Taxes can be unpleasant and hassling but we have to fact that it is essential because this is how our government pays for different public services and programs. A lot of people are already familiar with how the federal and state income tax works. However, not all of us know about real estate property taxes.
During early Europe, property taxes were basically just based on the size of the land that a person owns. So from that alone, we can conclude that the bigger the land was the higher real estate property the owner has to pay for.
After many years, this became not the only type of consideration. The value of land started to be seen and if a certain piece of land can output goods and services, then the higher the value of the property itself. This is because being able to produce products as well as services provides the owner with a profit. Aside from that, tax assessors also started examining other properties such as the structure build on it, livestock available and the farming equipments that can be found on the land itself. This happened because the people then realized that if a piece of land can produce a lot of profit for a certain owner then that owner can definitely afford to pay a bigger amount of tax. Hence, these factors were put into consideration.
During that time, the colonies of the United States were levied a ‘general property tax’ by the local government. That means that the colonists paid the same amount of tax on all properties regardless if its real estate or personal. They did not place any importance on the factors mentioned above.
However, this transformed over time. This is because the property taxes in the United States nowadays are all based on real estate properties. It is very rare for you to find a state that would tax personal property items. Due to this, office buildings are taxed basing on the rental income that the owner gets out of it.
Real estate properties are basically the land and all the permanent structures that are on the land itself while personal properties are those properties which are not rooted on the land like farm equipments, wagons and so on.
Add Comment