Chapter 3 - Property Taxes Flashcards
(24 cards)
Ad Valorem—
A Latin phrase meaning “according to value”; used to refer to taxes assessed on the value of real property (real estate, such as land and buildings) or personal property (such as vehicles and boats).
Appraisal
A professional estimate or opinion of the value of a piece of property (parcel of land), as of a certain date, that’s supported by objective data.
Assessed Value
The value placed on a property by a taxing authority for the purpose of taxation. With real estate, this value may be a fraction of true value.
Assessment
The valuation of real property that is used as a basis for calculating the amount of real estate tax to be levied. Also, the levy or rate to be paid to the government for services provided or constructed by it (e.g., curbs, sewers, sidewalks); sometimes referred to as a “special assessment.”
First in Time, First in Right
A concept that refers to the prioritization of liens based on the timing of the lien attached to the property.
Junior Lien
A lien with a lower priority, which is paid after those with a higher priority.
Levy
To collect, impose, or tax; in some situations, such as those related to collections, it means to seize.
Lien
A non-possessory interest in real property, giving a lienholder the right to foreclose if the owner does not pay a debt owed the lienholder. Also called: Financial Encumbrance.
Market Value
The theoretical price that a piece of property would bring if placed on the open market for a reasonable time, with a buyer willing (but not forced) to buy, and a seller willing (but not forced) to sell, if both buyer and seller were fully informed as to possible use of the land. Also called: Fair Market Value or True Value
Mill—
An amount equal to one-tenth of one cent or $1 per $1,000, used in expressing tax rates.
Senior Lien
A lien with higher priority, which is paid before those with a lower priority. Also called: Superior Lien
Special Assessment
A tax levied only against properties that benefit from a public improvement (e.g., a sewer or streetlight) to cover the cost of the improvement; creates a special assessment lien (an involuntary lien).
Tax Assessor
A local government official who has either been elected or appointed to estimate the value of real property within the boundaries of a specific municipal entity that has the authority to tax real property.
Tax Lien—
A lien on real property to secure the payment of taxes.
Tax Rate
A rate used to calculate the property taxes based on the assessed value of a property.
Tax Ratio
A percentage of the market value of a property used to calculate ad valorem property taxes. The tax ratio typically ranges between 10% and 100%, depending on the jurisdiction.
Assessed Value
The value placed on a property by a taxing authority for the purpose of taxation. With real estate, this value may be a fraction of true value.
Homestead Exclusion
In North Carolina, a partial exclusion of the assessed value of an owner-occupied property for qualified residents.
Horizontal Adjustment
A process through which a North Carolina taxing unit applies a uniform adjustment to the current value of all properties in a targeted area or of specific types of properties.
Lien
A non-possessory interest in real property, giving a lienholder the right to foreclose if the owner does not pay a debt owed the lienholder. Also called: Financial Encumbrance.
Machinery Act
A North Carolina law providing for the listing, assessing, and appraisal of property (real estate and personal property, including motor vehicles).
Octennial Reappraisal
Property assessment performed every eight (8) years, such as in North Carolina.
Special Assessment
A tax levied only against properties that benefit from a public improvement (e.g., a sewer or streetlight) to cover the cost of the improvement; creates a special assessment lien (an involuntary lien).
Special Assessment District
An area or neighborhood that benefits from an improvement and is therefore taxed.
