Many Georgia residents often travel during the summer months, and some choose to rent out their homes while they are away. While renting a residence temporarily can provide an additional and welcome revenue stream, failing to properly record and disclose this source of income can have serious tax implications. Tax must be paid on rental income even if the property being rented out was used as a taxpayer's primary residence for most of the year, but declaring this income also makes certain expenses tax deductible.
Making the leap from renter to homeowner is often an important milestone for many people, giving them a sense of "grown-up" satisfaction, or maybe signifying that they have finally staked out their piece of the American Dream. But how do you avoid unnecessary taxation when you are ready to sell your first home?
Many Georgia homeowners understand the burden of steep property taxes. However, there may be ways to get those taxes lowered without attending the local town hall meetings and protesting the tax rate. One approach that could result in a property tax reduction is to appeal the assessment. An assessment is an estimate of the property's value, which is determined on an annual basis by the local tax assessor. It involves factors such as comparing the property's value with the worth of like properties in the vicinity. Then, once the property's assessed valuation has been determined, it is multiplied by the local property tax rate.
There may be homeowners or investors living in Georgia who can benefit from understanding more about which states have the highest property taxes. The Tax Foundation recently analyzed property taxes rates across the country, and helped provide some perspective on the differences from state to state. The effective property tax rate of 2.38 percent in New Jersey is the highest in the country. The 2.32 percent rate in Illinois and the 2.15 percent rate in New Hampshire are the other highest property tax rates in the country.
Many Georgia resident might find it difficult to deal with their taxes. In an apparent attempt to protest the required payments, two Pennsylvania residents took steps to demonstrate their displeasure with the system. The most recent case involved a Montgomery County resident who waited until the last moment to pay his property taxes. That person showed up with a wheelbarrow containing the $831 he owed in dollar bills and coins, including over 50,000 pennies.
Georgia residents who own property in Douglas County were sent their property appraisal notices on June 1. The notices informed 53,000 Douglas County property owners about the 2015 value of their property that was calculated for county taxation reasons. Property values increased for 66 percent and decreased for 23 percent of Douglas County property owners. Eleven percent of the property owners saw no change in the value of their properties.
The state and local taxes Georgia residents pay on their properties and assets vary widely. In addition to the existence of multiple laws and statutes, there are also variances in methods of collection, property valuation and tax calculation to consider. All these factors can affect an individual's tax debt.
At a public meeting on July 14, some residents of Gwinnett County urged commissioners to not raise their property taxes when the issue comes to a vote on July 22. Statistics indicate that a homeowner who has a house worth $167,000 will pay $785 in county property taxes. If millage rates are merely left alone, they could go up to an average of $850.