6.3

Terms to Know:• Property Tax• Assessed Value• Decimal Tax Rate

Decimal Tax Rate formula=Amount to be Raised by Property tax Total Assessed Value

Paynesville School District budgeted expenses of $6,000,000. Estimated income of $1,800,000. Total assessed value last year was $39,000,000.

Find the tax rate needed to meet expenses, correct to five decimal places.

1. Expenses – Estimated income = Property tax needed

$6,000,000 - $1,800,000 = $4,200,000.

2. Solve the Decimal Tax Rate formula…

$4,200,000 / 39,000,000 = 0.107692 = 0.10769 (Tax rate)

What is the decimal tax rate (3 decimal places)?

1.Expenses – Estimated income = Property tax needed

$6,750,000 - $650,000 = $6,100,000.

2.Solve the Decimal Tax Rate formula…$6,100,000 / 80,000,000 = 0.0762 =

0.076 (Tax rate)

What is the decimal tax rate (4 decimal places)?

1.Expenses – Estimated income = Property tax needed

=$1,950,000.

2.Solve the Decimal Tax Rate formula…$1,950,000 / 48,200,000 = 0.04045 =

0.0405 (Tax rate)

Calculate the property tax due on Watson’s $60,000 property if his tax rate is $6.20 per $100.

1.Divide assessed value by 100$60,000/100 = 600 (# of $100 units)

2.Tax rate x # of $100 units = property tax due

$6.20 x 600 = $3,720

Calculate the property tax due on $42,000 property if his tax rate is $3.736 per $100.

1.Divide assessed value by 100$42,000/100 = 420 (# of $100 units)

2.Tax rate x # of $100 units = property tax due

$3.736 x 420 = $1,569.12

Calculate the property tax due on $120,000 property if his tax rate is $4.128 per $100.

1.Divide assessed value by 100$120,000/100 = 1,200 (# of $100

units)2.Tax rate x # of $100 units = property

tax due$4.128 x 1,200 = $4,953.60

Calculate the property tax due on Watson’s $60,000 property if his tax rate is $62 per $1,000.

1.Divide assessed value by 1,000$60,000/1,000 = 60 (# of $1,000

units)2.Tax rate x # of $1,000 units =

property tax due$62 x 60 = $3,720

Calculate the property tax due on $67,500 property if his tax rate is $50.08 per $1,000.

1.Divide assessed value by 1,000$67,500/1,000 = 67.5 (# of $1,000

units)2.Tax rate x # of $1,000 units =

property tax due$50.08 x 67.5 = $3,380.40

Calculate the property tax due on $13,500 property if his tax rate is $25.83 per $1,000.

1.Divide assessed value by 1,000$13,500/1,000 = 13.5 (# of $1,000

units)2.Tax rate x # of $1,000 units =

property tax due$25.83 x 13.5 = $348.71

Calculate the property tax due on Watson’s $60,000 property if his tax rate is stated as 62 mills or 6.2 cents per $ of assessed value.

Mills / 1,000 = Mills rate in $• 62/1,000 = $0.062

Cents / 100 = Cents rate in $• 6.2/100 = $0.062

Property assessed amount x rate in $ = total tax amount• $60,000 x $0.062 = $3,720

Calculate the property tax due on $38,400 property if his tax rate is stated as 52 mills per $ of assessed value.

Mills / 1,000 = Mills rate in $• 52/1,000 = $0.052

Property assessed amount x rate in $ = total tax amount• $38,400 x $0.052 = $1,996.80

Calculate the property tax due on $32,100 property if his tax rate is stated as 3.8 cents per $ of assessed value.

Cents / 100 = Cents rate in $• 3.8/100 = $0.038

Property assessed amount x rate in $ = total tax amount• $32,100 x $0.038 = $1,219.80