Tennessee Housing Taxes: What You Need to Know

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By Rochford Law Posted on September 8, 2021 at 1:22 PM

When it comes to your property, whether you’ve recently purchased or are looking to purchase real estate, understanding your housing taxes will be important. It can sometimes be challenging to learn all about Tennessee taxes, the requisite paperwork, property inspections, etc.

Having a real estate attorney assist you with the tax processes associated with your property can ensure that everything goes smoothly. A residential property is a significant investment and understanding state taxes is crucial before you buy or sell the property. Having the right legal representation can make the process easier and more successful.

Here’s what you need to understand about Tennessee property taxes:

1. What are Housing/Property Taxes?
2. National vs Tennessee Tax Rates
3. Calculating Your Taxes
4. Tennessee Real Estate Taxes
5. Hire a Professional Tennessee Real Estate Attorney

What are Housing/Property Taxes?

Owning a home entails paying property tax. Essentially, a tax is based on the value of your house, and the money is used to fund municipal services, such as schools and police departments in your residential or commercial area.

Generally, Tennessee homeowners get the best property taxes in the country, however, rates will vary by county and state. When you enlist the help of a professional real estate attorney, you can ensure that you understand your county’s specific and that your property taxes are handled with care.

National vs Tennessee Tax Rates

Did you know that Tennessee property taxes were ranked as the 12th lowest of all 50 states?

Tennessee homeowners generally pay an average of 0.75 percent of their homes' value. With the statewide average for home values being around $146,000, this works out to be about $1,095 per taxable property, depending on your area.

Whereas, in general the United States average is reported to be about $2,471. As Tennessee property taxes fall under about half as much as the rest of the U.S., enlisting the help of a real estate attorney will ensure you get the best deal for your property circumstances.

Get a free consultation with Rochford Real Estate Law Title to work with a real estate attorney today.

Calculating Your Taxes 

A Tennessee homeowner's property tax rate depends on the following three factors:

• The appraisal values
• The assessment ratio
• Your specific county

A property tax rate is set by the county's tax commission. Commissions determine a tax rate based on the overall value of property in the county as well as the extent of services provided. By using these numbers, you can determine your Tennessee personal property tax.

First, multiply the current appraised value of your residential or farmland property by 25 percent. The result of this first step will be known as the assessed value. Then, multiply that number by your county's tax rate.

Counties with single tax rates or those with varied tax rates in each municipality and district will affect how much your estimated property taxes will be. A local, professional real estate attorney can help you determine the tax rate in your county and ensure you’re following the proper regulations for your property.

Pro Tip: Many Tennessee counties, including Davidson and Shelby, offer detailed information about taxation methods on their property assessors' websites.

Get a free consultation with Rochford Real Estate Law Title to work with a real estate attorney today.

Tennessee Real Estate Taxes

Outside of Shelby County, residents in other Tennessee counties will pay below the national average in property taxes. Additionally, you're paying less than you would in other nearby states with the same home value.

Georgia and Missouri, both of which have comparable median home prices, have effective property tax rates that are 1 percent and 0.93 percent higher than Tennessee. It is often considered a blessing to be taxed at a lower rate than your neighbors, but it can also be considered a curse. Be sure to work closely with your real estate attorney to ensure you are making the best decisions for you and your property.

Hire a Professional Tennessee Real Estate Attorney

Are you in need of assistance understanding the taxes associated with your real estate property sale or purchase? Hiring an experienced real estate attorney like Rochford Law & Real Estate Title in Nashville, TN can save you time and money in the long run.

It’s best to cover all your bases and get through a real estate transaction with as little problems as possible. However, it’s comforting to know that should a dispute pop up, a real estate attorney can help find a resolution.

Contact Rochford Law & Real Estate Title today! 

Topics: Nashville Real Estate, Real Estate Attorney