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Explaining the MIL Rate
How It Affects Your Taxes
A MIL (tax) Rate is the method used to
determine the taxes that are to be paid on a property here
on Martha's Vineyard. That tax rate when multiplied by your
property value (assessed value determined by the tax assessor)
equals your tax bill.
For example: a residential property that has been assessed
at $850,000.00 in 2009 is taxed at a residential mil rate
of 351 mils. To determine the amount of property tax that
is paid on that house, you multiply the assessed value by
the mil rate. $850,000 x 0.00351% = $2,983.50.
Just because the mil rate increases, this does not necessarily
mean the tax paid will go up in direct proportion. The assessed
value is a separate calculation each town makes based upon
many factors that will determine what the final tax paid will
be. What is assessed value? Assessed value
is the price placed on land and buildings by a government
tax assessor for use in levying property taxes. The assessed
value of the property may be different from the appraised
value. Appraised value or market value is rarely the same
as assessed value. It is common that when assessed values
go up radically, the mil rate is adjusted downward so that
the impact on the taxpayer is not extreme.
The assessing authorities use a fractional formula to determine
what percentage of market value your house is worth. Usually
they call this figure the sales ratio. This can be called,
depending on the jurisdiction, the average ratio, assessment
level, director's ratio, the common level of 100% of true
value, RAR (residential assessment ratio) or the equalization
rate (which may not always be equivalent to the sales ratio).
For Martha's Vineyard real estate, the sales ratio is 100%
so if a house sells for a market value of $850,000 it would
be assessed at $850,000.
Here is the residential mil rate history for six consecutive
years in all six Martha's Vineyard Island towns: Aquinnah
(Gay Head), Chilmark, Edgartown, Oak Bluffs, Tisbury (Vineyard
Haven), and West Tisbury.
| TOWN |
2010 |
2009 |
2008 |
2007 |
2006 |
2005 |
| Aquinnah |
3.79 |
3.49 |
3.25 |
4.03 |
3.69 |
3.58 |
| Chilmark |
2.03 |
1.98 |
1.96 |
1.87 |
1.85 |
1.96 |
| Edgartown |
3.09 |
2.91 |
2.73 |
2.94 |
3.03 |
3.05 |
| Oak Bluffs |
6.30 |
6.04 |
5.63 |
5.59
|
5.75
|
6.07 |
Tisbury
|
6.57* |
5.98** |
5.49 |
5.63 |
5.20 |
5.86 |
| West Tisbury |
4.46 |
4.28 |
4.10 |
4.38 |
4.77 |
4.52 |
| Tisbury
2010 Commercial = 8.27* Tisbury 2009 Commercial = 8.23** |
You may be asking, why is my home tax assessment different
from the price I could sell my house for? One reason is
that the Assessor’s make their property valuations
anywhere from 12-months to 18-months before the assessments
are published, so numbers are not necessarily representative
of current market conditions. Your
true home value is the 'market value'. The definition for
market value is the most probable price that a property
will sell for in a free market of buyers and sellers, free
from constraining pressures or unusual situations. That
value is found by hiring a licensed appraiser and obtaining
a current home appraisal. On Martha's Vineyard you will
find there is usually a condiderable difference between
the assessed value and the current market value.
Another question I am asked by buyers is,"After I buy
my home, will my taxes go up immediately?" The answer
is no, not necessarily. The assessment and tax will remain
status quo until the next valuation period and then you
will be assessed at 100% of the current property value.
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