Assessed Property Value ($)

Total Tax Budget ($)

function calculateMillageRate() { var assessedValue = parseFloat(document.getElementById("assessedValue").value); var taxBudget = parseFloat(document.getElementById("taxBudget").value); var resultDiv = document.getElementById("result"); if (isNaN(assessedValue) || isNaN(taxBudget) || assessedValue <= 0 || taxBudget < 0) { resultDiv.innerHTML = "Please enter valid positive numbers for assessed value and a non-negative number for tax budget."; return; } // The millage rate is calculated as (Total Tax Budget / Assessed Property Value) * 1000 // This gives the rate per $1,000 of assessed value. var millageRate = (taxBudget / assessedValue) * 1000; resultDiv.innerHTML = "

Millage Rate Calculation Result

" + "Assessed Property Value: $" + assessedValue.toLocaleString() + "" + "Total Tax Budget: $" + taxBudget.toLocaleString() + "" + "Calculated Millage Rate: " + millageRate.toFixed(2) + " mills"; }

Understanding Millage Rate Calculations

The millage rate is a crucial component in property taxation. It represents the rate at which property is taxed, expressed in "mills." A mill is equivalent to one-thousandth of a dollar, or $0.001. In simpler terms, for every $1,000 of assessed property value, you pay a tax amount equivalent to the millage rate number.

How Millage Rates Work

Local governments, such as counties, cities, and school districts, levy property taxes to fund public services like schools, roads, police, and fire departments. The total amount of money these entities need to raise from property taxes is their "tax budget."

This tax budget is then divided by the total assessed value of all taxable property within the jurisdiction. This forms the basis for determining the millage rate.

The Calculation

The formula for calculating the millage rate is straightforward:

Millage Rate = (Total Tax Budget / Assessed Property Value) * 1000

The multiplication by 1000 is what converts the rate into "mills." If the calculation results in a rate of 15, it means that for every $1,000 of assessed property value, the owner will pay $15 in property tax for that specific taxing entity.

Example:

Let's say a local school district needs to raise $5,000,000 to fund its operations (its tax budget). The total assessed value of all taxable properties within the district is $500,000,000.

Total Tax Budget = $5,000,000
Assessed Property Value = $500,000,000

Using the formula:

Millage Rate = ($5,000,000 / $500,000,000) * 1000

Millage Rate = 0.01 * 1000

Millage Rate = 10 mills

This means that homeowners within this school district will pay 10 mills on their property taxes, or $10 for every $1,000 of their property's assessed value.

Why is this important?

Understanding the millage rate allows property owners to better estimate their annual property tax liability. It also highlights how local government budgets and property values directly influence the tax burden on residents. When tax budgets increase or the total assessed property value decreases, the millage rate typically goes up, leading to higher property taxes.