Everyone who owns property pays taxes. Benjamin Franklin said that the only things certain in this life are death and taxes. How much do we pay in taxes, what are the taxes used for and how is the tax bill calculated?According to the website Tax-Rates.org ñ- The 2021 Tax Source, the median personal property tax in El Paso County is $1,017 per year for a house with the median value of $216,800. On average, El Paso County collects 0.47% of a property’s fair market value as property tax. El Paso County residents pay, on average, 1.42% of their yearly income in property taxes. While the exact property tax a person will pay is set by the assessor on a property-by-property basis, the website has a tool to estimate a person’s yearly property tax.Tax-Rates.org states that El Paso County property tax is used locally to fund school districts, public transport, infrastructure, fire protection districts and other municipal government projects. Property tax in Colorado is almost always used for local projects and services and does not go to state or federal projects.There are several steps in calculating personal property taxes. First there is the tax rate. The tax rate is set in mills. One mill equals $1 for every $1,000 of assessed value. The mill rate is multiplied by the assessed value of the property, which results in the amount of money owed in taxes. The assessed value of a property is a percentage of the market value, which is the price that a particular property could be sold for. As market values increase, if the assessed value is not decreased, the amount of taxes collected on a particular property increases because the assessed value will increase accordingly with the market value.There are at least two other factors that affect personal property taxes in Colorado, the Gallagher Amendment and the Taxpayer Bill of Rights. According to the website, buildingabettercolorado.org, the aim of the Gallagher Amendment to the state constitution, which went into effect in 1982, was to stabilize rising personal property taxes. It froze personal property taxes at 45% of total taxes. Before Gallagher went into effect, houses were assessed at 30% of their market value. As property values continued to rise, the assessed value of personal property had to decrease in order to maintain the required 45% of total taxes. At the same time, small businesses and farmers paid four times as much as personal property owners. By the time the Gallagher Amendment was repealed by the voters in 2020, the assessed rate of personal property had decreased 75% to 7.15%The current assessment rate for personal property is 7.15% and will stay that way under current law, with small businesses and farmers still paying four times as much.The website, leg.colorado.gov, states that the Taxpayer Bill of Rights, which went into effect in 1992, limits increases in taxes to the amount of the previous year’s taxes adjusted for population growth and inflation. Any taxes taken in above that amount must be returned to the taxpayers. Under TABOR, if property values continue to increase, the 7.15% assessed value will bring in more taxes and could result in more taxes than allowed by TABOR. This would mean a refund to taxpayers.In Colorado, property is reassessed every two years during odd years. El Paso County Assessor Steve Schleiker said that the COVID 19 pandemic has had no effect on residential property market values for the 2021 reassessment. However, his office is still collecting data on commercial property. Schleiker said the assessed value of some commercial properties such as restaurants, gyms, hotels and office buildings, which either had to close or saw decreased business, could be affected.Between the 2019 reappraisal and the 2021 reappraisal, Schleiker said that property values in the Falcon area went up 20%. He said that houses in the area are currently being sold at a higher rate; and, while there is still much data to collect, it is likely market values and assessed values will continue to increase.For property that is a primary residence, the homeowner can receive a homestead exemption that reduces the appraised value of the property for tax purposes, which results in a lower tax bill.
