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
Deborah Tomczak
Hello, my name is Deborah Tomczak, One of the Top Selling Real Estate Agents on the Space Coast working with Remax/Elite.
I specialize in the business of pairing discerning buyers with homes that match their wants and needs, and maximizing profits for people with real estate to sell. My commitment to you is that I will make sure you are communicated with during the entire process to reduce stress and ensure a positive outcome.
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