Kansas City MO. Property Tax Rate
Investor · Austin, TX · Member since 2015 · 20 posts · 3 votes
I've been looking at properties in Kansas City lately and I've seen "estimated" property taxes from sellers that vary widely--even for properties with about the same value. Can anyone tell me how property taxes are calculated in KC?
@Christopher Throop taxes are calculated differently based on the county. Jackson County, MO is the biggest county serving the Kansas City area. You can follow this link to see how they calculate your property taxes: http://www.jacksongov.org/content/3310/3324/4257/d...
Basically it comes down to somebody's "opinion" of value. Whenever there is significant property value changes, such as what happened back in 2009-2013, there tends to be a lot of backlash about property taxes (because they city will only reassess the value every few years). There is, however, a procedure for contesting your property tax amount which involves proving (via sold comps) that your house is worth less than what the county says it is. This process has to be done by Aug. to have your taxes reduced by the end of the year.
Now that home prices have been steadily increasing for several years, some of the tax amounts are actually less than they should be. Of course, nobody is going to call their county office and tell them that!
I hope this helps!
@Christopher Throop taxes are calculated differently based on the county. Jackson County, MO is the biggest county serving the Kansas City area. You can follow this link to see how they calculate your property taxes: http://www.jacksongov.org/content/3310/3324/4257/d...
Basically it comes down to somebody's "opinion" of value. Whenever there is significant property value changes, such as what happened back in 2009-2013, there tends to be a lot of backlash about property taxes (because they city will only reassess the value every few years). There is, however, a procedure for contesting your property tax amount which involves proving (via sold comps) that your house is worth less than what the county says it is. This process has to be done by Aug. to have your taxes reduced by the end of the year.
Now that home prices have been steadily increasing for several years, some of the tax amounts are actually less than they should be. Of course, nobody is going to call their county office and tell them that!
I hope this helps!
@Christopher Throop There doesn't seem to be any uniformity so taxes can vary widely. The best thing to do is go on the county tax assessors site and get accurate numbers.
For the state of Missouri:
The assessor determines the market value of the property.
For real property, the market value is determined as of January 1 of the odd numbered years.
Once market value has been determined, the assessor calculates a percentage (for real estate can start at 19% but be no more than 33.3% of its true value in money) of that value to arrive at the assessed value. The percentage is based on the classification, determined by the type of property or how it is used. After the assessed value is calculated, the tax levies are applied.
Here's an example for Kansas City:
Market Value is the amount the Assessor has determined your property is worth on the market.
ASSESSED VALUE
Assessed value is a percentage of the market value as determined by the assessor's office. In order to calculate the assessed value, multiply the market value by the appropriate assessment rate for the type of property.
TAXABLE VALUE
Taxable value is the assessed value less any exempted value.
EXAMPLE OF VALUE CALCULATIONS & TAX DETERMINATION:
| Market Value | X | Classification Rate | = | Assessed Value | - | Exempted Value | = | Taxable Value |
| $110,000 | X | Residential 19% | = | $20,900 | - | $11,400 | = | $9,500 |
| Taxable Value / 100 | = | X | Tax Rate | = | Tax Bill | |
| $9,500 / 100 | = | $95.00 | X | $7.8368 | = | $744.50 |
Tax rates are set each year by local taxing entities within the limits allowed under the constitution and state law.
What I'm really looking for is a ball park number I can apply to the value of a property to get an estimated annual tax amount. I've heard that 1-1.5% would typically work. Is that other people's experience?
@Chris Dawson For analyzing properties I'm just considering the purchase price as the current value of the property. I think county tax values are typically below the market value of a property. I figure if I use market value I should be safe. I hate protesting property values (its a lot of work) but have done it and been successful.
@Alicia Horton Thanks for walking me through the example. $744 is roughly .67% of the value of the property, which seems really small. Are there other taxes to consider as well (e.g., school district)? What would be the total tax I might expect to pay on a rental property?
Are rental properties considered "commercial" or "residential" for tax purposes?
For the state of Missouri:
The assessor determines the market value of the property.
For real property, the market value is determined as of January 1 of the odd numbered years.
Once market value has been determined, the assessor calculates a percentage (for real estate can start at 19% but be no more than 33.3% of its true value in money) of that value to arrive at the assessed value. The percentage is based on the classification, determined by the type of property or how it is used. After the assessed value is calculated, the tax levies are applied.
Here's an example for Kansas City:
Market Value is the amount the Assessor has determined your property is worth on the market.
ASSESSED VALUE
Assessed value is a percentage of the market value as determined by the assessor's office. In order to calculate the assessed value, multiply the market value by the appropriate assessment rate for the type of property.
TAXABLE VALUE
Taxable value is the assessed value less any exempted value.
EXAMPLE OF VALUE CALCULATIONS & TAX DETERMINATION:
| Market Value | X | Classification Rate | = | Assessed Value | - | Exempted Value | = | Taxable Value |
| $110,000 | X | Residential 19% | = | $20,900 | - | $11,400 | = | $9,500 |
| Taxable Value / 100 | = | X | Tax Rate | = | Tax Bill | |
| $9,500 / 100 | = | $95.00 | X | $7.8368 | = | $744.50 |
Tax rates are set each year by local taxing entities within the limits allowed under the constitution and state law.
Hi Alicia or Anyone else in this thread - is the Tax Rate for a particular area contestable? There is one area in 64137 where I own 6 houses. I can't really argue about the market valuation on the houses, but the property tax itself is much higher than houses I own nearby in 64134 and 64130 with similar market values. For example, market value $65,000 but annual tax bill $1400 in Terrace Lake (or St. Catherines) but market value $60,000 annual tax $900 in Fairlane/Robandee and similar $60,000 property is $600 nearby in Grandview. Is there a process for challenging the levy rate on an area?
thanks
Cliff
Hi Christopher and Cliff -
Those are some really great questions that I'm not sure about. I'll have to do some more research on.
In the meantime time you might want to contact the Jackson county Assessment Dept. @ (816) 881-1330, for more information.
I don't think you can argue the levy rate / tax rate - I believe those are set by law. All you can do is argue about the market value, which then would raise or lower everything else. You would need to talk to the Jackson County Assessor about the market value.
I suspect some of the variation you are seeing is due to the school district. 64137 should probably be Hickman Mills schools. 64134 might be Hickman Mills or Lee's Summit, depending on where exactly the house is. 64130 is going to be KCMO schools.
There should be a breakdown on your tax bill of where it's all going. For my residence in Blue Springs, about 60% of the total tax bill goes to the school district. The fire department gets 13%, the city gets 8%, the county gets 5.6%, and then there are several other smaller pieces of the pie. That 60% going to the schools is why I think the school district can affect your bill a lot.
If you don't have the paper tax bill, you can look up your property at http://www.jacksongov.org/ascend . Punch in the account number (if you know it) or look it up by address; you should then be able to pull up an online copy of the current tax bill. This will have the breakdown for schools, city, county, etc on it. When I do that for my house, the website gives me an identical set of numbers to the paper tax bill that I got in the mail.
You should also get a statement from Jackson County in about the middle of the year that tells you what your property tax bill is *probably* going to be. It is not a bill; it is just for your information. It has the same breakdown for schools, city, county, etc that the actual bill does. I believe the idea of this is to incorporate any market value changes and tax rate changes that have happened since the first of the year, to give you a "heads-up" about what's coming at the end of the year.
@Christopher Throop were classified as commercial instead of residential the real estate taxes would be $2,758.55 instead of $744.50!
Yes, classification matters. And, no the tax rate can't be contested, but in most states the assessed value, classification and uniformity of assessment (comparison with like properties even if the value is correct) can be challenged.