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Property Tax Research

Wondering how your property taxes act your monthly mortgage payment?  Property taxes are assessed on an annual basis and are paid twice a year here in Iowa. This means your property tax amount will be divided into 12 equal sums—one for each month—and these sums are added to an escrow account with your mortgage holder, who then pays the taxes on your behalf when they’re due. In Iowa we pay in arears which can be confusing.  Each City/School Distric has a different tax rate. These rates are applied to your homes assessed value. To help you compare property tax rates across Iowa, the Taxpayers Association of Iowa has compiled the information.

Compare Property Tax Rates across Iowa by clicking:

2020_tax_rate_comparisons.pdf

What are the pros and cons of tax abatements?

Tax abatements can seem like the perfect way to save significant money. But, as with anything else, tax abatement programs have both benefits and drawbacks

Pros:

Save you thousands of dollars in property taxes. Depending on the program, the savings can be significant.

Improves resale while the tax abatement is in place. It’s much easier to sell a house with a tax abatement. Tax abatements can push property values up, helping people afford more house than without the tax break.

Revitalize the area. Areas with tax abatement programs can experience redevelopment and improvement, potentially increasing future property values.

Encourage economic growth. Tax abatements attract more buyers to certain areas. This can result in buyers spending more money and creating more business in that area, which positively impacts economic growth.

Cons:

A significant increase in housing expenses when tax abatement expires. Without planning ahead, this is a major negative. When the tax abatement ends, housing expenses can jump by several hundred dollars each month. Homeowners who take advantage of the tax abatement, affording a more expensive house, could potentially struggle to make the new, higher payment. Budgeting for those future tax payments is a necessity.

Decrease in resale value when tax abatement ends. Your property isn’t as attractive to buyers once the property taxes are reinstated. Sometimes property taxes are inflated after a tax abatement expires, making the cost of owning a home in that area more challenging.

Uncertainty about future property taxes. It’s hard to plan for upcoming property taxes when there is no reliable tax history on a property for several years. This is especially true of the new construction tax abatements.

Tax abatements can be revoked. Many cities can withdraw the tax savings if you're late on past property taxes. 

Property values stay flat or decline. Reminder that tax abatements are incentives for people to build or improve designated areas. This need is usually for good reason. While the hope is the tax abatement will encourage growth and development, and therefore increase property values – this isn’t a guarantee. Sometimes the neighborhoods don’t improve enough to increase property values (though the tax benefit could still offset the cost of the construction).

When discussing PROPERTY TAX, Turbotax states, "If you pay taxes on your personal property and owned real estate, they may be deductible from your federal income tax bill. Most state and local tax authorities calculate property taxes based on the value of the homes located within their areas, and some agencies also tax personal property."  Consult your tax advisor, but home owenership is often a beneifit when it comes time to file your tax return.  

Tax Abatements

Adel - a growing community, great place to live, work & raise a family. See tax abatement information below.

https://adeliowa.org/economic-development/

Altoona - a development friendly community, home of Adventurland amusement park and Prairie Meadows horse racing track and casino. See tax abatement information below.

https://www.altoona-iowa.com/i-want-to/residential-tax-abatement/

Bondurant -  a small, but evolving community where families are drawn to the convenience of location to the metro, a strong school system and a safe community for raising future generations. See tax abatement information below.

https://www.cityofbondurant.com/government/pages/tax-abatement

Carlisle -  a wonderful small town community, that renewed its tax abatement program in 2019. See tax abatement information below.

https://carlisleiowa.org/tag/tax-abatement/

Des Moines - the capital city in Iowa, consistently recognized as one of the best cities in the nation for homebuyers because average housing prices are low, around 20% less than the national average. See tax abatement information below.

https://www.dsm.city/search.php?q=tax+abatement

Norwalk - a southern suburb of Des Moines, where neighbors typically know each other & enjoy quality of life in a low crime community. See tax abatement information below.

https://www.norwalk.iowa.gov/government/departments/community_development/building_a_new_home_in_norwalk

Pleasant Hill - a young and vibrant community with rapid growth. See tax abatement information below.

https://www.pleasanthilliowa.org/289/Tax-Abatement-Information

Van Meter - a lovely growing community west of Des Moines. See tax abatement information below.

https://www.vanmeteria.gov/TaxAbatementProgram.aspx?CNID=3743

~Please reach out to any of our Real Advantage Partners team for questions you might have!