You will usually only have to pay property taxes if you become a homeowner or if you purchase some type of investment real estate.
In general, property taxes are paid in two assessments: one for the school district in which the real estate you own is situated and one for the county and city or town in which the property you own is located. In some cases, depending on the property’s location, you may pay a small additional assessment to a village, water district or other locality.
Property taxes are usually computed by applying a fixed rate of tax to the value of the property being assessed. The taxable assessed value is usually the purchase price of the property. It may be increased if you make major improvements to your property and the property may be reassessed from time to time to reflect increases or decreases in property values in general.
Certain exemptions may offset a portion of the assessed value of your property, which could decrease your tax bill.
Examples of these exemptions are the
STAR exemption, which provides school tax relief for certain residential properties, and the Enhanced STAR program, which provides greater relief to senior citizens. Other exemptions exist for veterans of the US military service, farmers, disabled persons with limited income and many other targeted groups. However, you must apply for a property tax exemption to receive one. They are not automatic and generally cannot be claimed retroactively.
School taxes are usually assessed at the end of August and payable by September 30 of each year. County and city or town taxes are usually assessed in January and payable by March 31 of each year.
You may pay your property taxes and homeowners insurance in equal monthly installments with your mortgage payments. Your lender will, usually without charge, deposit the extra payments into an escrow account and then pay the tax installments and other expenses as they become due.