Real Estate Math

Mill Rate

A property tax rate expressed as the tax per $1,000 of assessed property value, one mill equals one-tenth of one cent.


Definition

A mill is one-tenth of one cent, or $0.001. A mill rate of 25 mills means the property owner pays $25 for every $1,000 of assessed value. To calculate property tax using mills: Tax = (Assessed Value ÷ 1,000) × Mill Rate. Mill rates are set annually by local taxing authorities (municipalities, school districts, counties) based on their budget needs and the total assessed value of all property in the jurisdiction.

Exam Tip

1 mill = $1 per $1,000 of assessed value = $0.001. Tax = Assessed Value × (Mill Rate ÷ 1,000). Practice these calculations. They appear on every exam.

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