Frequently Asked Questions
- How is my property value determined?
- What property exemptions are available?
- How can I appeal my assessment?
- How is the tax rate figured?
Property tax is an ad valorem tax--which means according to value-- based upon a person's wealth. Wealth is determined by the property a person owns. All real property and all personal property are taxable unless the property has been exempted by law. Real property is land and generally anything that is erected, growing or affixed to the land; and personal property is everything that can be owned that is not real estate.
Property taxes are charged against the owner of the property on January 1, and against the property itself if the owner is not known. Property tax returns are to be filed between January 1 and April 1 with the county tax assessor's office.
Fair Market Value
The Assessors are charged with establishing the fair market value of the taxable real and personal properties in Dawson County. Fair market value means "the amount a knowledgeable buyer would pay for the property and a willing seller would accept for the property at an arm's length, bona fide sale."
The Board of Assessors does not create property values. Assessors and appraisers merely interpret what is happening in the market place. The appraised value is simply the estimate of what the property is worth.
The Assessors use standard approaches in setting the value on all real and personal property. There are three approaches to value:
- Cost Approach: The cost approach uses actual replacement cost of the building, less general depreciation, plus the value of the land.
- Market Approach: The market approach involves analyzing sales of similar properties to predict the likely selling price of unsold properties.
- Income Approach: The income approach is used for income-producing properties. It involves capitalizing the net income to arrive at a probable selling price for the property.
Special Assessment Programs
There are special assessment programs available to taxpayers. These special programs include:
Preferential Agricultural Property Bona fide agricultural property can be assessed at 75 percent of the assessment of other property. This means that this type of property is assessed at 30 percent of fair market value rather than 40 percent. Property that qualifies for this special assessment must be maintained in its current use for a period of ten years.
Conservation Use Property
Bona fide agricultural property can be assessed at its current use value rather than the fair market value. Property that qualifies for this special assessment must be maintained in a current use for a period of ten years.
Environmentally Sensitive Property
Property can be assessed at its current use value rather than the fair market value when such property is maintained in its natural condition and meets the requirements set by the Department of Natural Resources. Property that qualifies for this special assessment must be maintained in a current use for a period of ten years.
Residential Transitional Property
Property can be assessed at its current use value, rather than fair market value, when it is used for residential purposes but located in an area that is changing to, or being developed for, a use other than residential.
Standing timber is not taxed until sold or harvested, at which time it is taxed based upon 100 percent of its fair market value. There are three types of sales and harvests that are taxable:
- lump sum sales where the timber is sold at a specific price regardless of volume
- unit price sales where the timber is sold or harvested based on a specific price per volume
- owner harvests where a land owner harvests his own timber and sells it by volume
Equipment, Machinery, and Fixtures
Equipment, machinery, and fixtures are assessed at 40 percent of fair market value. The tax assessor may value the equipment, machinery, and fixtures of a going business to reflect the fair market value of the business as a whole. When no ready market exists for the sale of equipment, machinery, and fixtures, a fair market value may be determined by resorting to any reasonable, relevant, and useful information available. This information may include, but is not limited to, the original cost of the property, depreciation or obsolescence, and any increase in value by reason of inflation. Other determining factors include:
- existing zoning of property
- existing use of property
- existing covenant or restrictions in deed dedicating the property to a particular use
- any other important factors
Tax assessors have access to any public records in order to discover such information.
Homestead, School, Disabled Veterans, and Preferential Agriculture
Property tax is one of the primary sources of revenue for Dawson County. It is used to fund police and fire services, education, roads, bridges, water, parks, and other county services. The basis for property tax is the fair market value of the property, which is established on January 1 of each year. The tax is levied on the assessment value, which by law is established at 40 percent of fair market value. The amount of tax is determined by the millage rate. (One mill of tax is equal to $1 per $1,000 of assessed value.)
We accept applications year round. Applications for the current year must be made prior to April 1 of the year the application is being sought. Once you have applied for an exemption, you do not need to reapply unless you move to another location.
You may be eligible for conservation use or preferential agricultural assessment exemption if you are in good faith agricultural/forest production. This would include; producing plants, trees, fowl or animals, or the production of aquaculture, horticulture, floriculture, forestry, dairy, livestock, poultry and apiarian products.
With both programs, you enter into a 10 year covenant with Dawson County whereby you agree to continue your property in agricultural or forestry production. Agricultural preferential assessment generally provides a 25 percent advantage over fair market value. Conservation use can offer significant savings, in some cases greater than 50 percent of fair market value.
Residential Transitional Exemption
If you live in an area that is in a transition form from residential to commercial use, and it is affecting the value of your property, you may apply for a residential transitional assessment covenant. This is also a 10-year covenant. For all three, apply between January 1 and April 1.
After the assessors establish a new value on a piece of property, the tax payer is sent a assessment notice. The assessment informs you of the new proposed valuation of your property. You have 45 days to appeal the new valuation if you feel its incorrect. The appeal must be filed in writing. Late appeals are invalid.
Basis for appeal
After you have given careful consideration to the value placed on your property and if you feel its incorrect, your appeal should be based on one of the following areas of appeal:
- Taxability: Is the property taxable or does it qualify for exempt status?
- Uniformity: Does the property value compare with the value of similar properties?
- Value: Is the property value too high or too low?
When you file an appeal, the Board of Tax Assessors reviews it and determines whether a change in the valuation is warranted. If no change is made, it will then go to the next level of appeal, the Board of Equalization.
The Board of Equalization is a independent three-person board appointed by the Dawson County Grand Jury. Its specific function is to hear unresolved appeals from taxpayers. After hearing both the assessors and the taxpayer's position, the Board of Equalization renders a decision on the valuation.
If either side disagrees with the decision of the Board of Equalization, the taxpayer or the assessor may proceed to the next level of appeal, Dawson County Superior Court.
The tax rate, or millage, is set annually. A tax rate of one mill represents a tax liability of one dollar per $1,000 of assessed value.
The assessed value--40 percent of the fair market value--of a house that is worth $100,000 is $40,000. In a county where the millage rate is 25 mills the property tax on that house would be $1,000; $25 for every $1,000 of assessed value or $25 multiplied by 40 is $1,000.