Tax Discussion

[TheAnk]

So I am trying to figure out the new taxes.. They say the assessed value is reduced by 50%, then mult by mil rate (not set yet), divided by 1000.. This makes sense, but if you factor in the homestead exemptions, it would appear effective tax rates have gone way down for in city residents..

hypothetical before and after:

150k assessed value, @ 100% full value, tax rate of $30.23, 50% homestead exemption

= $2267.25

300k assessed value, @ 50% full value, tax rate of $22.61 (proposed tax rate), 50% homestead exeption

= $1695.75

Does this seem right? It does not seem right to me..

[Recchia]

I think the 50% full value thing IS the homestead exemption. So it'd be assessed value/2 X new tax rate. I may be wrong though. Is the new rate really proposed at 22.61?

[foxpointer]

I think the 50% full value thing IS the homestead exemption. So it'd be assessed value/2 X new tax rate. I may be wrong though. Is the new rate really proposed at 22.61?

Recchia, the 50% is the homestead exemption, correct.

Ank, curious as to there you got the $22.61. Nonetheless, in your scenario you double counted because you reduced $300k by half, then you reduced by half again (bringing you to effective value of $75K instead of $150K)

The correct calculation I believe is as follows:

150k assessed value, @ 50% full value. = ($75k * tax rate of $30.23)/1000

= $2267.25

300k assessed value, @ 50% full value. = ($150k * tax rate of $22.61 (proposed tax rate))/1000

= $3391.50

If the $22.61 is actually the new proposed rate, the City is reducing the rate by close to 34%. So, if your valuation went up by less than 34%, you will see a reduction in your taxes. If you went up by more than 34%, you should see an increase. Your scenario meets this test, as you assume the property has gone up in value by 100%.

[c.a.haynes]

As far as I've seen in the Projo, the rate is $22.61, however, there is nothing concrete about the 50% Homestead adjustment.

Recchia, the 50% is the homestead exemption, correct.

Ank, curious as to there you got the $22.61. Nonetheless, in your scenario you double counted because you reduced $300k by half, then you reduced by half again (bringing you to effective value of $75K instead of $150K)

The correct calculation I believe is as follows:

150k assessed value, @ 50% full value. = ($75k * tax rate of $30.23)/1000

= $2267.25

300k assessed value, @ 50% full value. = ($150k * tax rate of $22.61 (proposed tax rate))/1000

= $3391.50

If the $22.61 is actually the new proposed rate, the City is reducing the rate by close to 34%. So, if your valuation went up by less than 34%, you will see a reduction in your taxes. If you went up by more than 34%, you should see an increase. Your scenario meets this test, as you assume the property has gone up in value by 100%.

[foxpointer]

It would stand to reason that the homestead would stay at 50%. If the median value throughout the city went up about 40%, as reported, and the $22.61 represents a 34% rate reduction, overall the City will come out with a net gain in revenue somewhere around the state-mandated cap of 5.5%.

[Recchia]

Yay so I'll have have a bunch of money left over in my escrow account this year!

[TheAnk]

I call Division of Taxation, and the gentleman who asnwered the phone offered up the "propsed rate" at $22.61. I was using the $30.21 rate during my call, and he stated that was last years, and the new proposed rate was $22.61.. It doesn't seem right to me.. This would mean taxes would go down for many people I assume..

[TheAnk]

I didn't know the homestead could change.. Interesting.. As far as I've known it was 50% and 33% non-occ resident.. Dammit, I thought that was a constant..

[foxpointer]

I didn't know the homestead could change.. Interesting.. As far as I've known it was 50% and 33% non-occ resident.. Dammit, I thought that was a constant..

Used to be 33% but in the last major reval, the exemption was raised to 50%.

[Mothra]

Why is there any exemption at all for non owner occupied houses? Is that only for residents of Providence who happen to own other real estate in Providence? Or is that for any old scumbag landlord living the highlife out in East Greenwich?

[Bil]

Or is that for any old scumbag landlord living the highlife out in East Greenwich?

I understand why everyone picks on EG, and it is definitely deserved, but there are some urbanists here! EG has one of the nicer, walkable, (mostly) full service downtowns in the state.

I propose we create a fictional RI town for super-rich-snobby-scumbag-nimby-douchebag-smug-entitled-etc-etc RI'ers that we can all denigrate at our pleasure. Sort of an anti-Quahog, RI. Maybe North-East Greenbarringtownport?

[Recchia]

I understand why everyone picks on EG, and it is definitely deserved, but there are some urbanists here! EG has one of the nicer, walkable, (mostly) full service downtowns in the state.

I propose we create a fictional RI town for super-rich-snobby-scumbag-nimby-douchebag-smug-entitled-etc-etc RI'ers that we can all denigrate at our pleasure. Sort of an anti-Quahog, RI. Maybe North-East Greenbarringtownport?

Downtown EG should secede from the rest of the town. It really is a whole nother (much better) world. I think that people pick on it because it is so wealthy, even in its urban section.

[matt]

North-East Greenbarringtownport?

[TheAnk]

I'm in city resident, and the non-owner occ rate for ppty held for city residents is 33%.. But.. I am moving.. Is this homestead in city only or is it in state?

[foxpointer]

I'm in city resident, and the non-owner occ rate for ppty held for city residents is 33%.. But.. I am moving.. Is this homestead in city only or is it in state?

Homestead is set by the municipality. In Providence, owner-occupied residences get the full 50% homestaed; non-owner ocupied residences can qualify for 33% homestaed.

You can see tax rates and those communities offering homestead exemptions here:

Tax Rates

[Recchia]

You can see tax rates and those communities offering homestead exemptions here:

Tax Rates

Boy am I glad my car is worth under $5,000 so I don't have to pay the Providence car tax!

[Recchia]

Does anybody know:

1)do you have to apply for the homestead exemption? and how? I read somewhere that there's a March 15th deadline but considering I moved in April what do I do?

2)when do the tax bills get mailed out?

[Mothra]

Does anybody know:

1)do you have to apply for the homestead exemption? and how? I read somewhere that there's a March 15th deadline but considering I moved in April what do I do?

2)when do the tax bills get mailed out?

I rec'd the tax bill for my car in yesterday's mail. I would imagine that the tax bills for houses go out around the same time. However, if you escrow your tax payments with your mortgage company it is possible that the city only sends it to them. The city no longer mails out duplicate tax bills.

[matt]

Does anybody know:

1)do you have to apply for the homestead exemption? and how? I read somewhere that there's a March 15th deadline but considering I moved in April what do I do?

2)when do the tax bills get mailed out?

To apply for the homestead exemption you go to city hall assessors office and fill out one form. However, you must be a resident as of 12/31 which means you'll qualify for next years exemption ( i think).

[TheAnk]

I am pretty sure you need to fill out the form or no homestead exemption.. I am positive if you have multiple pptys you need to fill a form out to change the homestead from each ppty.. It makes sense to have you have to fill it out, and to not advertize it anywhere, its a substantial drop in tax..

I thought I still got dupe tax bills but that might have been two years ago..

I find it very convenient that the city values cars at book value plus like 40%.. Ridiculous..

"Homestead is set by the municipality."

Does this mean if I move to Barrington/Warren/Bristol I still get the 33%??

[jencoleslaw]

"Homestead is set by the municipality."

Does this mean if I move to Barrington/Warren/Bristol I still get the 33%??

no, you traitor, it means if you leave the city you're just another scumbag landlord living in the lap of luxury while your properties crumble.

just kidding. But really, you don't get any kind of exemption if you move your primary residence outside city lines. Well, unless of course, you lie about where you really live, but i'm sure no one in providence does THAT.

[TheAnk]

[smcbride11]

Does anybody know:

1)do you have to apply for the homestead exemption? and how? I read somewhere that there's a March 15th deadline but considering I moved in April what do I do?

Yes, you have to file by 3/15(ish - I assume it changes from year to year) of every year... But in all likelihood, the exemption was filed by the previous owner - it's bound to the property, not the person.

2)when do the tax bills get mailed out?

Received mine today... Looks like it's $22.84 per thousand - I assume this is the new mill rate, since they're billing me at the new valuation.

[Recchia]

Coincidentally, I got my tax bill yesterday. This will probably be the only time in my life I was excited to get it, since it was $800 bucks less than I'm paying into my escrow account annually for it. Does the city send the bill to your mortgage company as well or should I?

[matt]

Coincidentally, I got my tax bill yesterday. This will probably be the only time in my life I was excited to get it, since it was $800 bucks less than I'm paying into my escrow account annually for it. Does the city send the bill to your mortgage company as well or should I?

That happened to me the first year I moved into my house. If you have an escrow, you should call you mortgage company to let them know you received the bill, and they'll have you forward it or fax it to them.