercial or residential property, these laws certainly concern you.
So, keep reading to know more.
How Tax Is Calculated?
Property tax in New Jersey depends on the value of the property. For this reason, it is also referred to as an "ad valorem tax."
Typically, the value of the tax to be paid is decided based on 6 factors:
- market value of the property
- cost of municipality programs
- cost of public schools
- other revenue sources for the state government
- tax-exempt laws
- total number of taxable properties in a region
In the state of New Jersey, it is noteworthy that there are no homestead laws in place. These laws are in place to protect a homeowner from becoming homeless, in times of reversal of financial status. Perhaps, experienced property lawyers could then help in such situations to file for homestead exemptions under the federal laws. Nonetheless, there are several other exemptions for property taxes in the state of New Jersey, as well. For example, real properties that are used for horticulture or agriculture purposes are exempted from the usual taxation procedure.
The Latest Updates
In light of the pandemic induced economic recession, a report suggests, nearly half of the property owners failed to pay taxes. For this reason, the state government had to introduce grace and exemptions for the taxpayers.
In April 2020, according to a report published in CNBC, Gov. Phil Murphy allowed municipalities to delay the payment deadline. Later, in December 2020, the deadline for the Senior Freeze Property Tax Reimbursement application was extended again. On 9th February 2021, the loaning laws and associated taxes were also amended.
All these amendments are being made to ensure that no homeowner is left homeless during these difficult times. That being said, it is still advised to gather more information about the laws you are concerned about. And likewise, consult with a property attorney to understand the laws better.
How to Save Taxes?
The state and federal regulations for the evaluation of property taxes are quite rigid. However, the tax calculations are still subject to the assessor's perspective. In other words, if your property appeals more to the assessor, the chances are you'll receive a higher tax. This is because appealing properties are assumed to have more market value.
Besides, if you construct more structures on your property, you are also more likely to receive higher tax bills. In most cases, the renovations and remodeling done to a property appreciate the value in the market. And as already mentioned, the property taxes in New Jersey are decided on the basis of their value. In short, the more your property's value, the more you'll be paying in taxes.
The Outlook
Property tax laws in the state of New Jersey are not as complicated. With the right knowledge and carefully considering your steps, you can not only save taxes but also protect your property against penalties.
