Blog > A NJ Homeowner's Guide to Property Taxes

A NJ Homeowner's Guide to Property Taxes

by Donna Lerner April 08, 2019

Property taxes can be complicated, especially in New Jersey. New Jersey Realtors teamed up with the New Jersey Society of Certified Public Accountants and the Association of Municipal Assessors to create the New Jersey Homeowner’s Guide to Property Taxes. We hope members will distribute the guide to their clients — especially potential first-time buyers — as another layer of service in the transaction. See the full guide at njpropertytaxguide.com.

Assessment

A certified Municipal Assessor, a trained employee appointed by the governing body, establishes the value of the property. The value is based on market data, state laws, rules, court decisions and the state constitution. Residential properties are assessed at their market value and are reassessed for a variety of different reasons including: construction, a successful home value appeal, a town-wide reevaluation or there is a state plan put in place for the reassessment process. As computer technology improves the reassessment process is becoming easier to do and is occurring more frequently.

Budget

Each district is required by law to have a schedule and process
for adopting a budget, and the process usually ends by May. The professional staff in each district are responsible for working with elected officials to work out the annual budget for their district. They determine how much taxes will be raised by subtracting all known revenue from planned spending. The budget then goes through hearings in order to be approved. The final budget is submitted to the County Board of Taxation.

Calculations

Each County Board of Taxation determines the rate of property taxes using the following:

  • Ratables – Using the work done by the municipal assessor, the County Board of Taxtion calculates the total assed value of all taxable property
  • Tax Levy – How much in property taxes is needed for the budget of the taxing district
  • Tax Rate – The tax levy divided by ratables

Billing

Taxes are due in four quarterly installments and the schedule for billing is based on state law. Quarter 1 and 2 amounts are estimates based on the previous half year while quarter 3 and 4 make up the difference between the estimated and final tax amount. Often times, your tax bill will also have budget and tax information enclosed and if you do not receive a tax bill in the mail it means that you do not have to pay.

Payment

In many towns you can pay online or mail a check with your payment coupon. However, if a mortgage company pays your taxes you can disregard the payment coupons. It is vital to keep all information updated and to keep your payment coupons, if received, in a safe place.

Disbursement

Once taxes are paid, they are divided up between counties, municipals, and schools. Generally, your county receives 18 percent, your municipal receives 29 percent and schools receive 53 percent, however these percentages vary depending on where you live.

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Donna Lerner

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